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Personal finance types love to talk about reducing spending (spend less than you earn) and increasing income (earn more than you spend).  Oftentimes this becomes some kind of debate.  As if it was some kind of battle where one wins over the other one.  Or at least where one is somehow superior to the other one.

This is silly.

Reducing spending and increasing income both take effort and produce money in exchange for that effort.  Therefore, the question to ask is “How much effort is it to do X and how much money do I bank because of it?”

Do the mental computations based on your life situations and start knocking out the easiest things with the largest payoffs.  Forget about those things that require lots of effort for little gain.  Here’s some examples:

Options for reducing spending:
- Switching to a generic brand (assuming similar quality) requires next to zero effort and can save you several dollars per shopping trip.  Or lots of money depending on how much you buy.  This sounds like a good deal.
- Saving $50 in cooling costs by turning off your air conditioning and getting a big box fan also sounds like a good deal.
- Saving $2-3 a month by constantly unplugging your “vampire appliances” sounds like a rip off.

Options for increasing income?
- Make $50 by watching a cat for a weekend sounds like a good deal.
- Spending hours writing for Associated Content for ~$3-4 an article sounds like a rip off.
- Spending several months (years?) writing a book that could bring in thousands of dollars?  Possibly a good deal depending on how much you enjoy the the work, how much time it takes and how much you think you’ll make.

What’s your take?  What are some of the easiest or hardest ways you know about to reduce spending or increase income?

Frugality is one of those words that seems to have different meanings depending on how well the economy is doing.  Consider for a moment economic good times where everyone is spending, the stock market is rising and things overall are looking to be on the up and up.  In times like these frugality conjures up images of the penny pinching miser who never has any fun or treats himself or herself to anything nice.  Now consider a recession like our current one.  All of a sudden frugal people are paragons of wise spending who will be able to easily coast through economic hardship and emerge unscathed on the other end.  Frugal activities like coupon cutting are all of a sudden in vogue in a recession.

But once the recession comes to an end frugal people and activities will go back to being considered something to look down upon.

To be honest, I don’t really like being called frugal.  I don’t like being looked down upon because I occasionally figure out some way to save a buck.  I don’t like people associating coupon clipping or any other cost saving activity with never having fun in life.  So I thought it would be wise to take this opportunity to educate people as to what being frugal is really about.

First of all, frugality is not about never having fun in life, nor is it about obsessively saving for retirement.

People who are obsessed with saving money by any and every means possible are cheap.  Cheap is often confused with frugality because cheap people and frugal people use similar tactics to save money.  But cheap people take it to the extreme.  They are obsessed about it.  So obsessed that they often miss out on a lot of what life has to offer them.  Cheap people are the ones who never buy something nice or go out to a fancy restaurant.  They don’t do these things because they can’t afford them, they do these things because spending money is anathema to them.  Cheap people feel bad when they spend money.

On the other end of the spectrum we have people who are obsessed with buying things, often to the point that they neglect long-term financial goals such as retirement savings and even run up considerable debt.  These people are spendthrift.  You might think that there is no similarity between frugal and spendthrift, but you would be wrong.  Spendthrift individuals buy lots of nice things.  They also buy lots of things on a whim and then forget about them.  Spendthrift people essentially validate themselves by way of their possessions; the more they have the better a person they are.

Frugality is the happy median between cheap and spendthrift.  Frugality is all about leveraging every dollar to its fullest in order to get the most out of life while saving for the future.  Frugal people borrow from both ends of the spectrum to produce something greater.  Like the cheap people, frugal individuals are always on the lookout for ways to save money.  But they aren’t going to have a conniption if they waste a little here and there.  That’s part of life.  Like the spendthrifts, frugal people are willing to (and actually want to) buy nice things, but only if they can afford them.  Unlike the spendthrift people, frugal individuals skip buying all those things that they are probably never going to use and that just wind up in a closet somewhere.  Frugal people have both long-term savings goals and short term spending goals.  They strive to make every dollar they bring in work towards those goals.  And frugal people are willing and able make compromises between those saving and spending goals, so that they can get the most value for their money.

Any cook would consider a well stocked pantry to be a culinary arsenal.  A frugal cook would recognize that having a well stocked pantry opens up a variety of methods to save money while not sacrificing access to good food.

How to build a well stocked pantry
The first step to stocking your pantry is NOT to rush out and buy a ton of food.  You aren’t trying to stock a home made bomb shelter out of fear for the upcoming Apocalypse.

Begin by taking an inventory of what kinds of ingredients you use most often.  I’m not talking about an exhaustive itemized inventory of your entire kitchen.  The key words are “most often” which means that you can probably write all of them down on yellow post-it note using very large letters.  When making this list focus only on things that can be easily stored for long periods of time without refrigeration.  Depending on your available freezer space you may wish to make a separate list for freezer or refrigerator items such as meats and cheeses.

Now that you have your list, it’s time to assess your available cabinet space.  While it probably looks cluttered I guarantee that you’ll find lots of space with just a little effort.  Rummage through your old food and remove anything that’s expired.  While you’re at it consider reducing the number of dishes, glasses and other kitchen items you have around.  Do you need dinnerware for 12 people when there’s only 1 or 2 of you living in a small apartment?

Be prepared to think outside the cabinets.  Do you have room above your cabinets?  In drawers?  In a closet?  Any of those could be easily converted into extra pantry space.

Saving money by buying more
The whole save by buying more thing may sound like an oxymoron, but when it comes to pantries it’s true.

Now that you have space and a list it’s time to begin stocking up in a frugal fashion.  Again, don’t rush out and buy everything all at once.  Take your list with you to the grocery store and check the prices of each item on it.  Do this for a few weeks and you may notice a sale.  When the item goes on sale, stock up.  Buy enough to last at least 6 weeks.  The idea is to buy as many as you’ll need to last at least until the next sale.  Each time you go grocery shopping check on the prices of the items that you stocked up on, when they go back on sale buy a few to refill your pantry.

And always rotate your stock, making sure to put the newest items at the back.  This helps to ensure that everything stays fresh and doesn’t expire by the time you get around to using it.

If this sounds a bit like keeping a grocery price book, that’s because it is.  The only difference is that I’m focusing only on the most frequently used items.  And no, you don’t need to run around to 12 different stores to make this system work.  Every store has its own cycle of sales so your patience will be rewarded even if you are only a one store shopper.

Use common sense when bulk buying.  If you only use 8 oz of tomato sauce at a time, it doesn’t make sense to buy a 128 oz can.  It’s better to buy 16 smaller 8 oz cans.  If you are trying to squeeze every penny until it screams you could buy a 128 oz can and then open it up and partition it out into 8 oz servings which you would then store in your freezer.  In my opinion, this takes too much effort and consumes too much freezer space to be practical for most people.  Freezer space is precious and should be saved for more expensive items, like meat.

For other ingredients such as flour, sugar, pasta and rice bulk buying may be a great option.  However, I would recommend storing them in air tight containers in order to preserve freshness.

Now that you’ve got your most commonly used ingredients taken care of, consider those that are less commonly used.  Again, the idea is to always have some on hand, but since these items aren’t used very often you may only need one or two around.  You could use the price book approach and wait for sales or you could just buy them as you need them.

Eating better
A well stocked pantry combined with it’s culinary cousin, a well stocked spice rack, helps you eat better by allowing you on the fly flexibility when it comes to meals.

Did you have a long day at work and don’t feel like making a three course dinner?  No problem, scale it down.  Are you in the mood for three course dinner but were only planning a simple meal?  No problem, you’ve probably got enough food stored to easily scale it up.

Did you find a new recipe that you want to try out?  Chances are that your pantry will have all (or most) of the necessary ingredients.  Just discover that you have to bake a cake or cookies by 7am tomorrow morning?  No problem, because you’ve got all the necessary ingredients right there at home already.

Whether so bad that you don’t want to go shopping this weekend?  Again, just raid the pantry.

Discovered that you don’t have much money for groceries this month?  Chances are that by using the food you’ve already got stored up you can reduce this month’s grocery bill.

Before you move a single cent into an investment vehicle you need to sit down and think long and hard about what you are doing and ask yourself several questions.  You probably think these questions are something like “What mutual fund is the best,” but in reality the questions that you should be starting with are far more basic.

When do you need the money?
Before you stick money into certificate of deposits (CDs), stocks, bonds or under your mattress you should consider the time frame in which you plan to use the money.  Are you panning to use it in 6 months?  In a year?  In 3 years?  In 10?  Sometime when you retire?  Consider these as rough guidelines to determining your investment time frame.

Short term - less than 3 years
intermediate - 3 to 10 years
long term - greater than 10 years

Whatever time frame you pick will affect your choice of investment vehicle.  Some investment types such as CDs make your money inaccessible for the duration of the CD.  For example, if you invest in a 1-year CD, then you can not touch that money for 1 year or you will pay a significant penalty on the interest.  Other types of investments such as stocks experience regular fluctuations in their price, which means that in the short term it is possible that the money you investmented will actually decrease.  However, over the long term the stock market almost always increases in value.

Keeping in mind this idea that investments do not automatically garuntee returns brings us to the second question that you must consider.

How much risk are you willing to accept?
All investment options carry risk.  Generally speaking the more risk that a given investment carries, the higher the potential return.  The lower the risk the lower the potential return.  The higher return rate is your reward for absorbing the risk that the investment will fail.

If you don’t want to lose your money, select lower risk investments such as savings accounts or CDs.  If short term risk is acceptable to you in exchange for long term growth potential than the stock market is a good option.

Stocks are a favorite investment choice for many people and historically yield good returns. However don’t assume that if you just pick a stock and throw money at it that you will be living the high life in retirement.  Consider carefully the third question.

How much effort are you willing to put in?
I’m not going to kid you, proper investing takes effort.  It takes effort to select an investment vehicle and it takes effort to manage it.  Safer investment options such as savings accounts and CDs require much less effort to research and manage than stocks.  Also the more buying and selling you plan on doing the more effort you are going to have to expend.  In other words, please don’t take up day trading unless you are willing to expend the effort to understand exactly what you are buying and why you are buying it.  If you don’t understand what you are doing then you aren’t investing you are speculating.

Now, if you are rather lazy like me there is another option for you.  Index funds.  These are mutual funds that basically track the stock market as a whole.  This means that are you are absolutely not going to be able to beat the market with an index fund.  On the other hand it does mean that you will do just as well as the market.  Yes, you will have good years and you will have bad years.  But in the end, if you are investing for the long run, you’ll wind up doing pretty well for yourself.

If you work for a big company or go to a university there are probably tons of student and employee discounts that you don’t even know of.  Some common discounted items sponsored by places that I’ve passed through have included movie tickets, museum passes, sporting event tickets, concert tickets, gym memberships, cell phone plans, AAA membership and cruises.

You’ll have to do a little poking around but you’ll be able to find out about them in no time with these easy hints.  First, look through all those employer or university flyers you get in the mail.  They may include actual clipable coupons, special offer codes or the physical address of where to go and purchase discount tickets.  The next thing you want to do is check out the employee or student services office.  Just go in and politely ask if this is the office responsible for helping with special offers or discounts.

Some of these discount deals will have annoying strings attached.  Such as you must buy your tickets from the student services office, they only take cash and are only open during a four hour window.  But rest assured that while these can be irritating, they are almost always harmless.

MSNBC has an interesting article about older workers changing jobs to something with less stress.

Overall the article reports that job changers are happier, have more flexible work hours and less stress in their lives.

Of course, to accomplish this this they had to give up higher pay, status, pensions and  even health insurance.

So would I change jobs?  Right now, yes.  But that’s because my job is pretty much the bottom of the barrel for my field.  But how about when I get older and more established?

I don’t really know, but to be honest changing to a totally different field is something that I would really like to do.  Not because of the stress, but rather because I’m bored out of my mind.

I love food.  I love eating it.  I love cooking it.

I can’t stand it when someone tells me to save money by buying crap food.  No McDonald’s artery clogging meat imitation substitute byproduct pseduo-burgers for me.  No, I don’t care how cheap it is on the dollar menu.  I’m not eating it.  And I don’t like it when people tell me save a buck by making crap food.  So no instant ramen, no flavorless bean dish and no meatless Monday either.

But of course loving food has it’s drawbacks.  Groceries are my second largest expense behind rent.  Part of this is due to the fact that I eat a lot.  Part is due to the amount of meat that I buy (a lot, as I am a true carnivore).  And part has to do with the fact that I will buy whatever ingredients are necessary, no matter how exotic, to make a dish.  Yes I live to eat and consider cooking and eating a hobby as well as a necessity.

But on the upside, the more that I cook the less money that I spend eating out.  Eating out regularly just isn’t worth it anymore.

So I present to you Frugal Foodie Fridays.  Every Friday I will be writing something about food with an eye to saving money but not sacrificing quality.  Recipes, stories, anecdotes, tips, ingredients, shopping advice or whatever whatever I feel like talking about at the time.

This series has no definitive end point and will last until either I get bored with it, become distracted by something else, run out of ideas or am hit by a bus….  Whichever comes first.

Reader contributions and guest posts are highly encouraged.  But you must stick to the only rule of FFF  - save money without sacrificing quality.

The fun begins next Friday!

Drudgery of the 9-5 got you down?  Is it sapping all your energy? Do you feel kind of lethargic by the end of the day?  Here’s a few tips to help you feeling your best all day long so that you have energy left to enjoy the rest of your day once work is over with.

1. Don’t skip meals
Make sure that you eat at least 3 meals a day.  They don’t have to be big meals, they just have to be there.  Skipping meals can make you tired and/or irritable.  And skipping meals can be bad for your waistline for two reasons.  When your body is used to infrequent nutrition it slows down its metabolism and stores as much energy as possible as fat.  And second if you skip meals you’re more likely to get hungry, thus being unable to resist whatever goodies are laying around the office.

2. Stay hydrated
Your body needs water.  If you’re dehydrated you could start feeling tired and listless.  And don’t think that dehydration is reserved for people running marathons.  If you work in a dry climate dehydration could be setting in and you won’t even notice it.  Just because the outside is humid, doesn’t mean that your cubicle is.

3. Consider snacks
Sometimes a little burst of energy helps you make it through the day.  Keep your snacks light and healthy.  I recommend tangerines for this.  Small, sweet, tasty, high fiber.  Can’t really go wrong.

4. Get enough sleep
Most people just don’t sleep enough.  Try for at least 7 hours of sleep a night.  Since waking up later isn’t really  an option for many people consider going to bed earlier.  Also try to make sure that your sleep environment is serene.  Turn off the TV, the computer and the Blackberry.  Your objective is to sleep, not to wake up every two hours to check email.  Don’t drink too much before going to bed lest you wake up in the middle of the night needing to run to the bathroom.

5. Exercise regularly
Incorporating regular exercise into your schedule will help keep your energy up all day long.  It doesn’t have to be much, just 30 minutes or so at least 3 times per week is a good start.

6. Stretch
Spending just a few minutes a day stretching to help limber up those tight muscles and tendons will help keep back and neck aches at bay.  Stretching isn’t the most exciting thing in the world, but it will help you feel less stiff and achy.

7. Get moving
Man (and woman) is not meant to sit in a cubicle all day working at a computer.  Make sure that you get up out of your chair every 45-60 minutes and walk around a little bit.  Do a lap or two around the office.  If you have to, grab some folders so that people think you’re working.

Debt comes in many forms ranging from credit cards to student loans to car loans.  Almost all debt arises for one simple reason - that you spent more than you earned.  Even worse debt rarely ever stops with one purchase.  Not only does the interest compound over time, but the principle can compound as well as you buy more and more that you can not actually afford.  Regardless of how you got into debt it is likely that this debt is proving to be a significant financial and personal burden.

Before you can even begin the process of becoming debt free you must first rise to challenge of meeting each of the three steps outlined below.

1. Admit you have debt.
First and foremost you must admit to yourself that you have debt and that this debt is a burden to you.  This admission is critical because it means that you are finally aware that you have a problem and that you are aware that that problem needs to be solved.  Don’t just admit it to yourself, be sure that you step up and admit it to your family and friends as well.  Your family and friends can act as a valuable social support group as you try to shake off your debt.

2. Resolve to get over your debt.
After you have admitted that debt is a problem in your life you must resolve to get past it.  I don’t mean some kind of fake New Year’s resolution that you will abandon within a month.  Your resolution to break the cycle of debt doesn’t need to be connected with New Year’s Day, Christmas, your birthday, arbor day or any other holiday for that matter.  Your resolution needs only to be true and firm.

3. Being willing and able to make the needed sacrifices.
The truth be told, admissions and resolutions are the easy part of getting out of debt.  Doing the actual work to break free from the shackles of debt is the hard part.  If you are serious about becoming debt free you must be willing and able to make the necessary sacrifices to fulfill your goal.  Yes I wrote sacrifices.  You are going to have to tough things like cutting back on spending.  You will probably have to give up or at least severely curtail costly activities.  You should also focus on finding ways to increase your income, perhaps taking on a part-time job.  Or better yet - do both, reduce your expenses and increase your income.  If you can do these things on a consistent basis you will be able to become debt free.

MSNBC has a great article about how to handle the part of the job interview where you get to ask the questions.  How many of us have gotten to this part of the interview and either stood there like a deer in the headlights or asked something really stupid?  Well no more!

The article begins by telling interviewees to research the job and not to ask about salary and benefits.  The best part of the article is an actual list of questions that you could ask:

• How long have you been trying to fill this position?
• What does daily life in this job entail?
• How do you evaluate success?
• What are you expecting from me in the first 60 days I’m working here?
• What kind of orientation program do you have for new employees?
• What have others who’ve worked with you said about your leadership?
• How much confidence do you have in your team right now?
• What’s more important to you, productivity or creativity?

I think it’s a great list of questions.  Pick three and use them the next time that you are in an interview.  If you are a bit smoother you could try constructing questions that showcase your strengths and talents.

And of course try to avoid asking anything that would make you come off as desperate.