The money, money, money
REALITY CHECK:With next week's Budget looming, Pricewatch editor CONOR POPEhas a few words of advice on positive frugality
Money-saving tips are now ten penny and thousands of books and websites have been written by self-styled financial gurus promising to help us to keep our heads above choppy financial waters. But as the recession deepens and corners get repeatedly cut, the ways to save get harder and “experts” veer into territory that is quite ridiculous.
One book that has crossed the Pricewatch desk suggests people have their teeth fixed on the cheap by trainee dentists or sign up for medical trials to get free – albeit potentially useless – drugs. Another advises us to become pally with pilots for low-cost jaunts abroad (try this with Ryanair crews and see how far you get) or wear flip-flops year-round to save money on socks.
That’s not even the most outlandish notion. A third book recommends people hang a dead bird from a tree in their garden to scare living birds away from the fruit and vegetables that will – obviously – be growing there because the reader is so serious about this moneysaving, um, lark. Other penny-pinching gems would see seasoned scrimpers refrigerating tights to stop them laddering, using egg white as a glue replacement and beeswax as cheap chewing-gum.
These ideas might work but they will definitely make life miserable. But spending less doesn’t have to mean misery. Most of us have no choice but to explore frugality and find ways to do things on the cheap. Or not do them at all.
But are there ways to cut costs that you’ve not already thought of? A couple of weeks ago we took to Twitter and asked users for their favourite money-saving ideas. Within an hour we had more than 100 top tips but the silver bullet needed to kill the debt monster was missing. Yes, you can mix water and bleach in a spray dispenser for a low-cost kitchen cleaner, bring sandwiches to work, give up takeaway coffee, freeze your credit card but such measures will not do much to clear a mountain of debt.
The reality is that most Irish people have already twigged what needs to be done and are doing it. This is evident in our supermarkets where the switch to own-brand products has been profound. Sales of what used to be called yellow pack goods are up by nearly 400 per cent in five years and it’s easy to see why. Two litres of own-brand milk costs €1.49 while branded equivalents costs 50 cent more. If a family uses just two litres of milk daily they save €182.50 every year by making that one switch.
It is not just in the grocery sector where habits have changed. The second-hand clothes market is booming. Shops that rent high-end frocks for bargain basement prices are popular, and rail sales, which allow fashionistas sell clothes at pop-up flea markets, are taking off, as are consignment stores and swap shops.
The online space, meanwhile, is making saving money easier than ever. There are price comparison websites to find cheaper holidays and insurance, apps for better budgeting and websites showing the cash-strapped how to eat for peanuts. If you type “how to save money” into Google you get 137 million matches.
But one of the peculiar things about the times we live in has been the lack of public anger at the shambles the political and banking classes have made of our economy. In Greece, Spain and Portugal there have been major demonstrations but here people have shrugged as if to say “Ah well, we are where we are”. Today, the narrative may change as what has been billed as a major anti-austerity march is planned for Dublin city centre at lunchtime.
The protest comes on the eve of the sixth austerity budget in five years. But what do all the austerity budgets mean? Someone earning just €35,000 is worse off by more than €1,500 a year.
And people do need help. A recent survey found that one in 10 Irish people lives in food poverty and nearly two million of us have less than €25 a week to spend once essential bills are paid. Health insurance is up over 50 per cent in just two years – and will climb again in January – petrol price hikes have added more than €1,000 to the average driver’s annual spend and food prices are climbing.
Then we have the Michael Noonan Horror Show to look forward to. It is too early to say what impact next week’s Budget will have but we’re all likely to be worse off as more indirect taxes, new and higher charges and fewer reliefs are rolled out.
As Pricewatch editor of this newspaper I’ve had a ringside seat for the boom and bust. The column started nearly 10 years ago and the Celtic Tiger was roaring. What preoccupied readers then was very different to what ticks them off now. People moaned about grumpy taxi drivers and costly chocolate fountains for weddings. Today a depressing number of mails come from people afraid of losing their homes or struggling to feed their children.
But it is not all doom and gloom. As the recession took hold, I presented a television programme on RTÉ called Living Lightly. It was simple: we took families living beyond their means and showed them how to get by on less.
We didn’t impose savage cuts on budgets – we were not the Troika or the Government or even Eddie Hobbs – and we wanted to ensure the cuts were sustainable. We helped them cut their grocery, entertainment and maintenance bills and had them raising chickens, growing potatoes, making beer and puppet theatres. There was composting and recycling and more community engagement. It was great fun and it worked. The families saw their spending fall and their quality of life rise. The show was scrapped, ironically, because the national broadcaster was not living lightly and had run out of cash.
It was a pity. Its message of positive frugality is needed more now than ever. If nothing else it showed that an absence of money sometimes gives people a chance to restore balance to lives once dominated by rampant spending.
The Living Lightly families thought the accumulation of things made them happy but found out the opposite was true. Maybe we can all learn that lesson and maybe when the economic storm clouds lifts, we will all be in a better place.