I used to be terrible with money. I struggled with the credit card debt I began accruing in college, wading through minimal payments on my own. Since money has always been tight, I have always loved to shop at thrift and second-hand stores. As educators, we know there are some interesting things you can find in a second-hand store (as you’ll see in this post!). Thrifting is truly a great way to furnish an educator’s classroom.
Occasionally, I used to browse thrifting websites and take pictures of some interesting items folks were selling. So, as you read on, you’ll discover unlinked images I’ve taken from local (St. Paul, MN) online thrifting sites to help me illustrate my tips. Money is tight and thrifting might be costing you too much “extra” money. There’s never been a better time to build some beneficial habits around money, so every dollar serves a purpose. I've learned a few things as I grew older and wiser that will be helpful.
1. How Do You Use Money?
Above, I made reference to using money as freedom, rather than as security. In my 20’s extra money coming in was spent immediately for dinner, coffee, or a splurge at the thrift store without consequence. I had it, so I spent it. That was freedom. On the flip side, I’ve found myself in many a position where I should have had at least a bit of savings - this means cash in the bank, not a credit card - to help me with car repair bills, or God forbid, a medical emergency. It can take a bit, but squirreling away even $5/per paycheck made me feel much more secure in case a car breaks down, a medical issue happened, or some other unfortunate event occurred. Saving has taught me that I enjoy my freedom more, just by making sure the mask was on myself before doing anything else with my cash.
2. Two Bank Accounts
For most of my life, I’ve used a bank account with a teachers credit union. Every bill and purchase came from that account. Eventually, I learned what the swimmers to the right are trying to tell us. Your money should go in two directions- for consistent bills (nothing else!) and inconsistent purchases. About 20 years ago, I opened a second account with a larger bank and split my spending. Although it takes a bit of planning and rearranging, I’ve never missed a bill since. Here’s how:
- I wrote down all payments that were “static,” meaning those unchanging recurring payments: rent, car, student loans, etc.
- Then I wrote down payment dates over an entire month. This helped me to calculate which bill should be paid when, and to whom.
- This next part requires some legwork. If you need to, contact vendors to ask about shifting. Sometimes there’s a bit of leniency within the window of time payments may be received.
You can do it too!
- Set up auto-pay or direct payment from the “static” account for each of the payments.
- Use Direct Deposit to divide your paycheck into each of your two accounts:
- the static one should have enough money monthly to cover the bills without missing a payment
- the other account should be the rest of the monthly items that are variable: inconsistent payments like groceries or ordering pizza.
Now your “security” and “freedom” money are playing well together without dropping the ball.
3. Thrifting Mindfully
If you get going in the dark of night, you can justify the purchase of almost anything. For instance, last night, this is what I found on Facebook Marketplace.
Now, I love me some Dr. Fauci- he’s adorable. I recognize a temptation and I need to check myself.
- How badly do I need them if I just learned of them last night?
- What else could that money go towards? $20 could be a week of the coffee treat I allow myself each weekday. I could buy gas, pay for someone else’s meal or birthday gift.
- Yes, I KNOW he’s adorable. What’s your attention span for someone who could disappear after he does his work? Will you remain true to him?
- What will you do with it? Where will you put it? Will you wear it or display it for more than a year?
Sometimes asking questions and forcing mindful consideration buys (ha!) all the time you need to make a rational spending decision. This includes the plethora of shelves and BINS (don’t you love the BINS??) you think you need for your classroom. Buy what you need through thrifting and others can do their own bin buying. There’s such a thing as too many bins (really!).
4 more quick tips:
- Avoid scrolling through the thrifting sites randomly, but if you do, limit your scrolling to finding the specific thing you’re after.
- Or, be extra brave and take the thrifting apps off your phone. If you are anything like me, when I am mindlessly looking through the feed, I always find something. Take the guesswork out- not seeing it means you likely won’t buy it. See? You saved yourself some future money!
- Cost/benefit: Do you want to drive 30 minutes to get a $7 make-up holder? How important is it?
- Negotiate. Politely asking, “Would you consider taking ___?” is kinda part of the thrifting game, and the worst they can say is “no.” Make sure your counteroffer is reasonable (not $10 for an item asking $150) and respectful.
4. Where Does Found Money Go?
Once I was aware of my spending habits, I began stashing away any “found money.” This included leftover change from a purchase, "extra money" remaining from a planned purchase, or money I made selling my own stuff! This went into a Culligan water jug with a small opening (a hen cookie jar makes it too easy to take money out). I put it in there and forget about it. My husband and I once had $500 extra for a family vacation just from saving the nickels, quarters, and the occasional paper money.
5. The Ever-Popular and Useful Debt Snowball
Dave Ramsay introduced me to the Debt Snowball through his Financial Peace University course.* The Debt Snowball requires you to continue making the minimum payments, and to focus on the smallest debt first by paying that bill’s minimum payment each month plus any extra money you can throw at it. Making minimum payments enables the debtor to make more money, each time you pay. That, my friends, is a shame.
This method is counter to theories involving interest levels, but many Dave Ramsay followers have found The Debt Snowball to be very effective in getting out of debt.
Here’s how it goes.
- You have listed out all your debts, smallest to largest. For example, your smallest debit is $4000 on your Hot Topix card with a $20 minimum payment.
- Increase your minimum payments to as much as you can afford- even if it’s a dollar here or there. Do this until you’ve completed paying off the Hot Topix bill. You no longer have that $4k hanging over your head!
- Now, roll that minimum payment towards the next smallest bill. While you were paying just the minimum payment, you can now add the $20 you used to pay Hot Topix to make a larger payment, making a $75 payment a nearly $100 payment. Keep hammering on that debt, until it’s paid off, then repeat for every debt, moving smallest to largest.
Click this link to explore a visual of how this works, courtesy of Dave Ramsay.
You’ll notice your debts going down faster with increasingly more money going toward the biggest bills. And you’re working to the reality of becoming “debt-free,” yet another form of financial freedom.
Let’s be mindful of those spending habits into ways you can achieve both security AND freedom with your money. Sometimes, all it takes is an honest look at your money is going, and making a commitment to takes is a bit of hard work. Look at you, being all responsible!
*I highly recommend Dave Ramsay’s Financial Peace University!(not a paid endorsement). This program is 100% legit, and has allowed me and my family to evolve and be productive towards our financial goals (which, I might add, I did not have until we joined Dave Ramsay). It does have a religious element to the presentations, but if that’s not your thing, the learning stands out as practical and achievable.
This blog was originally published on The Chalk Blog on April 6th, 2021. It has been republished here with permission.