“Time is money,” my dad would lecture me, as I whiled away a youthful summertime playing Nintendo games or exploring the beaches of my hometown.
My dad’s workaholic tendencies never seemed to get him what he wanted in life, but those same tendencies ensured I had my first flyer route at age 5, and got my first job before my 15th birthday.
As a youngster, I had to present budgets for how I spent and saved my earnings; my expenses on candy were always subject to scrutiny and disapproval. Money was king, the paternal logic went. Those who had enough of it were happy, fulfilled, held in esteem by their peers. Some of my dad’s deathbed regrets about wishing he could use his money to buy more time hit me hard because they undermined an upbringing that taught me we swapped time for money, and used unpaid overtime and ‘performance review’ results as a means of judging worth.
I’ve come to believe that dad’s old maxim, the old business saying ‘time is money’, has it backwards. It suggests that wasting time is the equivalent to wasting money. Since you spend time to earn money, the logic goes, wasting time must then equate to an actual monetary loss.
In our personal lives, it is the opposite: spending money costs you the most precious resource of all, something you can never get back — your time. You may not be able to stop time or turn back the clock, but with some thoughtful skill acquisition and careful stewarding of your financial resources, using ‘homestead economics’ you can decrease your lifestyle expenses. Do this enough, and you may just find your household budget improves to the point where you can turn down overtime, or work less hours each week, turning you into a ‘time wizard’ — someone who can create time.
When you dedicate yourself to the ‘do it yourself’ principles of homesteading, this free time creates extra hobby time, which, used wisely, you can use to acquire more skills that in turn help to reduce your monthly expenses further. All of which leads to — yup! — more time.
This virtuous cycle can be repeated as often as you like until you achieve the lifestyle balance you are looking for. You might even want to ‘get to zero’—the holy grail of homesteaders—where your basic monthly expenses approach zero. For us, this is still several years away. But with each new skill we acquire it gets a little closer as we change the fuel our lifestyle needs, from money to sweat.
A majority of us have our career expectations laid out for us by our parents, schools, and society at large, while we are still in our formative years. Earn paychecks, buy consumer goods like large televisions or handheld devices to occupy yourself with during your free time, earn raises to afford the ever-increasing cost of living. Rinse, wash, repeat.
Your reward for working harder and putting in more time each year is supposedly offset by the increases in pay that allow for extra toys or vacations during your (ever-shrinking) leisure time.
However, several factors in the modern age—wage stagnation, double-digit food price increases, massive increases in power bills (expected to rise in N.L. 51 percent by 2020, rising insurance & education costs, even the sagging Canadian dollar—all give away the ‘Beaver Cleaver’ lie that you can get ahead simply by working hard enough, and that we all get our white picket fences in the end. Statistics show that many Canadians find their standard of living declining, and Canadian consumers are now at record-high levels of debt.
The party’s over
The Bank of Canada has, once again, kept its benchmark interest rate at an all-time low of 0.5 percent, where it has more or less floated since the financial crisis in 2008.
Interest rates can and do fluctuate, but this artificially-low interest rate has been fixed for many years. The only reason it hasn’t spiked is due to a fear that raising interest rates will lead to a cascade of consumer and business defaults on debt, potentially creating a major financial meltdown. Never mind the 23 percent interest your parents may have been paying on their mortgage in 1983 — ‘stress testing’ done by the big financial institutions has concluded that even a mild raise of 1-2 percent will bankrupt people and shutter businesses to a degree that will disrupt the economy.
When interest rates rise you’re on the hook — right where they want you.
Our banks insist interest rate increases are coming, and they are. Eventually. Right now, many banks are using this period of low interest to tease people into taking on more debt. “Take a summer vacation! Renovate your kitchen!” said a mail-out I received from my bank in August, as they tossed me an additional $5,000 in unsecured debt on my line of credit. Of course, this is a trap. While the banks want you to believe low-interest debt means you can carry more debt under the same conditions, when interest rates rise you’re on the hook — right where they want you.
My wife Lisa and some 70,000 (or 1 in 8) other Newfoundlanders and Labradorians work in the public sector, so it is troubling to see the increases in our cost of living (13-27 percent increase in meat prices over 2013, and a slated 53 percent increase in energy prices, for example) offset by wage increases of, for example, a 5 percent increase over four years. This is well below the ‘consumer index’ rate of inflation, and miles below the rate of inflation for basics such as healthy food, childcare, and energy.
Looking at all of this we get a sense that the game is rigged against us, that debt is built in to the system like invisible shackles that keep us playing a game of Monopoly where the competition cheats. And you can only save a dollar if you manage to earn a dollar more than you need to pay your bills.
Homestead economics, however, offers a cure, by allowing you to start opting out of the money game, bit by bit. You can’t get rid of your bills entirely, but you can get rid of some, lessen others, and give yourself some breathing room to save, if you’re willing to get creative with your downtime.
Depression economics, version 2.0
So what is homestead economics? In a nutshell, it is basically the 2.0 version of the pennywise, shoestring-wisdom your grandmother probably lived by.
“Make it do, or do without,” was a line I heard my grandmother use more than once. A few years ago, while visiting my 91-year-old grandma, I was astonished to see that she had her 1970s washing machine apart in pieces on the floor. “It gave up the ghost, and I’m not buying a new one at my age,” she said, fixing it herself. Eminently sensible, my grandmother believed that if you had things, you also knew how to fix them. This flew in the face of the ‘80s and ‘90s culture I grew up in, where broken things, or even unfashionable things, were thrown away and replaced with relative impunity.
Homestead economics runs the gamut of everything you spend money on in your life. Make a list, a household budget if you will, of all the things you spend money on in a month. Then get rid of as many of them as you can. Don’t be overwhelmed — this list will be enormous and there are probably a hundred or more different little things you can do to eliminate or reduce some of these expenses. You’d be surprised at how many ‘essentials’ you can do without if you’re both creative and willing to make a few sacrifices. Half the fun is finding the ‘leaks’ in your budget, and then fixing them. Find workable solutions that lie within your passions and interests, and it’s like rolling a ball downhill — the momentum builds on its own!
Subscriptions and memberships were the first line item to receive heavy scrutiny when we developed this approach to our budgeting. ‘Box of the month’ clubs, aside from their novelty value (ooh! presents in the mail!), are simply an added expense each month. I thought I ‘needed’ my Netflix subscription until I cancelled it one day a while back; that block of time now gets put to better use, and it’s an extra $8 each month we don’t have to pay for.
I challenged myself to cancel my gym membership and replace my physical activity with costless alternatives. Now ‘gym-time’ is replaced with free, or even productive, activities I enjoy much more, like trail hiking with the goats, harvesting maple syrup, or chopping firewood (which also drives down our energy costs). I find myself in better physical shape in the years since then, as well as saving over $600 a year in gym membership fees.
Growing food, of course, is another activity which not only fills some of the space in your leisure time, but also reduces the amount of money you spend at the grocery store — especially considering the CBC recently reported that fresh vegetable prices rose 11.5 percent across Canada in 2015.
Initially, with our gardening, we grew what we liked, or what we had success with. But not all garden produce contributes equally to your cost reduction. Last year we analyzed the output of our garden boxes, and it turned out our 16 square feet of growing space for kale put out over a 100 pounds of kale over the season, whereas our carrot bed, which is the same size, only gave us 15 pounds of carrots. Root vegetables might be easy to grow, but they are also exceedingly cheap to buy in the stores. With our growing space, it makes more sense to focus on pricier goods. More kale, strawberries, and tomatoes, and less onions, carrots, and potatoes.
Fruit is very expensive, but you can grow your own strawberries with relative ease, or forage for blueberries, blackberries, chuckley-pears, among others. We still buy bananas for our household—because they’re cheap—but have vetoed grapes (surely blueberries are just mini grapes anyway!). We just pick more blueberries now to fill that void.
Learning to cook is probably the single biggest thing we did to cut our grocery bills in half. We both knew how to make a few basic meals, but committing ourselves to learning one new dish a month, and incorporating it into our diet, has enabled us to save money on groceries simply by eliminating packaged and processed food.
One of the most effective ways we slashed our monthly spending was by committing to never buying beverages. We were shocked when, several years ago, we actually made a monthly total of how much money our household spent on beverages. Lattes and coffee a few times a week, an iced cappuccino or fruit smoothie on a hot day, a case of beer or cider for a long weekend, or even a bottled drink to bring along to work or an outing, along with the bottled or concentrated juices and pop we bought to drink at home, cost us thousands of dollars each year, most of it empty calories with little value to our diet.
These days, we make one gallon batches of iced tea a few times a week. Five tea bags, half a cup of lemon juice, and a 3/4 cup of sugar gives us a batch of iced tea (better than Lipton’s) that costs about 20 cents a litre instead of $2.79 a litre. The one-time purchase of a juice press now gives us blueberry juice, raspberry juice, chuckley pear juice, cranberry juice, and apple cider, which we drink all season. We also even concentrate some to freeze for off-season use, made from the fruit we pick during summertime hikes.
We roast coffee and grow tea as a household plant, allowing us the luxury of tea and coffee at a cost that is pennies on the dollar compared to retail product. Some simple brewing skills have eliminated what we spend on alcoholic beverages as well; I prefer my own hard cider or blueberry mead any day. And, besides, when I brew it myself I don’t need to worry about how much arsenic I’m drinking.
Next to food, one of our biggest variable expenses per month was entertainment.
Previously, I was resistant to cutting entertainment costs when looking at ways to reduce the cost of our lifestyle. After all, it stands to reason that cutting your entertainment budget in half, halves your fun. But many of the best things in life are free, and many aspects of homestead economics end up overlapping each other – one hand washing the other, so to speak.
The ducks that provide us with fresh eggs (food savings), and down for pillows, also provide us with hours of entertainment, watching their antics as they splash and play. With ‘Duck TV’ serving up fresh episodes every day during daylight hours, how could I ever miss cable TV or Netflix?
Replace time at the movies with a walk with a friend, replace screen time with face time, and you’ll be surprised how often people welcome it. Ditching handheld devices was done as a way to cut expenses, but the real benefit was how much free time crept in to each day suddenly. Hobby crafts, which are a pleasure to make, go on to serve a functional use that replaces something you would otherwise buy, or can be given as a gift – saving yet another expense.
What started out as a simple exercise in cutting our monthly expenses 10 years ago has since become a way of life, driven by a sense of sustainability instead of dollars on a budget. What I didn’t expect was that life would get simpler, and happier, the more we learned to do on our own, or do without.
As a child, I used to wonder what my grandparents did with all their free time before there was television. I don’t wonder any more! Now, I look back and wonder what I used to do with all of my free time when there was television.