How a family of seven is able to live on $35,000 a year after taxes.
I’ve read about America’s Cheapest Family in various articles and posts but haven’t really seen them in action till I caught a repackaged episode of 20/20 where they were once more featured. I cannot believe how a family of seven with children ages 10 through 21 are able to pull off living on an annual budget of $35,000. They are the aptly named Economides family from Arizona, and they are super-savers.
After watching their segment my main impression was that living that frugally indeed takes a lot of work, organization and effort, which would appear especially more challenging to the uninitiated. Some impressive facts:
- The family paid off their house in 9 years even as their income averaged $33,000 a year. Of course, the ease of pulling this off would depend on the original cost of their home.
- Steve Economides refers to himself as his family’s CEO or “Cheap Economizing Officer” and is a freelance graphic artist. Both he and his wife Annette operate the family business called “HomeEconomiser” which offers a Web site and newsletter for frugal living.
- They spend $350 per month for food and disposable items covering paper goods, cleaning supplies and personal care items.
- A freezer is a necessity to them. They devote a few days a month to cooking all their family meals then store 13 to 17 meals in the freezer each time.
From their experiences, I picked up these lessons based just on what they’ve shared in their interviews and stories. To be able to stretch those dollars hard, here’s what they did:
What America’s Cheapest Family Has Taught Me
#1 Plan. Saving a lot of money begins with serious and meticulous planning.
To save some serious money, you’ll have to start with a plan and a system that will involve developing a budget, applying a lot of resourcefulness, collecting coupons, creating a grocery list, checking and re-checking the list before going out to buy anything. You will also need to plan your menus in advance, take careful inventory of what you have in your home, and do some product and pricing research to see which items are priced best.
The Economides say that “it takes a little bit of time to sit down and plan a menu. But you eat better, you save more money, and it creates less stress in your life.”
The Economides family promotes once a month cooking; here’s a description of how it is done.
#2 Organize. Good organizational habits help you achieve successful money management.
By being more organized, you’re bound to save good money. While the cheapest family has gone on to work things out like clockwork, I’ve unfortunately lost money to being disorganized. Disorganization can cause you to end up with late payments, lost coupons, late fees, forgotten checks, and so forth. Here are some tips for becoming more organized: here’s how to organize your coupons, and your finances.
#3 Shop wisely. A super-saver is an intelligent and determined shopper.
Committed savers are those not afraid to go for the best deal. How seriously do you take your shopping? Well, getting the best prices can be a real sport. For instance, waiting for sales, negotiating for a better price, hunting for the best bargains and asking questions in pursuit of the best prices can take a level of commitment and assertiveness. Do we have it in us to save those bucks? In the midst of such a sport, I’ve seen even some tough customers fold. Yes, including myself.
#4 Communicate effectively. It’s a family project.
I was impressed at how well the Economides communicate as a couple. It is evident how both Steve and Annette complement each other well as partners in their goal to live frugally. Their ability to communicate well goes beyond the use of walkie-talkies while shopping to find the best deals in a store.
#6 Embrace teamwork. Two frugalists are better than one.
When both committed partners support each other towards a common goal, it is more likely for that goal to be achieved and success to be reached.
#5 Make sacrifices. The fruits of sacrifice do add up.
Though I’ve advocated focusing primarily on saving on the big things where the impact is greatest, the examples given by the Economides family demonstrate that small savings do add up. The actual habit of saving on smaller items became instrumental in providing the basis for their lifelong strong frugal habits. The more they saved on everything, particularly the small things, the more disciplined they became, causing a snowball effect.
Some of the tips they’ve employed: “We shopped for clothes at thrift stores and consignment shops instead of ‘the mall,’ bought used furniture, used coupons for groceries, did our own haircuts (except for Annette’s hair) and borrowed free movies from the local library.”
#7 Prioritize frugality. Simplicity and frugality are lifestyle choices.
Mastering frugality in the way the cheapest family has done so, looks like it will take time and dedication to develop. Since time is also money, and planning and being proactive about living thriftily may take some amount of time, it is up to each individual to determine how much saving money is a priority for them. How much time are you willing to spend to work on living frugally?
#8 Stay determined. Saving money takes commitment, discipline and dedication.
The cheapest family swore to never accrue any debt. They’ve decided that even the convenience of using credit cards isn’t worth it to them. They simply don’t use credit cards. Temptations abound everywhere and even as they witnessed their neighbors bring in new furniture, they didn’t give in to “keeping up with the Joneses” by going out and buying something similar:
“Choosing to avoid credit had repercussions. For instance, in the early days of our marriage, we felt discouraged when the Danish furniture truck pulled up to our apartment complex, and our next-door neighbors had beautiful new furniture delivered. Annette just sat on our $25-orange-and-brown-plaid-missionary-purchased couches and cried. Or, after six years, when we were cramped in our smaller-almost-paid-off house, while many of our friends were buying their second or third much larger houses, we sat and wondered if there was something wrong with our plan. In both situations, after a time of soul-searching, we found solace and motivation in our decision to live within our means without the use of credit.”
They are a true inspiration to all of us who want to live within or below our means. To read more about them, you can fetch their book: America’s Cheapest Family.