Recently, I overheard a heated debate. Quite frankly, I was horrified by some of the far-fetched misconceptions people have about anyone attempting self sufficiency or anything associated with being frugal. For confidentiality reasons, I won't disclose the identites of those involved but, suffice to say, I think you're all a bunch of wallies for being so small-minded. Frugal living is NOT about a bunch of drop-outs avoiding work and not paying taxes, nor is it about staying home and depending on State Benefits.
Working from home means exactly that - you work from your home. Yes, you can work whatever hours suit you and take as much time off as you want but when you're not working, you're not earning. There are no state benefits or statutory sick pay if you're ill, there's no holiday pay and there's no unemployment benefit or income support of any description when work is in short supply. There's no final salary and no company pension, we still need to do annual accounts, pay income tax when due and pay National Insurance contributions. That's the price you pay for being self-employed, debt free and having savings in the bank. It's also a great position to be in when that great opportunity presents itself.
If anyone says to me that they hate going out to work, hate sharing the responsibility of being a parent with some stranger, hate spending hours commuting or hate never having any time to do things for themselves or to spend with their families then my answer to that is, work out how to afford to QUIT! Set your sites on the lifestyle that you want and aim beyond working to pay off debts - aim to live life. The majority of people will reply along the lines of, "I can't afford to give up work," then blame it on a host of other reasons - need the money, too many bills, too many debts... you get the picture. What they really mean is that they aren't prepared to make the necessary changes. The other thing about this scenario is the fact that many people just don't know how much they are actually earning and, worse still, how much their jobs are COSTING THEM!
Let's start off with the very basics - I'm talking about those who pay basic rate income tax or the minimum earners in our society. The simple reason for this is that I haven't actually witnessed any debate with anyone earning a top salary: they all seem to love their jobs and have stay-at-home partners representing them in the parenthood/child-rearing stakes. These are the lucky ones, but they studied for it and they've worked for it, so leave them alone. These are the very people who make it possible for other people to work and earn over £100 per week in the UK without paying any taxes!
So let's look at all the career options that are rolled into just being a frugal living, self-sufficientish homeworker. I have used the Prospects and Wikipedia websites for the basis of my speedy research.
Entrepreneur - a person who is willing to launch a new venture, project or enterprise and accept full responsibility for the outcome.
- Frugaleur - a person who is willing to launch a new frugal venture, project or enterprise and accept full responsibility for the outcome.
Quantity surveyor - manages costs relating to building and civil (as opposed to military) engineering projects, from the initial calculations to the final figures. Surveyors seek to minimise the costs of a project and enhance value for money, while still achieving the required standards and quality.
- Frugaleur - manages costs relating to building a safe and secure homelife, remaining civil throughout and engineering a Frugaleurs seek to minimise the costs of running the household and enhance value for money, while still achieving the required standards and quality.
Project Manager - the person responsible for accomplishing the stated project objectives. Key project management responsibilities include creating clear and attainable project objectives, building the project requirements, and managing the triple constraint for projects, which are cost, time, and quality (also known as scope). The project can be anything.
- Frugaleur - the person responsible for accomplishing the stated project objectives. Key project management responsibilities include creating clear and attainable project objectives, building the project requirements, and managing the triple constraint for projects, which are cost, time, and quality (also known as scope). This particular project is frugal living.
Accountant - a practitioner of accountancy (UK) or accounting (US), which is the measurement, disclosure or provision of assurance about financial information that helps managers, investors, tax authorities and others make decisions about allocating resources.
- Frugaleur - is responsible for finances and accounts relating to the household, measuring, disclosing or providing assurance about the financial information that helps them make decisions about allocating resources (the income).
Buyer - primary responsibility is obtaining the highest quality goods at the lowest cost. This usually requires research, writing requests for bids, proposals or quotes, and evaluating all information received.
- Frugaleur - primary responsibility is obtaining the highest quality goods at the lowest cost. This usually requires research, visiting all nearby supermarkets and stores, writing requests for bids, proposals or quotes, joining trading groups like LETS and evaluating all information received.
Analyst - an individual of whom the primary function is a deep examination of a specific, limited area such as finance. Analysts normally use spreadsheets and accumulated data to arrive at their final conclusions. Eg - budget analyst.
- Frugaleur - an individual of whom the primary function is a deep examination of a specific, limited area such as finance. Frugaleurs normally use spreadsheets and accumulated data to arrive at their final conclusions. Eg - budget analyst.
Auditor - carries out an evaluation of a person, organization, system, process, enterprise, project or product. The term most commonly refers to accounting, but similar concepts also exist in project management, quality management, and energy conservation.
- Frugaleur - carries out an evaluation of the entire frugal living and working project. The term most commonly refers to accounting, but also project management, quality management and energy conservation within the frugal household.
Chief Executive, Director, Administrator, Secretary, Dietitian, Chef, Housekeeper, Cleaner, Gardener, Interior Designer, Decorator, Caretaker... look up the definitions of any, or all, of these careers and you'll find something relevant to the job of running a frugal household. There are many more and we need to harness basic skills relevant to them all. On top of that, we also need to earn the cash that pays the bills in the first place, whether that be by selling or providing services (of the legal variety, let's not get too carried away). So, next time someone suggests to you that frugal living is just taking the easy way out, ask them what their job description includes and how much of what they earn is theirs for the keeping.
Salary - £XX,000
Actual Salary = £much, much LESS
Analyse the true cost of your job before you even contemplate calculating a responsible budget for your household. Factor in the regular savings so you've adequately covered all the major spending blips, like family occasions, celebratory events, holidays, extra car costs, annual veterinary fees for pet vaccinations, overnight visits, social events, concerts, unscheduled garage/veterinary/dental bills...
I'm not even going to attempt to guesstimate all of the above, as they vary so greatly depending on location, work and lifestyle. The bottom line is that many people still have debt that can easily spiral out of control if the worst happens and their main source of income disappears. The amount on any pay cheque means nothing unless that money is budgeted wisely. (I'll bet even the Beckhams can't claim to be completely debt free.)
So, in conclusion to anyone who may think that an attempt at making frugal living a fulltime job is a 'cop-out' and that it's about dropping out of the rat race, think again... being a frugal entrepreneur is something entirely different.
It doesn't cost much to stay debt free and accumulate savings, but it does take hard work and determination to succeed.
Remember - when you stay ahead of the game you can drop back into it anytime.
Are you a Frugal Entrepreneur?