“31 Days to Financial Independence” is an ongoing series that appears every Thursday on The Simple Dollar. You might want to start this series from the beginning!
Last time, we continued looking at the average American family budget, going through each category and examining how one could trim the cost of typical expenses in that category. Here’s the “average American family budget” that we’re looking at, along with links back to the earlier entries on those specific areas:
Housing – $10,080
Transportation – $9,004
Taxes – $7,432
Utilities – $7,068
Food – $6,602
Insurance (including things like pensions) – $5,528
Debt Payments – $5,252
Healthcare – $3,631
Entertainment – $2,564
Cash Contributions – $1,834
Apparel and Services – $1,604
Education – $1,138
Vices – $775
Miscellaneous – $664
Personal Care – $608
TOTAL – $63,784
Today, we’re going to skip over cash contributions (a really vaguely defined category without a lot of room for straightforward cost cutting) and take a look at apparel and services. As you can see from the budget above, the average American family spends $1,604 per year on apparel and services, which averages out to about $140 a month. Remember, however, that this “average American family” includes single adults, married couples without children, and families with children, too. In other words, a single person is probably coming in below that, whereas a large family (like ours) is probably coming in above that.
So, what constitutes “apparel and services”? Obviously, clothing falls into this category, but so do things like dry cleaning, shoe repair, and tailoring.
Exercise #14 – Trim Your Apparel and Services Spending
The rest of this article consists of a long list of specific tactics that you can use to trim your apparel costs. As with the other savings articles in this series, it’s important to remember that everyone lives a somewhat different life and thus some of these tactics are going to seem useful and sensible to you, while others will seem like a stretch to you, and still others won’t apply at all. That’s okay. Ignore the ones that don’t apply. Make an effort to adopt the most sensible ones. Then, give the others a trial run and see if it’s something that can work for you. Commit to some of the challenging ones for thirty days and see if they work, or apply them during the relatively rare situations when those costs come up.
Remember, your overall goal is to cut back hard on the areas of life that are less important to you – the shallows – so that you can afford the “deep” areas of your life both today and tomorrow. Keep that in mind as you read each tip. Is this tip cutting back on something that’s really important to me, that amounts to a core life value? If not, why not cut it so that I can afford those things that really matter?
Let’s dig in.
Never go clothes shopping without a plan. This is true for any shopping excursion, of course: you should never go shopping unless you have a very strong grasp on exactly what you plan on buying. That way, you have a “mission” to undertake when you enter the store. You’re looking solely for the items that match what you’re looking for.
Doing this cuts down drastically on wandering and browsing, and stores of all kinds are designed to get people to buy more things when they wander and browse, particularly things that they don’t need and barely want. That’s the purpose of almost every feature of a modern store, from the layout to the ambient music to the location of particular items to the displays. It’s all about converting a “wanderer”/”browser” into a buyer, regardless of their desires.
You can short-circuit that by having a plan. Make up your mind as precisely as possible before you enter the store in terms of exactly what you need to buy and focus entirely on executing that purchase as efficiently as possible. That way, you have far less focus left over for unplanned purchases, which are often money dropped straight down the drain.
Switch to a “flexible” professional wardrobe. This is a strategy I used quite successfully during my last few years of professional work. In short, I essentially had a handful of “mix and match” elements that all went together pretty well to create the impression that I had a lot more clothes than I did.
For example, I had a few pairs of very basic dress pants, several fairly basic dress shirts, and a number of ties that didn’t clash with the shirts. By mixing and matching these, it gave the impression that I had more clothes than I did. This would have been even easier if I were in an environment to wear a jacket to work, as mixing and maxing shirts, ties, and jackets that don’t clash with each other makes your wardrobe look huge when it’s not really all that big.
Try to choose clothes that go reasonably well with lots of other things and you simply don’t need as many clothes because everything goes together. It’s easy to just throw together an outfit if everything matches.
Buy well-made and long lasting items if you’re buying new items. Some of the strategies on this list are for buying used items. Used items come with the implicit understanding that they’re not going to last forever and that’s okay – that’s part of the deal when spending a fraction of the cost.
When you’re buying new, however, look for brands that have a reputation for being very long lasting and sturdy and spend a little more for them. A shirt that will last ten years is worth paying 50% more for compared to a shirt that will last two or three years.
Spend some time researching brands that have a reputation for long-lasting apparel and make those brands your focus. At the same time, know how to identify well-made clothes. Learn to inspect seams and cloth to make sure that the items are going to last.
If you’re less fashion-conscious (like me), buy a repetitive wardrobe of stuff that just fits and works. My wife says I dress like Mark Zuckerberg. I take that as a compliment. For those unfamiliar, Mark Zuckerberg is the founder of Facebook, a billionaire many times over, and a person who essentially wears the same thing every single day. His closet is mostly just full of duplicates of the same items.
If you have a particular outfit that looks reasonably good on you and fits you well, just buy several copies of the same outfit whenever you find it on sale and wear them until the items wear out, then repeat. Since I work from home, I wear a plain t-shirt and jeans every single day, so I just buy well-made jeans and t-shirts when they’re on sale and wear them forever. It works really well for me and keeps the cost low.
When clothes become worn out, save them for “around the house” use. When a shirt becomes worn out, don’t throw them out. Save them instead for days when you’re going to be at home taking care of household tasks or just relaxing. Wear that old t-shirt or even that old dress shirt on those days. There’s nothing wrong with wearing a beat-up dress shirt to weed the garden or to walk the dog or to wash the windows or to do laundry. There’s nothing wrong with wearing an old t-shirt when you’re cleaning out your car or doing the dishes or helping your child with a school project.
As long as the clothes cover your body and are comfortable to wear, they’re perfectly fine to wear around the house.
When they’re too worn even for that, make a “rag bag.” Eventually, clothes become just too worn to even wear around the house. T-shirts and socks and other items eventually get holes in them or tear along their seams and they’re just not wearable any more.
In that event, convert them into rags. You can just toss them into a bin in the garage to soak up messes or cover the ground if you have to lay down. You can cut up t-shirts and hem the edges to use as cleanup rags and dish rags around the house. This saves on buying rags or paper towels and gets even more value out of your most used clothes.
When you shop for clothes, start at the secondhand store (particularly ones near or in upscale neighborhoods). Here’s a secret about secondhand stores and thrift stores: you don’t go shopping for the junky stuff. You ignore all of that. Instead, you browse through the shelves and hangers for the items that are stuck in there inexplicably, the items that are in great shape and on sale for a buck or two. There are always items like that in thrift stores and secondhand shops. You just have to look.
The ratio of junk items to quality items is much better at thrift stores and secondhand stores that are near upscale neighborhoods because people from those neighborhoods go to the nearest secondhand shops to offload their stuff, so you can go in there and often pick up things that are essentially new.
Sell off the nicer clothing you don’t regularly wear. Most people eventually build up items in the back of their closet that they don’t wear. Perhaps it’s uncomfortable. Perhaps it just doesn’t fit well. Perhaps it’s just not as well “liked” as other items in your closet.
Whatever the reason, if you’re not wearing it, you should sell it and get some value out of it. If it’s a nice article of clothing, take it to a consignment store. If it’s more worn, donate it. Even if you aren’t directly compensated, you’re still freeing up room in your closet.
Buy clothes for future seasons at the end of the current season. Quite often, as stores transition from stocking clothes for one season into stocking clothes for another season, they’ll have big sales on the clothes for the previous season to avoid having to send them back to the manufacturer. It’s almost always better for the store to actually sell the item at a discount than return it.
Take advantage of this. If your winter wardrobe needs a refresh, wait until the later winter months to buy clothes to refresh it. If your summer clothes need a refresh, wait until the later summer months to refresh it. You’ll find that retailers of all stripes have the clothes you need on sale right when you’re ready to buy.
Take advantage of tax-free holidays. In my state, the first weekend of August is a tax-free holiday on apparel, meaning you pay no sales tax on apparel items bought during that three day period. Stores take advantage of this and compete with clothing sales to maximize the number of customers that come in the door.
Because of that, it’s a perfect time to buy school clothes and do a bit of a wardrobe refresh. We often start by going to thrift shops the weekend before and buying clothes there, then fill in the holes in the wardrobes by hitting the clothes sales during the tax free weekend. We can often refresh our entire wardrobes for a fraction of the price of shopping for clothes on normal weekends.
Don’t assume “everything’s on sale” if you’re at an outlet mall. Outlet malls have a reputation of being places to find nice bargains, but the truth is that many outlet malls are just retail stores for their specific brands. While you might find some discounts, you’re making a big mistake if you treat everything there as being on discount.
If you’re going shopping at an outlet mall, keep your price guard up and make sure that things are actually at “outlet prices” before you buy. If you’re not saving much by shopping there, don’t buy there; you can often find better bargains by simply using the other strategies in this article.
Avoid clothes that require extra care as much as possible. One of the biggest money sinks of a professional wardrobe is upkeep. It can cost a lot to keep your clothes dry cleaned or to take on special cleaning practices yourself for specific garments. Even if there is no additional cost, there’s often additional time involved.
The best strategy here is to make sure that the garments you buy don’t require any additional care, particularly if that additional care requires you to pay for special services like dry cleaning. Just avoid such garments entirely and find other solutions for your wardrobe. Buying and wearing such clothes just turns into a time and money sink which you really can’t – and shouldn’t – afford.
Don’t buy expensive workout clothes. While it can be tempting to buy special clothes for working out, don’t do so unless there’s actually a need for it. A t-shirt and a pair of shorts or sweatpants is all you need for almost any workout activity.
Yes, there may be special cases where particular articles of clothing are useful or necessary for specific people or for specific workouts, but if that need isn’t there, don’t invest the money. Just wear a t-shirt and shorts. It’s pretty standard gym apparel and it won’t cost you an arm and a leg.
Swap services with a friend that can sew. If you need to adjust or hem an article of clothing, that might mean a trip to a tailor if you don’t know how to sew yourself (or don’t have the materials for it). That can be very expensive indeed.
A much better strategy is to become friends with an amateur who sews for a hobby and swap services with that friend. Offer to watch their children for an evening in exchange for a simple garment adjustment. Offer to fix their computer and clean off their viruses and popups in exchange for the labor portion of a major garment adjustment. You get the idea.
Swap clothes with similarly-sized friends. Many people buy clothes simply because they want to change their look a little. They want to experiment with new colors or patterns or designs.
One way to do that is to find friends that are very similar to yourself in size and do a closet swap. Simply exchange a bunch of items from your closet for similar items from your closet. Suddenly, you have a bunch of new clothes to wear and it didn’t cost you a dime!
Make simple repairs yourself. If a button falls off of a shirt, it’s not time to call a tailor nor is it time to throw away that garment. It’s time to get out a needle and thread and spend fifteen minutes fixing the problem.
Simple issues like a loose hem or a button that’s fallen off are issues that almost anyone can resolve themselves with a needle and a bit of thread. It’s not difficult to sew on a button or fix a loose edge somewhere – the ability to stick a needle through cloth several times and tie a small knot is pretty much all you need. If you need more help, look online.
Be proactive with simple repairs. Rather than fixing an article of clothing with minimal effort, be a little proactive. Sew that button on securely rather than just using minimal thread. Better yet, secure all of the buttons on that shirt with an extra bit of thread, because if one came loose, it’s likely that others will come loose as well.
Dry your clothes slowly. Instead of loading up your dryer and turning it on high to blast-dry your clothes, consider a slower approach. Hang them up on a line in your basement or use a drying rack or, at least, use a lower heat setting in the dryer.
While this might seem like an energy-saving tip, it’s also a clothes-saving tip. Think of the lint in your lint trap in your dryer. Do you know why it becomes so full? It becomes so full because the action of the dryer is literally beating fibers out of your clothes, causing them to wear out far faster. You don’t get “lint” when you line-dry or rack-dry your clothes and you get a lot less lint at a less intense dryer setting.
Come back next time when we cover all of the remaining categories at once – education, vices, and miscellaneous expenses!
The post 31 Days to Financial Independence (Day 15): Trimming Your Spending – Apparel and Services appeared first on The Simple Dollar.
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