How can you make Christmas special on a very tight budget? That’s what we’ve been asking ourselves. Here are our ideas for An Extremely Cheap Christmas.

Host a Christmas dinner instead of giving gifts. Hospitality is one of the best gifts that you can give, any time of the year. Welcoming someone into your home and to your table, spending time with them, hosting them, is always appreciated. This year, Christmas Day dinner will be our gift to our parents and siblings. We’ll be stocking up on food over the next few weekends to spread out the cost. Our parents have insisted on bringing food as well, which will help to defray costs. We’ll make it special too, bringing out the china, crystal and flatware that we received as wedding gifts. A well-set table is a joy for all – host, hostess, and guests! But, no matter how fancy or simple the table is, what matters most is the love in the hearts of all who surround that table.

Use the decorations that we already have. We have countless decorations, and each autumn we buy new ones for our collection. It’s a tradition of ours that we really enjoy. But not this year. We’re making use of what we have! Our house will sparkle at Christmastime for no additional cost. We have garland, endless strings of lights, 6 or 7 wreaths, a creche, candles, centerpieces, nutcrackers, and more. When we decorated our house last weekend, we opened every box and bag to see what we had. I discovered a bag of lovely ornaments still in their packages… and the receipt from 2006! Those ornaments were forgotten, but now they’re on display. And they look marvelous.

Cut out Christmas cards. Although a box of cards at Walmart is pretty cheap and postage is minimal, we’re saying no to this. We believe that no one will be devastated – or even mildly hurt - that they didn’t receive a card from us. This might seem harsh and short-sighted. But when you have no credit cards at all, and hence have no wiggle room if something must be repaired or replaced, many more things in your life become “optional”. We look forward to staying in touch with family and friends via personalized email messages, perhaps with a photo or two attached. Another idea is to create a family newsletter that you email to friends. The important thing is that you stay in touch – during the holidays and year-round.

Enjoy the holiday-related items that we already own. We have many of the TV specials from our childhood on DVD: Rudolph, Frosty, etc. And we have movies like “A Christmas Story” and “A Christmas Carol”. Watching these will be fun… and they’re paid for. We also have a book of traditional Christmas and Christmas-related stories and poems that are suitable for reading aloud. What a nice thing to do on a cold winter evening! If you don’t already have a book like this, download stories, poems and even kids’ activities from holiday websites.

Be thankful. Take time to consider all of the blessings in your life. Make a list if you wish, and you’ll probably find that it’s a long list. Things like home, family, friends, health, even job security… they’re all blessings. While you’re at it, perhaps you can make a list of wishes and dreams for 2009.

Penny and Buck wish you and your family

a blessed Christmas season and a Happy New Year!

I have a new job now - one that pays better. It’s 10 minutes further from home but the distance is negligible given the higher pay, and falling fuel prices.

Buck learned that no one at his company would get a bonus this year (except, of course, the big wigs). So he got a different job within his company. It’s a level move in some ways but if all goes well, he could get a raise in 90 days.

Despite getting my first bigger paycheck last week, we’re still clamping down on expenses. We are not out of the woods, not by a long shot.

Speaking of expenses… stay tuned for my Christmas post!

…And I was instantly surprised by that! I certainly wouldn’t have expected to cry about it, but such indifference? Somewhere in the middle would have been more like it.

After some reflection, and paying attention to my reactions over the last couple of weeks, I’ve noticed an attitude of indifference to a variety of problems that normally would have annoyed or angered me. Like: I can’t find my car keys. I lost my favorite purse-sized mirror. We forgot to buy ketchup – again. The only parking spaces left at work are at the end of the lot. A storm knocked out the power during Monday Night Football. You get the idea.

Things like these are trivial when you have a truly serious problem. Like being $800 short for the monthly bills. Like considering talking to a financial advisor about declaring bankruptcy. Like worrying about losing your house.

Losing my keys? Please.

A friend of mine invited a whole group of people to go to a haunted house. I said no because I’ve only been in a haunted house once, and that was enough. Too scary! And of course, it’s not in the budget. Buck told me that he was tempted to go just so he could say to some ghoul who jumped out of the darkness, “You think that’s scary? You should see my credit rating.”

Words like ”problem” and “scary” have been redefined. It’s all about perspective.

When we started comparing unit prices at the store, however, Doritos were among the most expensive. In the end, Buck chose cheese curls. They were on sale and were the cheapest snack that we could find. It was a big bag too, and yet the total price was cheaper than smaller bags of other snacks. Buck seemed a bit downcast about the choice - I guessed that cheese curls aren’t as manly as Doritos.

But surprise, surprise! When Buck got home he said that all of the guys enjoyed the cheese curls, some commented that they hadn’t had them in a long time, and the entire bag was eaten!

The lessons here are that cheap can be delicious… and don’t be afraid to try something a little different. You just never know what might happen.

1. We don’t go to restaurants. That means no fast food, no oversize portions, no tempting dessert menus, etc.
2. We don’t buy snack food on most weeks. If we do, we buy one item, and it must be on sale.
3. We rarely buy pre-processed, packaged foods, which are expensive and tend to contain plenty of fat and sodium.
4. We don’t visit the vending machines at work.
5. We’ve cut down on how often we drive our dog to the dog park, where we stand around. Instead we’ve been walking him more in our neighborhood to save on fuel.

What all those doctors and scientists say is true. Eat healthier, get some exercise in, and you’ll lose weight. Who knew?

And if you know that it’s an out-of-control, vicious cycle…

Listen to me, and listen good. Stop now. Stop before you max out your cards. Stop before you can no longer afford to pay the minimum monthly charges. When you can no longer pay the minimums and when you have no more credit available, your life will get a lot more miserable. If you think that paying high credit card bills is rough, try living on a cash-only basis while still having to pay all of your bills. That will be your future if you continue to live beyond your means via credit cards.

Here’s an example. Buck took my car in for an oil change this morning. The mechanic discovered that my transmission pan is leaking. Cost to repair: $52, on top of the oil change. The total was $86.90. Thanks to our second jobs, we have the money – but it’s a huge bite from our budget and some other “need” or bill will suffer for it. Of our 2 cars (neither is new) my car historically has had more problems. It’ll probably be the one to die first. When it dies, we cannot afford another car, either new or used. We cannot sell/junk it now to reduce expenses, because if we have only 1 car, then I can’t have a second job. I must have a second job to keep the cash flowing in, because there is no more credit for car repairs or anything else.

Trust me. You do not want to reach this point: when there’s no more “We’ll charge it” to get us out of problems and repairs. Everything must be done in cash. If we don’t have the cash, then the problem can’t be solved, the repair can’t be done, the needed item can’t be purchased. Period. No more falling back on credit, because there is no credit. If, for example, the fridge dies, we cannot afford to replace it. Sounds scary, doesn’t it? Yes, it is.

If you haven’t maxed out your cards and can still make the minimum payments, consider yourself lucky. There’s still time left for you. Find a way to stop or severely reduce your credit card use. Consult a financial planner or ask a trusted friend who is good with finances. Cut expenses wherever and however you can. Figure out how to live on cash only, or at least as much cash as possible. Be creative, be ruthless, be strict, be merciless, be whatever you need to be to not get into our situation.

I took this job because the commute to and from my old job totalled 3 1/2 hours daily (nearly half a workday), and the stress when I got there was overwhelming. Migraines were splitting my head in two almost daily; I’d turned into an impatient wench at home; and each day at work was punctuated with frustration and anger. I managed to stay there for 7 years because the pay was good.

Eventually though, I just couldn’t take it anymore. So I found this job two years ago. The pay was significantly lower but the added benefits were priceless – lighter workload, almost no stress, friendly people, casual dress, migraines are extremely rare now, my moods are better, and Buck and I can attend school here for free. When I look in the mirror, I believe that I look years younger – it’s amazing!

But an extra $45/month? Ouch. Forget getting ahead… how can you keep your head above water? Buck suggested that I look up the “cost of living index” online for a comparison. Now, I know very little about economics and I’m terrible at math. So someone please correct me if this is wrong…

According to the Consumer Price Index Summary released on September 16, 2008, in the last year the cost of gasoline has risen 35.6%, and the cost of food has risen 7.5%. (That’s the overview – those numbers do vary a bit in more specific charts within the summary.) If I understood the index summary correctly, a pay raise of 2.5% means that I’m even further behind financially than I was last year at this time.

Even if we weren’t in debt so badly, our finances would still be taking a huge hit due to rising prices and we’d be relying on credit cards more. And that’s what got us here in the first place!

Even if I had stayed with my old job, where I earned 33% more, that doesn’t match the rate that gasoline prices have risen (35.6%). It really is tough – if not impossible – to get ahead unless you win the lottery, steal the money, or inherit the money.

So what are we doing in response to our situation?

• I’m looking for a different second job that offers more hours. Buck will stay at his second job, because he’s working at a friend’s store doing behind-the-scenes database work, and can call off whenever he needs to work overtime at his full-time job. His friend is very understanding, because before Buck was hired, the database work wasn’t getting done anyway. So anytime that Buck is there, it’s a huge help to his friend.
• Buck is looking for a new full-time job. His promised promotion still hasn’t been offered, and we’re running out of time.
• Once I land a new second job, I’ll look for a new full-time job. The latter will take longer, and a new second job will mean more money rolling in, faster.
• We both will look for new full-time jobs that are as close to home as possible.

We’ve also discussed other possibilities for the future.

• Sell our house and move into a rented townhouse. We can’t do this now because the housing is market is so bad that we’d be lucky to break even, much less make money on the deal. Renting would mean less equity, but equity is nothing more than something to borrow against. Borrowing is what got us into this situation.
• Live in a more urban area where we can use public transportation to get to work – or even walk to work. We miss living in the city in some ways, anyway. Perhaps we could have just 1 car. And if we rented, property and school taxes wouldn’t be an issue.
• Sell what we can, burn the rest, and hitchhike to Mexico. We could live in a tent on the beach, and sell driftwood and seashells to tourists. (Okay, that’s not a serious consideration, but at this point it does sound pretty tempting.)

I was looking at some of those fallen trees today, both near my house and near where I work. How is it that, say, a big pine tree near my office snapped and fell to the ground, while other pine trees just a few feet away - trees of the same circumference and height – remain standing?

Plenty of factors must come into play - root strength, the condition of the surrounding soil, the health of the tree, etc. Whatever the reasons, it seems to me that it all comes down to flexibility. The vast majority of trees were flexible enough to not break under the strain. Some, however, just couldn’t bend enough to last.

We’re trying to bend as the financial winds (of our own making) lash at us. Tonight there’s going to be a windstorm in our very own house: it’s bill night. Will we be able to make this month’s $1700 payment to our debt reduction program? What will we do if we can’t make the payment? We don’t know the answer to either question.

We slashed our discretionary spending, we got second jobs, we buy generic foods, we have no plans to travel (even for an upcoming family wedding), and we’re praying (literally) that the cars and appliances all keep working. The last remaining luxury is cable TV. Internet remains a must because Buck often receives calls to work from home on evenings and weekends. Even if there was time for him to drive to work (and there isn’t – these are urgent calls), the price of fuel means that it’s cheaper to pay for internet and log in from home.

We’re trying to flexible. Let’s hope that we can bend enough to weather this storm, because it’s going to last for years.

To my fellow frugalites – specifically to those trying to recover from overwhelming debt - I wish you good luck and much flexibility during your own personal storm.

We used 5 oz. of kernels (about 2/3 cup) to fill the air popper’s cup. That was from a 23 oz. bag of generic popcorn kernels that cost $1.50. The portion that we used cost 23 cents.

We added 1/2 stick of melted butter. That was from a 1 lb. package of generic butter that cost $3.12. The portion that we used cost 39 cents.

The yield was 18 rounded cups of popcorn, and it cost us 62 cents. You absolutely cannot beat that price for a tasty, crunchy snack that was more than enough for 2 people.

Price comparison: At Buck’s office, a bag of microwave popcorn from the vending machine costs $1.50. That’s almost 3 times as much as our snack last night, for far less popcorn.

1. Eat a healthy diet.
2. Drink plenty of water.
3. Get plenty of sleep each night.
4. Limit sun exposure.
5. Don’t smoke.
6. Limit alcohol intake.

Simple and affordable! This article makes it sound complicated and expensive. It recommends 16 different products for various purposes, but mentions only 4 of the 6 essentials. Alcohol intake is not addressed, and I can forgive that. (If you drink heavily, skin health is the least of your problems.) But water – yes, water! – is not mentioned. Water keeps you hydrated, flushes toxins from your body, and facilitates bodily functions of all types, including your body’s ability to maintain skin health.

I don’t mean to suggest that you buy no skin treatment products. Far from it. There are some very effective products on the market. But if you don’t eat well, drink enough water and get enough sleep… if you’re often exposed to the sun… if you smoke and consume alcohol regularly… no product in the world will give you the “dewy, plump, perfectly smooth skin” that the article promises.

I’m not a doctor and this is not medical advice. It’s plain old common sense. And of course, no matter how hard you strive for perfect skin, genetics play a large part in your skin health.

Speaking of perfect skin, let’s take this a step further. Is it even possible to get perfect skin? Photo manipulation of models and celebrities sets impossible standards for beauty. Check out this enlightening slide show/quiz courtesy of Dove’s Campaign for Real Beauty. (God bless the people at Dove for that.)

And don’t forget the best way to look great: smile!