Inverse Investing – Seven Easy Ways to Save Money
Quitting Your 9-5
Investing In Yourself Will Yield More Revealing and Immediate Results
It’s Your Future
Financial Advisers will talk a lot about how we can all do better about investing for our future. “Invest for retirement.” “Find the right mutual funds.” On and on. That’s important, I agree. But what advisers should talk more about is the idea of ‘inverse investing’ or more directly said: different ways to save money. Part of our cultural issues stem directly from our spending habits. The banks and institutions have setup countless products that allow consumers to get into debt for any reason or for no reason. Consumers can actually pay off credit cards with credit cards. But what if we could invest in our lives in an way that provides immediate and constant returns?
The Ebbs and Flows
Nearly everyone goes through times in their life where finances are tense and we start looking for ways to save money. Perhaps cash isn’t coming in as quickly. Maybe a family member was laid off or their hours were reduced. An accident or disability could just as easily cause a family to lose a significant portion of income or savings. If any of this happens, what do we often do? We tighten our belt, reduce our expenses, stop eating out as much, etc. But once the money flows again, we let loose and catch back up to the high-consumer life. Ahh, feels good to be back on top right? Maybe for a while, but it’s a cycle and it will happen again. You’ll look back and wonder how nothing has changed. Let’s take some time to think about how we can divert this problem.
I’ve heard the question quite a bit when someone has a nice chunk of money that they’d like to invest. They don’t want to lose the investment, but they want X% return within a certain time frame. Yeah, they could dabble in the stock market and watch their money grow at a snails pace. But I love the idea of Inverse Investing in that we invest in the things that give us an immediate return by saving us money over time. Think of it this way: everything is going well, money is flowing in, Starbucks cups are piling up in our trash can. When trouble hits the fan, perhaps Starbucks is the last thing we want to cut out? What if we instead invested in making our own great coffee at home or work? Coffee isn’t rocket science. If instead, we put the $5 a day toward a nice coffee maker and invested in our knowledge of how to make that frappe or delicious latte we could save at least $5 a day and we’d be proud of ourselves for learning a new skill. I did this exact thing since I loved drinking latte’s every day. Instead, I bought an AeroPress from Amazon and a milk frother to start making my own latte’s at work. Think about that. Less than $50 of product used daily could save me over $1500 a year. Do you know how much money you need invested at say a modest 7% return to make $1500 in a year? Roughly $21,000. Saving money daily on a habit like coffee is just a starting point. Think about where else you can invert your thinking to invest in ways to save money and also enrich your life in the long run. Check out a small list of examples below.
Investing in your future through knowledge and skills will pay more dividends than the stock market ever could
Your Future Depends on What You Change Today
Every single day you have the opportunity to invest in your own life through skills, knowledge and relationships. Don’t let a day slip by that you haven’t asked yourself about how, who and what you’re investing in.
Cooking Utensils – Learn more about cooking at home and save money from eating out
Car Wash Kit – Wash your own car and enjoy the fresh air outside, maybe get a tan if you’re as white as I am
Spice Cabinet – Invest in spices that make your home-cooked food taste delicious
Water Dispenser – Fits 5 Gallon jugs, saves you from constantly buying those small bottled waters and you can also get a little exercising filling and carrying them home. (It also doubles as an environment saver by reducing plastic garbage)
Recycled Toys – If you have kids, check the second hand stores or people who have older kids and see if they have extra toys they aren’t using. Our son will literally play in a box from Costco instead of some brand new toy we bought him.
Home Exercise – Save on gym memberships by finding ways to exercise at home. Borrow DVDs from friends, use YouTube. Run to a local park and bring the kiddos! Or lift the kiddos, man they get heavier by the day.
Movies – Did you know your local library may have a lot of newly released movies for rent for free? Yeah. Check it out.
There are a lot of little ways to save a dollar here and there. If you save a dollar a day in 10 different ways you’d be saving $300 a month. That’s $3,600 a year and you’re better off because of it.
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With BeardedBudget, I have developed a number of financial and merchant relationships; some of which are affiliate relationships. The opinions expressed here are mine alone and should not be construed as professional financial advice but honest reviews and recommendations based on my own experience. For more information, read the disclaimers and disclosures.