Beating Broke

Personal Finance from the Broke Perspective

Four Strategies To Get Dinner on the Table If You Are Single

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When I was a graduate student, I rarely cooked for myself.  I lived alone, and while I don’t mind leftovers, if I cooked a meal, I would have 4 to 6 servings for leftovers, and I would bore of them before I finished them.  Likewise, my mom currently lives alone, and she almost never cooks.  She always says, “What is the point of cooking for just one person?”  Instead, she goes out to eat frequently and splits a meal with her dining companion to save money.

If you live alone, you might also dislike cooking for one.  However, there are strategies you can implement to still be able to eat delicious, cost-effective meals at home, avoiding the need to rely on frozen dinners from the supermarket or restaurant food.

Pay a Friend to Cook for You.  You may have a friend who cooks for his/her family on a daily basis.  Why not ask if they would be willing to let you “buy” a serving of the meal?  I cook for my family nearly every night to keep our food costs down, and if I had a single friend, I would be more than willing to make an extra portion for her.  She could pay me $2 a meal, costing her $10 a week for 5 meals.  She would benefit because she would avoid the hassle of shopping and cooking, but she would still get a tasty home cooked meal, and I would benefit because I would just make a bit more of the meal than I was already planning to make and I would earn $40 a month for my effort (less the small cost of additional food for her portion).

Swap with Friends.  Arrange to swap meals with friends, either at work, at the gym, at your apartment complex, etc.  Get together a group of 5 friends; each night one of the five friends cooks the meal and each person gets a serving.  The only cost to you would be one evening of cooking and the groceries needed to make that meal.

Freezer Cook.   Once a month, take a day to make freezer friendly meals such as lasagna, soups, etc.  Make four meals from recipes that produce 4 to 6 servings.  You now have 16 to 24 dinners at your disposal.  Just pull them from the freezer and reheat.  If you want to increase the variety, the first month, don’t eat all of the freezer meals.  The next month, try 4 new recipes.  If you saved at least one serving from each meal you made the previous month, you now have 8 meals in your freezer rotation to choose from.  Most freezer meals are good for 3 to 6 months, so you could have quite a bit of variety by the third month.

Cook for Two.  Invest in a magazine like Cooking for Two and make meals from there.  Now, you have one serving for your meal, and one serving waiting for another meal.  Obviously, this method is a bit more time intensive than the other methods mentioned, but if you like to cook but don’t like all of the leftovers, this may be the way to go.

Even if you live alone and don’t like to cook because you get bored with the leftovers, you don’t have to rely on take out and restaurant food.  You can save a bundle by relying on one of these methods.

What are your favorite strategies when cooking for one?  Have you ever implemented any of the strategies mentioned above?

(B.B. note: Those are some terrific ideas, Melissa! As a guy, most of those ideas probably wouldn’t have ever occurred to me when I was in college.  Mostly because, as a guy, I hardly ever cooked. I know, blame me for the stereotype.  The group of guys that I hung out with, however, did do quite a bit of grilling at each others houses when we could.  When I grill now, it counts as cooking.  What we did back then?  Not nearly as much.  More of a “throw it on until it looks ready” sort of deal.)

Renting or Buying a Home?

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Which is the better way to go? There are several arguments for both sides with people arguing that the added costs of homeowner-ship making renting the more expensive or that rent paid is money lost that could have been going towards building equity in your home. I’m on the homeowner side of things. We own our home. And, we do have a mortgage.

There are several reasons that we own a home.  One of the biggest is cost.  Our mortgage, taxes, PMI, and insurance all come to only about $500 a month.  To rent a home of equal size, in our area, would cost at least $650, if not more.  It’s more cost effective for us to own, if you only take that into account.  There are added costs to owning a home.  Repairs and maintenance are an added cost that is unavoidable, but I look at it as another investment into the place I live.  And, many of the improvements that we’ve done (see kitchen for instance) would have never been done had the house been a rental, and they’ve greatly improved the livability of the house. When it comes down to it, buying a home just makes sense.

I can clearly see the argument, in some parts of the country (and world) for renting over buying.  I can also see situations where renting is just the smarter thing to do.  But, for most, I just don’t see how it can work out in your favor.  Why put money into someone elses pockets, when you could be putting it into yours?  Even if your house doesn’t appreciate in value at all (or, even depreciates) you’ll still be left with something of some value when you’re done with it.  Over those same 15-30 years of renting, what will you have?  Nothing but a good renter history.

The mathematics of the rent vs. buying can get a bit complicated when people start talking about lost gains on investments and throw in interest, appreciation/depreciation, and the like.  I found this cool calculator that does most of that for you.  Hit the deluxe tab to really throw in a ton of variables.  If you’re a homeowner, punch in your numbers and see if it is worth it for you to buy or to rent.  I put our numbers in (that’s them in the picture), and, as I suspected, it’s better for us to buy vs. rent.  I have played a bit with it, and I think it’s a bit skewed towards buying vs renting, but not so much so that it makes it not fairly accurate.

I think another good thing that the calculator does, is give you a better idea of what the different variables can do to the situation.  Try playing with the appreciation numbers, or the return on investment number, or the length of mortgage, and see what that does to your situation.

Where are you on the rent vs. buy spectrum?  Do you own?  Why, or, why not?

New Home Sales Down

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So, are you surprised by that news?  That new home sales dropped like a rock in May?  I can’t say that I am.  I try hard to keep my politics out of this site, but what the heck were they thinking?  If you look at the chart that CNNMoney has posted, you can clearly see that, not only did they drop, but they dropped below where they were before.

And obviously, there is a very nice spike for a while.  Incentives do make a bit of a difference.  And, in all honesty, if we had been in a situation where we felt we could afford a new home, we would have jumped at the opportunity to take advantage of those incentives.  But the spike was just that.  A small percentage of people taking advantage of an incentive that made it very attractive to buy a new house.  What it didn’t do was return home sales to anything like previous numbers.  In fact, it didn’t even get the numbers back to 50% of what they were in 2000!  And now, after the incentives have expired, they dropped 33% to an all-time new low. The last time the numbers were this low was in 1981!

I think everybody has the right to purchase a home.  You shouldn’t be dis-allowed from purchasing a home.  But, you still have to pay for it!  Owning a home is not a right.  The ability to purchase one if you can afford it is.  Years and years of politicians buying votes by pushing lenders to finance houses to people who couldn’t afford them is what caused the housing market (and our economy as a whole) to be in the condition it is in.  And that crashs’ ripples are still being felt throughout the country and the world.  Creating incentives to buying a home just extends that streak.  People see that $8000 and think that they can afford a home that they really can’t because they will get a nice $8000 check to help pay it down.  But, when that money comes around, what are they going to do with it?  Spend it.

And in five years, when those mortgages adjust, we’ll have a nice little mess to figure out again.  Sure, it won’t be anywhere near as bad as the current one, but it’ll be there.  If only we could teach people to be responsible consumers.  To not buy what they cannot afford, and to only spend what they earn or less.  If we could do that, then they wouldn’t need those incentives to buy a home.  They might actually be able to afford it without them.