Wednesday, March 31, 2010

The Art of Eating In

How much did you spend the last time you ate out (and that counts your work lunch, too)? If it's over $10, you could have spent less and ate better.

I'm the Bay Area Minimalist, so I know it's hard to be frugal in the gourmet capital of the West Coast. But at the same time, the Chinese take-out in the south Bay is less-than-dwarfstarular. Even if you can afford to eat out (or eat in with take-out), are you really eating well?

I would really like to do a whole series of posts on the joy of just eating good food, but the first objective of this blog is to make sure that my audience understands that saving money is good, and it's good for you, too!

When in doubt, eat in. Make enough food for twice the number of people dining (Cook once, eat twice!) The costs scale logarithmically, and now you have lunch for the next day. When I was on overpaid SiVl engineer, I did this almost everyday. For four days a week, I ate delicious leftovers from the night before instead of spending $8 on lunch. That's $128 saved every month and I ate food that was better than the work cafeteria. (that's $1500 a year! I've bought used cars at that price.)

I got so addicted to good food that when I changed jobs where the lunches were catered, I still packed my own. A colleague confronted me, asking me why I packed a lunch when the food was free, and my reply was, "Not all food is created equal." Since then, I've read Michael Pollan's The Omnivore's Dilemma, and my reply today would be, "I prefer to eat food."

I like following Pollan's mantra: Eat food. Not too much. Mostly plants.

Food is anything--as Pollan says in his Eater's Manifesto--that your great-grandmother would recognize as food. If you can't pronounce an ingredient (and my readership is highly literate and scientific), then it ain't food. If it has more than four ingredients, it's pushing the boundary of food.

Portion control. When you're 80% full, you're done. Put the fork down and sip the wine.

Plants. Lotsa plants. I'm a vegetarian, but my foodie carnivore friends know that a chicken sandwich from a fast-food restaurant is not food, nor, presumably, does it contain much chicken.

Eating well is good for your Pliocene metabolism, but it's also better for our post-industrial wallets. To prove the latter, I'm going to do some math. (Ahhhh, math! don't worry, humans invented it. Just like hammers, it's a tool. Use it with caution.) I'll use the world's most perfect food to illustrate my point, setting the serving size four adults and two toddlers (tonight and tomorrow's lunch).

1) Eat out: $20. Prep-time: 10 min. (driving there and back)
A super delicious large pizza at Giavanni's Sunnyvale (best pizza in SV, sooo good!), after tax and tip, is $20. Good for parties and large groups, but night-to-night is going to get spendy--even at 1 night a week it's $80/mo.

2) Eat in, pre-made: $8. Prep time: 20 min (doesn't include trip to grocery store, but presumably you had to go anyway)
Two pre-made cheese pizzas at Trader Joe's $3.99 each, and are the equivalent of 1 large at Giovanni's--in volume, not flavor. Put them in the oven and bake them. Super easy, but it costs your electricity and gas for something that doesn't taste that great due to the amount of preservatives required to make it able to sit in your freezer for months.

3) Eat in, less pre-made: $6.57. Prep time: 30 minutes
Whole wheat pizza dough from Trader Joe's - $1.29
organic pre-shredded mozzarella cheese - $3.99
pre-measured sauce - $1.29
More work, but I find rolling out pizza dough to be fun, and in the winter having the oven on heats my home and my food, and I can splurge on toppings and still come nowhere near the pizza joint price.

4) Eat in, from scratch: $4.40. Prep time: 1 day
Using Peter Reinhart's pizza dough recipe from The Breadbaker's Apprentice yields two large pizzas, so the price above half of what you see here. I based all the prices on the most expensive, organic version of the ingredient I could find. (Thank you King Arthur Flour and Trader Joe's!).
Dough:
Organic KAF bread flour - $2.00
Sunnyvale fluoridated H20 - $0.000022
TJs Greek kalamata olive oil - $0.25
TJs kosher sea salt - $0.22
KAF instant yeast - $0.04
Sauce (My super simple and delicious no-sugar sauce):
1 lb tomatoes - $1.99 (fresh or from a can, the difference is 10¢
5 cloves garlic - $0.20
tomato paste ($0.89 or from my garden, priceless)
TJs Greek kalamata olive oil (0.22)
Salt and spices - $0.00 (negligable, I use pinches of them)
TJs Fresh Mozzarella balls in brine - $2.99

The preparation time time goes up proportional to the amount of money saved. Time is money, money is time. What do you have more of? While I generally don't have a lot of time to spare, I have even less money. I tend towards 3), but I love, love, love 4).

Here's the art part: Time spent cooking and baking is part of the soul in food. Shun "quick and easy" recipes and especially ready-made meals, as "quick" means microwave, and "easy" means processed. Neither are good for your body. I can't stress this enough, if you can't pronounce it, it's not food. While I used canned food for cooking, anything in the ingredient list beyond water, vegetable, and spices defeats the purpose of canning the food in the first place. Even sugar is excess. Try your recipes with less sugar and enjoy the savory flavors of the spices and the salt.

Food should taste good, but it must nourish the mind as well. The processed-foodlike-substance industry may have perfected the ratio of fat to sugar to salt to sate our Pliocene brains, but it doesn't satiate our hominid creativity. Homemade food always tastes a little bit different than the last time you made it. Spice your food. Make it taste perfect to your taste buds. Every time you re-make a recipe, change something to see what it does and appreciate the variety that home-cooking affords you. Ask--no demand--that your guests tell what they like and dislike.

When I make food myself, I have to share it. Tammy enjoys it. Viola enjoys it. My friends enjoy it. The greatest compliment I ever receive is when my daughter can't get enough of my homemade bread. I don't do drive-thru for lots of reasons, but the most important reason is that we evolved to cook and eat together.

If you don't have time to cook, may I ask what you do with that time that you save by eating out? If you're working an extra job to pay the bills, then that's one thing, but if you're watching TV or surfing the net alone, maybe you need to rethink your relationship with people and your relationship with food.

Eating out is fun, too. The restaurants that I love I really love. They make food I can't make. They have atmosphere that I can't replicate. They have wine I can't afford by the bottle. I save those restaurants like I save my money, it's there waiting for me when I need it. But most nights, I turn on the burner 'cause I'm cooking with fire.

When I practice the art of eating in, I feel more connected to my people. I tell Tammy about Viola's and my day over a savory dinner. Afterwards we do the dishes, a healthy reminder that once again, we ate well.

Our culture is obsessed with having things (kitchen utensils are my pleasure). If you're a kleptocrat, the next post is for you. It's all about how to die with the most amount of things your dollar will get you.

Monday, March 29, 2010

Credit cards: taking my own advice

The next topic is in the works, sorry for the delay. Viola's birthday party consumed most of my time. In fact, I got so distracted I forgot a credit card payment. Mint.com notified me via email of the late fee. That was odd, but I logged in to my accounts and sure enough, I hadn't received my March statement. What happened was that I had just switched over to online statements (good things overall, less paper), but it seems Yahoo! mail didn't white list the email address correctly (typo, my bad) and I instead got a late charge and an interest payment. The white list was easy to fix, but would the bank be as cooperative?

About ten minutes ago, per my own advice, I called up the issuing bank and asked them to reverse the charges. Which they did! It was a quick fix. I find that being cloying on the phone doesn't hurt. I didn't raise my voice. I know the squeaky wheel gets the grease, but the CS reps hear that all day. When I'm nice, I 9 out of 10 times get nice service back.

PS This also applies to when you call you House representative or Senator. Those poor interns get yelled at all day. Say your piece and wish them a great day, too.

PPS Senatrix should be a word. I have two of them.

Monday, March 22, 2010

Credit cards

You've probaby heard that you need credit cards to build credit history. Then you get a credit score, and then you start borrowing sums greater than $20 from your best friend. This wasn't always the case--plastic used to be very expensive to carry. You had to buy a washing machine from Sears and pay it off monthly to generate good faith credit.

But this 2010. Even this Luddite carries plastic in his wallet between gold doubloons. I'd rather build up my credit without having to buy a major appliance every year. But why? What good is good credit?

Credit allows me to borrow money from my bank to buy something I normally can't afford without saving for years, e.g. a used pirate ship. I want to get charged the least interest possible, especially because as a new pirate, I'm learning the ropes and don't want all my hard-earned plunder going to a landlubbing bank.

While banks say they prefer people with good credit, they make less money on honest pirates. The safer the bet, the lower the returns. The entire financial sector demonstrated this sort of roulette thinking with the sub-prime mortgage credit default swaps. They didn't learn their lesson: pirates with good credit still have lower rates of return. They just up the fees on us--because we always pay. Then they spin the wheel, betting on risky lenders.

They'll do all sorts of crazy tricks to get you to part with your loot. Take, for example, all the stupid credit-card checks my bank keeps sending me in the mail. These are terrible. Don't ever use them. They start accruing interest immediately, they have finance charges, and psychologically they look like checks but they're not: they're instant debt!

Rule zero: the bank is not your friend. At its best, your bank is a business partner, but a shady one. He's the guy on the corner selling hot speakers out of the back of his truck. He swears that he acquired them honestly and he's just passing his good fortune onto you. He's lying. Bank will lie to you in the same way, the only difference is since they influence large swathes of government, their lies aren't illegal.

In today's age, it's unfortunate that we have to carry plastic instead of gold-plated latinum, but it's hard to find a Ferengi to trade with. Terrestrial banks need finance charges and ridiculous interest rates on carry-over balances to keep their gluttonous CEOs from jumping off the Empire State Building. But you don't have to contribute to keeping caviar on their plate in order to take out a boat loan. It's even possible for you to legally leech off the system. Here's some tips to keep them from getting yours, and get a tiny crumb of the pie for yourself.

1) Never carry a balance. While paying your minimum will keep your credit report in check, it's handing your money to bank on a silver platter. What did they do to deserve 20%-30% interest? They gave you a piece of plastic. My credit union works harder for car loans in 4% range.

2) As I already said, don't use credit-card checks, or instant cash (if your card has a pin that works at ATMs). Every time you do this, a bank CEO plucks the wings off a fairy.

3) Carry a card that has some sort of rewards program but no fee. Some of my friends like airline miles. I have two cards, one gives me 1% back on all purchases, and the other gives me credit at REI. An aside: My bank has been trying to get me to switch to a "better" card instead of the one with 1% back. It looks like a deal, but the bargains drop off after six months and the rate is less than 1% and it's only valid at certain merchants. When in doubt, rule zero.

4) Don't have more than two cards. More cards work against your credit rating. Two is good in case the magnetic stripe on one doesn't work or there's fraud and you need a working credit card.

5) Never give money to the bank. That's why you don't want a fee, even if the airline miles are so enticing. Fight all finance charges, even if you're in the wrong. Cancel if they disagree. My friend missed his payment by a day. He called them up to have the fee reversed, but they didn't budge, so he canceled the card right then and got a new one from another bank. That's the right thing. A month later, the same thing happened to me with the same card, but the difference was that they reversed the charges immediately. Why? I have other large accounts with that bank, whereas my friend didn't. Sometimes banks play the loyalty card in your favor. Use it.

6) Pay cash at small businesses. That 1% I get back is actually paid for by the merchant. So if I take a little bit out of big-box store's profits and the banks profits, I feel good about it. If I do that to my local Lebanese restaurant, I feel pretty guilty, especially because the banks charge higher rates to smaller stores.

7) Actually look at your credit card statements. I do my banking online, but I take time once a month to make sure everything looks right. I caught a major fraud charge this way two months ago. Don't pay for someone trying to cheat the system. Lehman's and AIG don't appreciate the competition.

If you never carry a balance and never pay finance charges, you're the bank's worst customer. Congratulations! While they still make money off the merchant for the right to take credit card transactions, it's not your dime.

If you can't pay your balance at the end of every billing cycle, you're living beyond your means. Go back to my previous post on budgeting for help figuring out where you're overspending.

There's a few directions we can go from here. What banks are better, or how to spend less, or how to live with less things. But we're going to come back to these important topics later. It's time for a diversion. Next up: The Art of Eating In. UPDATE: Between the two posts is where I suck it up and take my own advice, I called the credit card bank! UPDATE 2: The bank tried to take my money again. Read about it here and here.

Tuesday, March 16, 2010

Budgets

Back in 1999, I used to do monthly budgets using spreadsheet software on my computer. I meticulously kept it updated, putting in each receipt, all the way down to the last penny.

A normal (there are no tangents in my world): Tammy designed the spreadsheet to break out how much we owed based on how much we each took in. I was an overpaid SiVl engineer at the time, so naturally my share was higher. One hot summer day in 2000 I was pouring over the spreadsheet trying to figure out how we'd get Tammy through community college (much less Stanfurd, by Pollux and Castor that was expensive!) and I found a major math error. The details are lost in time, but basically we weren't actually multiplying 2/3 by my income or 1/3 by hers (or whatever the ratio was). Since we overwrote the speadsheet every month, we had no way going back in time. Tammy cried, as she had no idea if she'd being pulling her weight (she could have under or overpaying, we couldn't tell). In the end we merged our finances, we were in this together. Later the same year I proposed to her, but tax shelters are another post.

Time went on, Tammy graduated, we made more money, we bought a house (or our bank did), I updated the spreadsheet less often, and by 2009 I was lucky if I could remember to check in once a year. Keeping it up-to-date took time away from actually living my life, which is kind of the point of saving money, so I can spent it on fun and important things.

Enter Mint.com. I was at first wary putting all my online financial info into it, but I can't live without it now. I've created budgets for our gas and grocery and a bunch of other categories. I still have to put in manually cash purchases, and that's a bit of an annoyance as they haven't really made that interface very smart. (First I have to split the purchase, then afterwards I can date it).

But the automagic stuff is awesome. It pulls in info from most of my banks (my credit union isn't supported yet, grrr), categorizes it, and lets me view from a hundred different angles. For example, We're overbudget this month for restaurants (thanks to a very fun but very expensive trip to Pizzetta 211 with Viola's 2nd cousin). I can compare my spending to previous months, and I can roll over any underspend category into other month.

The big shocker for me was when I realized how much we spend on food. I thought we spent $150 max, but most months we're pushing $500. Since Tammy and I are saving up to one day move to East Bay, it's good to know this. I don't want to stop eating well (more on that in a future post), so with a little math-- (groceries+restaurants)*12/income, I quickly see that this is 10% of our pre-tax expenditures. Not bad, but maybe we can do better.

At this point though, it's pretty simple. DON'T SPEND MORE THAN YOU MAKE. If you do figure out why using a tool like Mint.com or a spreadsheet or Quicken. Otherwise you'll go into credit card debt. And then you're pissing your money away to the banks who have done nothing at all to deserve your hard-earned cash.

Next time, credit cards! Why they suck, and how to use them to your advantage.

The Minimalist

I applied to be a guest blogger for We the Savers, the blog for ING Direct, but a different father, vegetarian, 30-ish white guy got the job instead of me. I look forward to following Matt's posts, but I was kind of looking forward to passing on savings advice to a wider audience--not just the three people who semi-regularly read my blog.

My regular blog has been languishing for a while, as I don't really want to broadcast stuff about my daughter for the whole world to read, so I thought I'd try out something new. I call it "The Minimalist", a phrase coined by my mother-in-law to describe how Tammy and I live. But it's not about austerity. It's about how we thrive on the minimum amount of money possible. It drives everything from how we take vacations, to our delicious homemade dinners, to how we're raising our daughter. And how we do it all sinisterly (i.e. from the left).

For those who don't know me, I'm a thirty-something stay-at-home dad living in the Bay Area. I'm married. My daughter is about to turn one, and I consult occasionally for a Palo Alto startup. I never eat meat, I eat fish rarely, and I love to to cook, but I especially enjoy baking bread.

For my first post, I'll take about budgeting.