A few weeks ago, my husband and I took a stroll in the Venice Beach canal area where beautiful, expensive modern homes are the norm. At one of the fanciest homes, a rich-looking couple were sipping red wine and enjoying an appetizer of large artichoke hearts with melted butter. A few blocks down, an elegant group of people were grilling salmon and sipping white wine. The atmosphere, food and people could have come from the pages of a lifestyle magazine. That’s when I realized I was staring at the “Joneses” and they eat well and sip a lot of wine!
One of the basic tenets of simple / frugal living is to NOT keep up with the Joneses – the Joneses being the mythic family next door who looks better, earns more and spends more than you can. It’s easier said than done. Who hasn’t lusted after the lastest gadget or handbag or [ insert your Achilles heel item here ] and envied those who seem to have everything? Of course keeping up when you actually can’t afford to is the path to disaster.
My husband and I avoid this trap with one major exception — food. This is one instance when it’s worth it to keep up with the Joneses. Eating well is something that everyone can do, regardless of income. Before I get into the reasons, here’s a brief rundown of other envy-inducing categories and why trying to keep up in those cases could lead to financial ruin.
1) Car – I knew a woman who leased an Audi in order to impress her higher-income friends. This is a big-ticket item that depreciates in value. While Mr. or Mrs. Jones may be able to afford it, you can only lease it or make high payments.
2) McMansion or any house you really can’t afford - A house is the biggest ticket item you’ll probably ever buy. If you can’t manage to scrape together an adequate down payment or keep up with payments once you’re in, you’re likely to be house rich/cash poor and one step away from disaster.
3) Designer handbags, clothing and shoes – If you succumb to this, you’ll end up with a closet full of pretty things but zero savings. And to really keep up, you have to keep buying new pricey items or risk being seen in last season’s outfit.
4) Technology - It seems like everyone has an iPhone these days. In terms of tech toys, this is not the priciest one but I’m using it as an example because a friend of mine was showing it off the other day. I admit that I’m intrigued by all the cool apps. However, what kills you is the costly monthly data plan. Some people can justify this but many can’t afford it. In my friend’s case, unfortunately, the iPhone is just another symptom of his financial life. He started contributing to his 401k retirement at age 37, has no savings, and is upside down on an SUV that he bought at full sticker price.
5) Dining out – Sometimes you want the nice atmosphere and fancy foods but eating at nice restaurants add up. Even if you find great ’recession’ deals, it’s hard to beat the low cost of eating in.
Food is the one area where I want to feel ‘rich’. Actually, I don’t even think the rich eat as well as I do. As I’m writing this, I’m realizing that my husband is my own $80,000/year personal chef!
Like the Joneses, we splurge on quality ingredients like imported cheese, olive oil, seafood and meats. However, if you do a apples-to-apples comparison, you still come out ahead by cooking versus dining out. For a swordfish steak with artichokes dinner, the ingredients cost approximately $30 total (resulting in two dinners for two people, i.e. $7.50 per meal). The same dish at a restaurant would cost $30 for one meal! And don’t forget to figure in tip and tax, which is quite high in my part of the country.
As for atmosphere, we eat outside as often as possible. Light some candles, bring a bottle of wine, set the table and enjoy your view. Your backyard can be a private oasis and as welcoming as any restaurant patio. And the same thing applies to your indoor dining area.
Yes, if you splurge on food, your grocery bill will go up. However, steak and seafood can still be the exception rather than the rule. Once you learn to cook well, you’ll discover many delicious yet inexpensive recipes. You may never own a million-dollar home but you can still eat really well, sip a lot of wine and dine alfresco!