Ever since the founding of the United States of America, our economy has gone through cycles of periods of economic growth, known as expansions, and economic decline, known as recessions. The biggest recession in our history was the Great Depression, starting with the stock market crash in 1929 and leading to a reduced GDP, tax revenue and personal income. Unemployment reached a height of 25% before the Depression ended in the late 1930’s.
While our economy has never taken as great a hit since then, cycles of expansions and recessions continue to affect the market as well as the average citizen. The last recession, lasting from 2007 to 2009, stemmed from the collapse of the U.S. real estate market and resulted in many major banks being bailed out by the federal government.
Since then, our economy has been in a steady incline and is currently experiencing a period of economic expansion. GDP growth rate is in the ideal range of between 2-3%, unemployment and inflation continues to be low. The economy is healthy for now, but like history has shown us, sooner or later there will be another downturn.
While practices and protections have been put in place to ensure there’s never another recession quite so devastating as the Great Depression, there are still frugal living tips we can learn from the Depression to help us get through the next recession. Here are just a few ways that Depression era frugal living can help you save money:
Grow What You Can
The ability to grow your own fruits and vegetables in a garden was ideal during the Depression, and is still an excellent way to save money. Having a home garden can provide you with much cheaper produce and ensure that you’re eating high quality fruits and vegetables free of pesticides and toxins.
If you live in a rural area and have the ability to raise livestock, a milk cow or some chickens would provide you with an ample supply of milk, butter, cheese and eggs. Anything that you can grow or raise yourself rather than buy from the store will always be the cheaper alternative, and you might find that tending a garden or raising livestock becomes a hobby you grow to love.
Take Advantage Of Everything Free
If something is offered to you for free, take it. You can always find a new and creative use for things that most people discard, whether it’s finding people on Craigslist giving away free furniture to people willing to move it or repurposing those envelopes they send you in junk mail to mail back forms.
Never buy anything you can get for free, either. Opt for renting books from the library rather than buying them in the store, and schedule movie nights at a friend’s house instead of buying a costly movie theater ticket. There is almost always a cheaper or free alternative to the thing you want to spend money on if you just spend a little bit of time and energy looking for it.
They had to ration almost everything during the Great Depression, so nothing was thrown away until it had been used up completely. This is a great frugal mentality to have as most people waste a considerable amount of money on the things they throw away that you can still get more use out of. Fully squeeze the last of the toothpaste out of the tube instead of throwing it away. Fill your dish soap bottle with water at the end and get that last bit of soap out of the container.
Don’t throw away any food that you can keep for leftovers. If there’s enough for a meal the next day, keep it. Even if it’s just a side of broccoli, that’s one less thing you need to buy and cook for another meal and it’ll save you meal preparation time as well. Anything you can do to reduce the amount of waste you create will save you money in the long run and has the added benefit of helping the environment.
If you have the option of buying used, take it. From clothes to electronics, buying used can find you great bargains and save you a ton of money on things you don’t need. Shop for new school clothes for your kids at Goodwill and other thrift stores, especially considering how fast they grow out of them. Buying your next phone refurbished instead of new will save you hundreds of dollars that could be better spent elsewhere.
When buying used cars and other big-ticket purchases, always be careful to ensure the quality of the product you’re buying. If you’re looking to save money by buying used, you don’t want to end up spending more in the long run on repairs. Always try and get things under warranty, and take the time to research and price compare before buying.
Sell It Before You Toss It
Instead of junking your old furniture, try selling it. Sites like Craigslist or Facebook Marketplace are great places to sell furniture to people in your community who might be looking to buy. Living in a city, people put furniture out on the street all the time. You’d be surprised the quality of furniture that gets abandoned just because people don’t have the time or the energy to find someone to sell to. Taking in found furniture and reselling it can be a great way to make a little bit of money.
Before giving away expensive clothes you don’t wear anymore, you can try selling them at consignment stores. These can be great places to sell any designer clothes you have that may still have some worth. Even if you don’t think you have anything of value, you might find that one or two of your items are worth selling. It’s worth stopping by the consignment store on the way to Goodwill.
Make Do With What You Have
Before you get rid of your phone and replace it with a new one just because you want the latest model, try getting as much use out of it as you can. Use it until it breaks or slows down too much; the more use you can get out things, the more you’ll be able to save on the cost of replacing them. Just because something doesn’t function at 100% efficiency doesn’t mean it’s time to get rid of it.
While it’s nice to have the best and the shiniest of every new gadget, the money you save being frugal can be used to do so much more. Better to have an older phone and a less flashy car than to only be able to afford one or the other. If it works, it’s doing its job, and that’s all that matters. Being able to differentiate between wanting a new phone vs. needing a new phone will help you cut down on purchases you don’t need to make.
Because most people today grew up in a period much more prosperous than the Great Depression, they aren’t used to restricting how much they use on a daily basis. Having the mindset of consuming as little as possible is a great way of working frugality into your everyday life. While you don’t have to go full on Depression-era frugal living, making a concerted effort to be conservative in your use of things like detergent, soaps, and shampoos will help them last longer and reduce the amount that you waste.
The same thing goes for anything that involves the use of gas or electricity. Utility bills make a huge difference, and being frugal with the heating and cooling in your home will cut your bill substantially at the end of the month. Making a note to turn off lights and appliances when you’re not using them is a great way to conserve energy and bring your electricity bill down.
Cook As Much As Possible
Eating out was definitely not a staple of the American diet during the Great Depression; if anything, it was an incredible luxury. Take a frugal living tip from the Great Depression and treat going out to eat as a luxury today. Cooking at home is one of the greatest ways you can save money on food as it is almost always more expensive to eat out. Buy food in bulk and meal prep for the week in order to reduce those urges to order takeout or splurge at the drive-through.
You can even find several Depression era recipes online if you’re looking for inexpensive meals to make at home that have plenty of nutrients and a whole lot of history. Recipes like pasta with peas or a feast with an inexpensive cut of meat turn out to be delicious meals that are relatively simple to make. Try out a few of these for yourself and you might find a new meal to add into the weekly rotation!
When it comes to buying food in the grocery store, making the best decisions is vital to saving you money. Focus on the inexpensive staple foods to supplement what you have, like dried beans and rice. To ensure the quality and nutrition of what you’re eating, try buying the high-end organic version of the frugal item you want. You don’t want to sacrifice health for a dollar, so choosing a high-quality version of a cheap food will be better for your wallet and your body than a low-quality version of something extravagant.
Along those same lines, avoid the temptation to buy junk food. Even though they might be cheaper, foods high in sugar will cause you to be hungrier and therefore consume more. Making a grocery list of everything you need before you go to the store will help you stick to it and avoid wasting your money on unhealthy snacks.
Build Your Savings
One of the best ways to prepare for the next recession is to take the money you’ve saved being frugal and use it to build your emergency fund. Having three to six months worth of living expenses in a savings account you have quick access to is a vital asset to protect yourself from financial trouble. With every recession comes a rise in unemployment, and a savings account will help bridge the gap if you find yourself between jobs.
If you don’t have a savings account, you can find one with any number of online banks that offer higher interest rates than traditional brick-and-mortar banks. You can find several that require no monthly fee or minimum balance, so open one and start small. Set an initial goal of $500 and go from there, slowly building to your net savings goal over time.
Decide What To Do With Your Investments
The number one piece of advice for people wary about a stock market crash is to do nothing. The stock market rises and falls, just like the economy does. You’re playing the long game with the stock market, so pulling out all of your stocks at the wrong time can have disastrous results. Let your money sit where it is and be content knowing that the market will recover.
With that being said, if you’re within a few years of retirement age, you’re going to want to cash out your investments soon. You may want to consider moving them to a lower risk investment in the meantime. The closer you are to retirement, the less risk you can afford to take, as you don’t have the same amount of time for your money to recover.
Preparing for the next recession will leave you better equipped to handle the financial strains of a weakened economy without having to worry about financial instability. If you employ a similar mentality of frugal living had during the Great Depression, you’ll find incredible ways to save money and resources without having to make too many cuts to your life.