THE FRUGAL LIFE NEWS
Published Weekly by Randal Watkins
For The Frugal Life Website
June 6, 2002
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CONTENTS OF THIS ISSUE:
* A Note From Randal
* Finances: Mortgages, Taxes and Bigger Homes
* Gardening: Make Some Brush Piles
* Simplicity: Make Your Money Last Longer
* Frugal Tips – Batteries and Detergent
* Sharing What You Know
* Answers to Previous Questions
* Subscription info
A NOTE FROM RANDAL
Thanks for all the contributions and encouraging words. As a result of your
contributions, I decided to create some new web pages for Rust Spots and
Well Water. I will continue to add pages to the site as more content is
I want to ask if any of you know what to do with soil that is holding water.
I planted a dogwood tree 3 months back and saw it was doing poorly and when
I removed it I had to “ring the roots out.” Everytime I watered it and fed
it the liquids were choking the roots.
I want to put a dogwood in the same place but I really don’t know what to do
with that much standing water except to build it up with a berm. Do any of
you have any ideas on the subject?
Look forward to hearing from you.
Just post your question/answer at our new bulletin board here .
Until next week!
FOCUS ON FINANCES
Mortgages, Taxes and Bigger Homes
The Dollar Stretcher
by Gary Foreman
We have very nearly paid off our mortgage! We put a lot of spare money into
it because the mortgage had a higher interest rate than any safe investment
we could find. But for some personal reasons we would like to have a
different house, probably one that is nicer than our current one. My
husband says that since interest is tax-deductible, getting a new house
makes financial sense especially with today’s fairly low interest rates. So
he’s all for it. To me, as much as I’d like to have a new house, it feels
as if we have finally “caught up with our tails” only to begin chasing them
again. Can you give us some perspective? Thank you, Rebecca
Congratulations, Rebecca! It sure does feel good to own a home without a
mortgage. Financial life is much easier without a mortgage payment.
On the other hand, she and her husband have a lot of company in wanting a
bigger and better home. According the National Association of Home Builders
the average home has increased in size from 1,500 square feet in 1970 to
2,265 square feet in 2000. That’s a 50% increase in just 30 years.
Rebecca’s husband isn’t the only one to think that the deductibility of
mortgage interest makes a more expensive home a good deal financially. But
sometimes the ‘conventional wisdom’ isn’t really wise. So let’s pull out our
calculators and take a look at mortgages, taxes and housing prices.
We’ll assume that Rebecca is in the highest tax bracket. That would mean she
gets the biggest possible benefit from the deductibility of mortgage
interest. In 2002 the top bracket is 38.6%. So for every dollar of interest
that Rebecca pays the mortgage company her tax bill would be reduced by 38.6
cents. Not such a good deal. In fact she could cut out the middle man and
just give a buck to a friend. I’m sure that the friend would be willing to
give her 40 cents in return!
Is it really that simple? Probably not. There are other factors to consider.
Some people would argue that it’s still a good deal because of the benefits
of using OPM (other people’s money). That’s an old idea. And one that does
indeed work well when prices are increasing.
Let’s see how it works. Suppose Rebecca buys a house and she’s paying a
mortgage at 8% per year. But with the tax deduction the true cost of the
mortgage is really 4.9%.
How did we get the 4.9% figure? To calculate the true cost of your mortgage,
first you’ll need to know how much your deduction will be worth. To get that
multiply the interest rate on the mortgage (in this case 8%) by your tax
bracket (38.6%). That works out to 3.1%. Next you’ll subtract the deduction
rate from the mortgage interest rate to get your true cost to borrow (8.0%
minus 3.1% = 4.9%).
Now back to OPM. For Rebecca to benefit from the money she borrowed the
house would need to appreciate by more than 4.9%. Is that possible?
The Office of Federal Housing Enterprise Oversight publishes an index that
compares housing prices going back to 1980. For the first quarter of 2002
housing prices across the U.S. had increased by 171% compared to 1980. That
works out to about a 4.4% annual increase in price. So it would be close for
There were some regional differences. Some areas did quite well for awhile.
But others did not. For instance, in the Northeast prices dropped after
1989. Prices didn’t return to 1989 levels until 1998. So all housing markets
aren’t created equal. Even though you can’t predict the future, studying the
history of your community should give you an idea of how lively the housing
As Rebecca has pointed out there are also personal reasons to want a nicer
home. And only she can put a value on what a nicer home would mean to her
Should Rebecca go ahead and buy the bigger house? That’s up to her. But if
they are going to do it, her husband is right. Low mortgage rates does make
it easier. Whatever they decide I hope that they enjoy their home and it’s
never a financial burden to them. ___________________
Gary Foreman is a former Certified Financial Planner who currently edits The
Dollar Stretcher website. You’ll find hundreds of practical money saving
FOCUS ON GARDENING
MAKE SOME BRUSH PILES
Don’t throw your yard trimmings away to be buried in a landfill. If you’ve
got an “unnoticed” corner of your yard, you can provide shelter and cover
with a brush pile. Even if you can only leave it for the winter when it is
most needed. A few branches, debris from the summer garden, and the
discarded Christmas tree will be welcome shelter for winter feeder guests..
The arrangement can determine how large an animal you want to shelter. If
you have rabbits you might want to build a little “cave” with the brush.
Regardless, you will provide room for birds and lizards.
For more info on uses of and building a brush pile:
FOCUS ON SIMPLICITY
MAKE YOUR MONEY LAST LONGER
by Donna L. Watkins
There are so many ways to save money, and the least effective one is finding
things on sale. We have to learn how to find and use what we already have.
It’s a talent lost in our present culture of wanting more. Find a few ideas
below to stimulate your own creativity to do what fits for your own family
We have been recycling paper for many years, as many others have, but we’ve
found that most folks don’t think about using the paper before recycling it.
Do you realize how much junk mail passes through the home or office that has
printing only on one side? We keep it and use it in our printers. Most of
what we print is for ourselves and for our files, so we save having to buy
reams of paper. We also do this when we print something for somebody else
that we know, so it will be a topic for conversation, which gives us the
chance to teach that recycling and concern for the environment is
important….and that frugality can be fun and not embarrassing. We set the
example and that opens the doorway to teach that it’s okay to choose
voluntary simplicity instead of ‘keeping up with the neighbors.’
While we’re discussing paper for printers, you must check out the refill
options for those ink cartridges…it’s much too expensive to keep buying
We also save all those envelopes included in junk mail. It costs more for a
label than it does for an envelope, so it’s not frugal to use them in place
of envelopes for mailing and the post office doesn’t like it either.
However, we’ve used envelopes for sorting things, dropping off a night
deposit at the bank, passing a note or a check payment to somebody. We
cross off the address with a squiggly, creative flair and write the name of
the person we are going to give it to. You can file canceled checks in them
or coupons by different categories. I’m sure you’ll think of more uses for
them. This also sends a message of “waste not, want not” to our nation of
If you like spiral notebooks because of the hard surface, find a pocket
portfolio and put junk mail in it to use. It’s actually nicer than the
spiral since you can arrange the papers/notes in any order you want and
still have them orderly in the portfolio.
We never buy note paper. We have little boxes sitting by the telephones and
put any scraps of paper that we find with a clean side up to write on. Some
paper isn’t the right size for a printer. There are all kinds of different
scraps of paper to provide for your note paper box: extra deposit slips,
the backs of receipts, small junk mail envelopes, the backing on check pads,
etc. Just begin the process and you’ll find many opportunities for free
paper and you’ll feel good about saving money and trees. You can lay sheets
by the phone and while you’re on one of those long conversations, you can
tear them into note size making good use of your time while listening to a
friend. Feel good using some of the junk mail instead of just recycling it!
Do you know that many people have eliminated trash pickup by recycling
garbage in a compost pile and recycling almost everything else they use. You
can keep a large trash can outside with a plastic bag inside that will take
a month to fill….and then you can haul it off to the community dumpster
which is free, thereby eliminating trash pickup fees which have really
become high in most towns.
Since we decided Voluntary Simplicity is the way for us, we have also been
concerned about being frugal with the environment. That has required some
choices where we had to choose between frugalities for conservation reasons
or the pocketbook. It’s been an interesting journey which began when I read
“If every household in the US replaced just one roll of 500 sheet virgin
fiber bathroom tissues with 100% recycled ones we could save: 297,000
trees, 1.2 million cubic feet of landfill space (equal to 1400 full garbage
trucks), and 122 million gallons of water (a year’s supply for 3500 families
It doesn’t take much to make a difference!
We began using recycled toilet paper, tissues, napkins and paper towels.
They cost a little more, but somehow they give us a really deep feeling of
satisfaction for helping the world God made for us to enjoy. Most recycled
papers are not bleached with chlorine which is beneficial to the environment
and our health also. I like the absence of dyes and fragrances, yet another
elimination of chemicals in our homes. The toxicity of our environment does
not go unnoticed by our physical bodies since research has shown that as
chemicals increase so does cancer.
We’ve replaced a shelf full of cleaners by buying one simple
We use it for laundry, hand soap, window and car cleaner, and for
disinfectant qualities we make it up in a spray bottle with href=”http://www.theherbsplace.com/essential.html”> antibacterial essential
Since we use herbs and vitamins we make sure we recycle those bottles, but
first we like to use them for something. We enjoy making snacks from dried
fruits and nuts, so we use the bottles for them instead of plastic baggies.
You can use them for many things if you get a little creative. Our herb
bottles have a 2″ wide opening, so they’re great to put in drawers to
organize paper clips, tacks, rubber bands, buttons, etc. and can be used for
pencil holders and flower pots for beginning seeds.
Let’s allow our minds to become creative again as they were in older days
when ‘things’ weren’t so available and our nation didn’t have a disposable
mentality. Frugality begins in finding use of the things we already have in
our possession, not just saving money on obtaining more things. You not
only feel good about doing more with what you have, but you’ll be surprised
at how much more time and money you have when you don’t have to spend gas
and time shopping. You’ll also find that you can reduce your car insurance
if you put less miles on your car each year.
I firmly believe one of the main reasons our ancestors lives were so much
more peaceful is because they didn’t shop every day or week. Get rid of the
“have it now” mentality and make lists of what you need and schedule a time
weekly at first and eventually less often to shop. It will happen
automatically as you stir your creativity to find things you can substitute
that are already in your home.
Make your money last longer — you can have more fun times with your
family, and you can give more to organizations your heart cries for.
Donna L. Watkins is the editor of two free email newsletters: “A Healing
Moment,” on health and healing, and “A Touch of Nature” for those who love
the natural world around them and want to know more about it. Read more
about these ezines here:
FRUGAL TIPS – From Our Subscribers
USE RECHARGEABLE BATTERIES
It’s best to buy reusable alkaline batteries for common sizes AAA through D.
They can be recharged over and over, 25 times or more, saving money and
resources. And they’re not made with toxic cadmium like old-style nickel
cadmium (NiCd) rechargeable batteries. – Donna
Visit “Get Green” to find more tips that will help you save the world AND
save money at the same time:
BUY LARGE SIZE LAUNDRY DETERGENT AND THEN REFILL
I buy liquid laundry detergent in the huge value-size jugs. I refill a
16-oz water bottle with the detergent to take with me to the laundromat; I
save money on the detergent and save my back by taking small quantities with
me to use. – Lisa
Pleae contribute your best and favorite frugal tips!
Just post your tips at our new bulletin board here .
SHARING WHAT YOU KNOW
Please post your questions/answers to our new bulletin board. You can find directions here.
Q. When I get flowers from a florist, they include a little packet of
powder that makes them last and look good for so very long. Surely there’s
a simple answer to this. Does anyone else in this frugal community know how
to make your own powder? I like to gather wildflowers and would like for
them to last longer. Thanks! Dee W.
Q. I use olive oil for a moisturizer on my skin. It does a great job and I
get compliments all the time. I would like to use an essential oil in it to
keep it from going rancid. Right now I’m using Sandalwood because I like
the smell. I’d like to use one that would also benefit my skin. What
essential oil will do that? I tend to have dry skin, not oily. Anybody
know? Thanks! — Lee
ANSWERS TO PREVIOUS QUESTIONS
Q. I have a problem with rust spots on my clothes from the dryer. I have
tried CLR and various other things with no luck at all. If you know what
will take it out I would sure appreciate the help! Thanks
1. Oxy-Clean is great for removing almost any stain. – Natalie
2. There is a great product called “Whink” that removes rust stains on
practically anything. It can usually be found in the laundry/stain
remover section of your grocery store or Wal-Mart. It comes in a
bronze colored bottle. I use in on clothes, on countertops and in the
bathrooms. Just be sure to follow the directions on the bottle and to
test for colorfastness before using on colored fabrics! Danine in
For More Rust Removal Ideas go to
Q. I have well water. Is there anyway that I can detect how much well water
I have? Also can someone recommend a good reading source so that I may look
up any other questions and/or concerns that I may have on this topic?
Answers to the Well Water questions can be found at
Q. Is having a garbage disposal helpful in reducing your garbage? I now
pay for sanitation and would love to know if there is a way to reduce waste.
I have a septic system and a garbage disposal. I do not abuse the disposal
by throwing large amounts in it. It is perfect for the leftover cereal in
the bowl, and other small amounts left on the plates. My rule of thumb has
been this: If the garbage won’t smell, throw it in the trash, i.e., bread
items, pasta without meat, pizza. These items dry up and create no problem
in the trash. If it is going to smell, i.e., bones, fat, skin, meat, etc..,
recycle a plastic bread bag by putting the garbage in it and keep in the
freezer until trash day. When you put out your trash for pickup, throw all
your frozen trash out that day. The birds and other critters can’t smell it
and won’t destroy your trash bags trying to get it. When you clean out your
refrigerator to rid it from spoiled leftovers, don’t throw them in the
disposal, put them in the freezer. – Linda
To the reader who sent the question about the garbage disposal, or how to
reduce waste: Do you have any type of garden? Even a wee little one
(container gardening?) will benefit from compost. Begin a compost heap,
using your kitchen “leavings” (NO animal products except eggs shells,
though). With it place leaves, yours and/or other folks’ grass clippings
(stay away from chemically treated lawn clippings though when planning to
use your compost in a garden), even your parakeet droppings, hamster litter,
etc. You get the idea. (NO dog or cat stuff though!) If you have no
livestock (chickens, rabbits, etc.) you may need to get a compost activator.
Not to overlook all possibilities…. do you live in the country and have
chickens, perchance? We feed our “garbage” (NO animal products, though) to
our chickens. This includes “old” stuff that occasionally surfaces in the
fridge (no moldy stuff, though)! – Bob and Teddy
Pleae look in the next issue if your question wasn’t answered. Thanks for all your contributions.
LEARN MORE ABOUT HOW MY BODY WORKS
Old-fashioned remedies have worked for a very
long time. Regain that important knowledge
about your body and natural remedies. Learn
more with free online classes at The Herbs Place.
Find a Natural Health Solution!
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