My wife and I are both still employed, thankfully, but we’re reducing our expenses and saving more to prepare for a potential loss of income. We used to buy DVDs, CDs, and books on the weekends, but we’ve stopped doing so in favor of renting and/or checking out from the library. We’ve completely stopped buying organic foods, including meats, milk, eggs, fruits, and vegetables. Also, we buy mostly generic rather than name brand products (at the grocery store and elsewhere). We drive our smaller, more fuel-efficient car rather than our more comfortable, medium-sized car to work (our offices are close enough together for us to take one car). We try to limit eating out to once or twice a week. We don’t have cable or satellite TV, or a ground phone line. We pay off our bills and don’t carry any credit card debt. We had already agreed to not buy each other birthday presents this year due to our summer vacation to Italy, and now we’ve also agreed to not buy each other Christmas gifts. Other than all of that, we’ve just had to keep reminding ourselves to not buy stuff. I badly want to re-sod our back yard, put up a fence, build a shed, buy a new lawn mower, etc., and she’s got her own pet projects, but we know that we need to save in case the economy really goes south and one or both of us finds ourselves out of a job.
Interesting post Gao,
Which industry are you in? I am fortunate enough to be involved with a lot of financiers and banks conferences, where naturally the recession is a hot topic.
In Australia we are lucky to have a fairly strong economy following the recent bail out by PM Kevin Rudd. However the general opinion seem to be that the worst is yet to come. One CEO this week when asked by an audience member what he would pray for for Christmas said “Let it end.”
No, I can’t tell you who.
My company let two people go recently, but my feeling is that their time was up anyway and the company used recession as a good excuse.
We have always lived within our means but the cost savings you mentioned apply to us ; fruit and veg from the market instead of the supermarket, filling the car up on a Wednesday (it’s cheaper) and renting movies are all good ideas.
The only effect it’s had on me is that it’s slowed down my move from teaching high school to teaching corporate. I will do both for the foreseeable future to assure a steady income. I realize corporate training budgets will be slashed for a while, but I don’t expect parents to take their kids out of high school.
My spending habits haven’t changed much. I dropped my 18 year old Benz at the shop yesterday for a complete re-paint. I still plan to make my twice annual trips home, although I’ve had to forgo business class this next time. I will still feed my dog Science Diet.
If things get worse, like if I lose one of my 2 jobs or if my partner looses his, I’ll reassess.
Interesting change in behavior. In fact, it’s downright drastic. Not that it’s unwarranted, mind you. I’m just saying it’s drastic.
Drastic usually doesn’t stick, not for most people (think diets).
So. Now the $64 question: of the dollars you and your wife have saved this way, have you managed to tuck it all away? If so, what are you doing with it?
As for me, I haven’t changed anything yet. (fwiw, I’m in IT, and in an area and with a company that’s so far untouched by the recession.) (in fact, it’s actually prospering.) (knock on wood.)
I was in a recession before the recession started-it’s called school. But the time has taught me alot about how to make a dollar stretch a little further.
Since moving back to the States, I have become bff with my library card. When I moved I found a great second-hand store and would visit on Monday’s their 1/2 day off to find any kitchen supplies or stuff for my house. Probably will be shopping for my clothes as soon as I find work. I haven’t gotten on to the coupon kick yet, as I avoid the larger supermarkets like the plague and try to by things I use on a regular basis in bulk-toilet paper, kitchen towels, personal items.
If I eat out, I try to do it only on Sundays after church, other wise, I cook and freeze stuff, rotating it. Also, some of the stuff I learned in Taiwan, I try to integrate with shopping. Like buying certain foods in Chinatown because I know they will be sold in bulk, i.e. cheaper. I have a basic cable bundle, and only watch the free movies they offer, or watch stuff online. My biggest expense is my cellphone (and tithing) which I had to increase for school reasons. But now, I’m going to cut it back to something lower. Smoking is also another big expense, but I’m working again for the umpteen time to cut that out. Also, don’t drink, at all.
It’s going to be interesting to see how much more cutting on expense I can do once I find work.But it will also be nice to have some latitude in my shopping choices when I do.
it’s horrible, but the recession has saved my life! Because I send so much money home (parents, mortgage etc)…the fact that the exchange rate has dropped from 5.9 to 3.3 means I need to send a lot less to make all the payments.
I used to spend a lot at 7-11 here, but now I take coffee in flasks to school…you never know when the money is going to stop coming in. My dad’s boss sold his estate agency this week…and the new owners most propably wont keep my dad around. Still waiting to hear…
I would posit that the greatest impact of the recession has yet to be felt. That said, I’ve been scaling back major purchases of luxury items. However, this has more to do with my current personal situation than with the trickle down effects of the world financial crisis.
We’ve both been picking up more odd jobs and saving the money. We’re doing more penny pinching, just in case --yes. We’ve postponed purchasing a new CD player and water dispenser. We haven’t seen any movies or even rented anything recently. Why spend the money when we’ve got all these great books already on the shelves, and so many hobbies we haven’t been getting around to doing?
But the biggest area we can save in is food. When things went downhill in the economy, we were in the middle of spending tons of money on a trip to Mexico and we still have a public wedding to save for, so we took a hard look at our expenses. Eating out costs a lot, and so do many of the imported and convenience foods one takes home. I’m not going to stop using olive oil, eating salmon or drinking red wine – those are just too important for health. But I can make my own inexpensive pastas more, and make my own sandwiches to take to work for lunch. A thermos of coffee from home is healthier and cheaper than whatever drink we would have paid entirely too much for (and waited far too long for) at Starbucks. Pizza is so easy to make, and so cheap to make, even if you splurge on ingredients like fresh prawns and fresh basil from the wet market. And alcoholic drinks consumed at home are reasonably priced. Importantly, I’m shopping at the wet market more, and the supermarket less. The wet market is SOOO much cheaper!
I saw this loaf of multi-grain bread at Costco and was going to pick it up, when the NT$175 price tag stopped me. $175?! For a loaf of sandwich bread? Are you out of your bloody mind? I can get (mediocre, partially) whole-wheat bread at my corner store for 1/5 that. Or I could make my own more cheaply.
So I went home and spent less than half that to make my own gourmet bread, with imported stone-ground whole spelt, high-quality imported bread flour, oats, potato flour, olive oil, milk and dried herbs, and it’s the nicest loaf of partially whole wheat I’ve ever made.
I have been making my own ravioli for FAR, FAR less than what it costs frozen at Jason’s, and mine actually tastes better too. Of course, it’s a lot of work, but I don’t mind. It’s a kind of hobby. What spurred me to do it was the price tag on the frozen stuff at Jason’s. That might be fine for someone on a handsome expat salary, but that’s not me.
Pesto in a jar? Make your own. Takeout hummus? Make your own. Bagels? English muffins? No prob. Flour is cheap, and what I make doesn’t have any preservatives, or any unhealthy oils. I put less salt in my food, and use only olive oil. So I save money and it’s healthier too.
For me the timing is great as I planned to take a year off anyway after finishing my last big writing contract. AAnd a I am paid in US dollars I actually have about 10% more than expected; this may rise if the banks here devalue the currency more.
I was hoping to get one big contract between now and next October but that may not happen. It doesn’t really matter. I am writing another book and studying Chinese (reading) and learning the ins and outs of freelancing for papers and magazines. None of this things pay in a timely fashion so I had to be prepared for a year with little income coming in no matter what.
Next October I will start the next Taiwan LP guide and after that will be Tibet and China so I know I have a very solid and well-paying full year of work coming at the end of this hiatus. By the time I finish them it will be two years from now and the recession will be over.
As for living, yeah, I’m living like a pauper but again, I had planned on that before. Won’t give up the organic and imported foods though. But I do make my cats shit outside now.
How is the economy supposed to recover when everyone stops buying stuff? That’s exactly how things will get worse. I think people should focus on smart investments, there are a lot of opportunities too. Buy things while you can get them cheap. Support the industries who need the money most, etc.
How is the economy supposed to recover when everyone stops buying stuff? That’s exactly how things will get worse.[/quote]
True, but that’s the nature of the beast. One rationally needs to look after oneself first, and the resultant collective irrationality hurts all.
If you have enough put away to make it through a depression, then yes. If you don’t have enough to make it through a period of unemployment, then no.
we were risk-averse penny pinchers before the recession. all savings in CDs, no debt. i have tenure so i’m pretty secure even if my husband gets laid off. my brother works at a pipe factory which is closing indefinitely mid-February. i loaned him ten thousand dollars a year ago, so i’m not expecting that back anytime soon. i’m not hurting, so i don’t mind waiting. the family farm is still in existence, so it is possible my 2 brothers may start doing that more as the farm is located in an affluent area and plenty of people like to go to our farm stand and buy locally grown produce. so maybe the farm stand will eventually expand to a farm market. the farm has saved our family so many times. through the depression, the the recession of the 70s when my father lost his job and started farming full-time and we all had to work on it as kids…sometimes it reminds me of the book the good earth by pearl buck. the farm gives independence and dignity and a chance for family to work together.
Has a recession been officially declared in Taiwan? Has there been a reduction in growth over two quarters? I must have missed something.
That said-two thoughts come to mind.
- Saving money is not always the wisest move in a recession. Are the banks passing on interest rate cuts to savers? I don’t think so. Putting some money aside for a short-term change in consuming behaviour is a good idea though.
- Changes in consumption. This is an excellent thing, and one of the positives of recession. People wind their extravagances in and start to live less wastefully. Using the car less, making your own coffee etc are all habits you could adopt on a regular basis without cutting into your I’m worth it factor. The poster who has stopped eating that organic nonsense has made the biggest leap of all. Bourgois bohemians need to be taught a lesson or two, and the middle classes need to kerb their conspicuous consumption addictions.
So while you adjust to the economic slowdown in Taiwan ask yourself: Shouldn’t I being making these changes anyway?
I’m too busy working to have much time to cut back on anything. I have switched my latte fix from Starbucks to 7-eleven (sigh), and we don’t rent from Blockbuster as much as we used to. We still try to support the restaurants that advertise on Forumosa as much as we can, but that is pretty much our only luxury. We did take the step of paying for our CNY vacation in full beforehand this year, unlike years past. That’s nice, because we won’t have any extra bills to come home too when it’s over. Oh, I’ve also cut down on my (expensive) cheese consumption, and I haven’t bought whisky in ages, which means that I’m starting to slowly deplete my stock, including the expensive stuff I save for company.
A little off-topic, but when you’re a parent, you’ll start looking at the backs of boxes a little more carefully. There’s so much crap being put into fruits, vegetables, meat, and eggs, that I don’t think paying a little extra is nonsense, especially when the health and development of a baby is at stake.
I agree. And to argue that you have to look out for yourself first is like cutting off your nose to spite your face. I plan to work harder over the next few months, between 2 jobs and some private students, and largely maintain my current levels of spending and saving.
I reckon I will not change much of my habits since I have no money anyways (the ex-wifer got and gets it all). I, however, was pleasantly surprised the other day while signing a new contract when the good ol’ landlord stated that since the economy is getting bad she is dropping my rent by $2000NT.
I figure this recession is my last chance at retirement.
If somebody would just tell me WHICH FREAKIN STOCK! that would be lovely, thanks.
Technically, we’re not there yet, but the DGBAS has provisionally estimated that the economy shrank 1.02% in the 3rd quarter and forecasts that it will shrink 1.73% in this quarter. There is, indeed, little room for doubt that the economy will shrink this quarter, and the only question is how much it will shrink.
And BTW, a recession requires not just two consecutive quarters of reduced growth, but two consecutive quarters of negative growth.
As for me, having had my originally very modest “wealth” reduced by close to NT$1.5 million due to the financial maelstrom, I will have to substantially reduce my budget for fitting out and decorating my newly purchased home. Whereas I had previously planned to spend up to a couple of million on it, I can now only afford to spend an absolute maximum of one and a half million, and will try to pare it down to as close to one million as possible. It’s not going to look very good, but at least it should still be reasonably habitable.
Other than that, I’ve not made any adjustments to my expenditure, and don’t yet have any plans to do so.
Since coming to Taiwan, I have saved for a recession to hit. I had to wait 15 long fucking years. Bring it on, so that all these over blown asset prices can get with in the reach of Joe Blow.