Simple living is one of the essential qualities needed to survive economical hard times. Simple living does not mean deprivation or voluntary suffering. In the context of Breadnomics, we will take simple living as being careful with our money, focusing on what truly matters in our lives.
We have seen many Hollywood and sports personalities earning millions of dollars during their outstanding careers, but ending up as destitute later in their lives. It is primarily due to their extravagant lifestyles and mis-investment of their incomes.
With the growth of the internet and social media platforms, we have seen the promotion of various simpler lifestyles, especially among post-boomer generations – minimalism, frugal living, slow living, or intentional living. These lifestyles are benefiting millions of people today.
If we want to see an example of what worked during hard times, we can look at the last Great Depression. During the last Great Depression between 1929 and 1940, the unemployment rate reached 25% and it touched every single working American in some way. Thousands and thousands of people lost their homes and belongings along with their livelihood. People were living in shantytowns called Hooverville in various parts of the country just to get by. But several people survived this period with good preparation and came out stronger and healthier.
Though our current country’s economic climate or personal situation may not match the Great Depression, the practices employed by our grandfather or great-grandfather generations could help us survive and grow in any hard times. If we look at what worked for them, it would point to the following simple living practices. We can adopt any of these practices based on our personal situations.
1. Reduce spending money by being self-reliant and resourceful:
It can be summarized in the following two statements,
a. Do it yourself (DIY):
During the Great Depression, the DIY principle was followed in all the areas of lives – food, water, shelter, safety, clothing, etc. Families with a small plot of land (to grow their food) and some livestock managed the hard times better than others. Meals were simpler and were made from scratch, rather than from preprocessed packages. Clothing was mostly made at home. Home-made gifts were the norm because most people could not afford to spend money on gifts.
b. Use It Up, Wear It Out, Make It Do, Or Do Without:
This depression-era motto was followed in every single household – “Use It Up, Wear It Out, Make It Do, Or Do Without”. i.e. Don’t throw away any item if it still has some use, fix whatever you can, finally try to live without it.
Clothes were passed down to the next one among the siblings. Shoe soles were fixed with cardboard or rubber tires. People wore dresses made in their homes from Pillsbury flour sacks or other bleached feed sacks. Every single item was found a use till it could not be used in any other possible way.
Take away lessons:
- Let us look at all of our non-essential spendings and see whether we can avoid the expenses by doing it ourselves or we can live without the non-essential product or service. It may not be possible to do everything by ourselves, but it is worth analyzing.
- Try to minimize the wastes by reusing items in every possible way.
2. When money has to be spent, spend it frugally on essentials only:
When people had to spend money, they spent on the most essentials that provided good value for their money.
a. Essential vs Non-Essential (or Need vs Want):
Modern marketing methods, advertisements, and cheap credits made many non-essential purchases appear as essential purchases. But it was not the case during the Great Depression. People spent on absolute essentials only. The majority of the people lived without most of our modern conveniences like running water, central heating, refrigerator, washing machine, or air conditioner.
b. Going for value:
Though coupons were introduced in 1887, coupon usage became very popular during the Great Depression. People did not want to buy products at the regular price without any sale or coupon discount. When people had to buy something, they bought items that were reused or lasted longer. Reusable kitchen towels, reusable food storage containers, and manual clothes wringer were the norms during that time. Disposable products were not in use. People did not have wallets full of credit or debit cards. Though stores were offering credits to known customers, the majority of the people bought with cash only. If they did not have cash, they did not make the purchase.
Take away lessons:
- Let us only buy what we cannot live without. Cut all the non-essential expenses.
- Take a long waiting period before making any non-essential purchases to avoid instant gratifications.
- Instead of disposable goods, go for alternate reusable items and minimize waste generation.
- Buy essential items when they are on sale or with a discount.
3. Lead a recession-proof lifestyle:
During the Roaring 1920s, many Americans took out loans for their businesses, farms, and consumption. After the stock market crash, banks defaults, and their jobs lost, paying off those debts became impossible for the borrowers. Any remaining assets were also lost to pay off the debts. There were no safety-nets like Social Security, Unemployment Insurance, or FDIC to insure bank deposits.
Even high earners like doctors and lawyers saw their income drop by as much as 40%. Families had to adapt to a frugal lifestyle. Multiple catastrophes converged at the same time on the population – Stock Market Crash, Closure of Banks, and Dust Bowl farming crisis. People moved to any place where they can get a job because situations were so desperate with no end in sight. Many people just worked in return for food or shelter or to pay off their debts.
Take away lessons:
- Let us have an emergency fund
- Minimize the debt. Don’t spend the money we don’t have. (avoid credit mentality)
- Try to lead a lifestyle that is maintainable with less than 50% of the current income.
- For each transaction involving money, try to find an alternate way that does not involve money. Try bartering.
- Develop useful skills and a community to employ those skills for a prolonged survival situation
- Try to transact with local people and enterprises and develop good relationships
4. Find content and happiness in non-material things:
During the Great Depression, many people saw their investments and savings disappearing in a short time frame. So it made them focus on what was true valuables in their lives – Family, Friends, acquaintances, and non-material experiences. People were content with getting the basic needs for their families.
Kids played with homemade toys made from used things or scrap wood or paper. Adults entertained themselves with many social events like Dance Marathon or Miniature Golf rather than with material things. People helped other struggling people with whatever little they could spare. Because they knew the pain of hunger and poverty. Small communities became closer. An animated cartoon – Three Little Pigs released in 1933 symbolized what families went through at that time, ie. families coming together to beat the hard times of the Great Depression.
Take away lessons:
- Let us find content and happiness in non-material experiences like family, relationships, mindfulness, spirituality, or service.
- Do the things we love for the benefit of others. We reap what we sow.
- Try delayed gratification to purchase or enjoy material things.
Final Thoughts:
We may be in our 20s or 30s or 60s. We are used to a certain way of living from our childhood. So it will not be easy to change our lifestyle suddenly. But we can take small steps in the right direction. Let us remember the lessons from our ancestors and incorporate them into our lives.
- Reduce spending money by being self-reliant and resourceful
- When money has to be spent, spend it frugally on essentials only
- Lead a recession-proof lifestyle
- Find content and happiness in non-material things
Thank you for reading. Please share your thoughts below.