In this episode, Emily features contributions from the PhD community and from ChatGPT around the topic of frugal tips. Grad students in particular are typically open to exercising frugality to decrease their expenses. Emily talks through her framework on how to decide which area of spending to target first with frugality. She then demonstrates how to use ChatGPT to find as many frugal tips as you could ever want. The episode ends with the frugal tips submitted by grad students and PhDs, which are often more tailored and actionable than the generic ones you can find online.
Links mentioned in the Episode
- Download the PF for PhDs PhD Spending Tracker
- Chat GPT
- Tax Workshops and Seminars
- PF for PhDs S10E8: This Grad Student Eliminated Her Housing Expense to Pay Off Her Student Loans
- PF for PhDs S8E4: Turn Your Largest Liability into Your Largest Asset with House Hacking
- PF for PhDs Subscribe to Mailing List
- PF for PhDs Podcast Hub
00:05 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.
00:34 Emily: This is Season 16, Episode 6, and today my guest is ChatGPT and all of you! Our topic is frugal tips. Grad students in particular are typically open to exercising frugality to decrease their expenses. I talk through my framework on how to decide which area of spending to target first with frugality. I then demonstrate how to use ChatGPT to find as many frugal tips as you could ever want. The episode ends with the frugal tips submitted by grad students and PhDs, which are often more tailored and actionable than the generic ones you can find online. You may have heard that Mint, the popular budgeting app, is half being shut down and half being moved under the Credit Karma umbrella. Longtime Mint users are freaking out and looking for alternatives. As it happens, a few weeks ago I finally cleaned up and made available the Excel spreadsheet I use for tracking to fulfill a request made in advance of a webinar. If you would like to try out manual tracking, please take my spreadsheet and use it as is or build it out however you like. It includes a couple of budgeting principles that I like to follow and teach to grad students. There’s a companion video available explaining those principles. If you’d like to grab the spreadsheet, it’s totally free, just register through PFforPhDs.com/tracker/. You can find the show notes for this episode at PFforPhDs.com/s16e6/. Without further ado, here’s our episode on frugal tips.
02:20 Emily: PhD students are pretty frugal, right? I mean, not everyone in every area of life, but a degree of frugality is necessary if you have any hope of staying in the black throughout your PhD. Now, that frugality may come naturally or it may be something you have to white-knuckle through, but it will happen. I did my PhD during the Great Recession, and frugality was a very popular topic in the personal finance blogosphere, of which I was a part. I remember reading blog post compilations of frugal tips and thinking that I already practiced the great majority of them, and some of my peers did, too. After some time of honing my own frugality, it became a bit of a struggle for me to find new-to-me frugal tips that I was willing to try out. Everyone has their own limits, of course. That’s one of the tricky things about searching for frugal tips: You have to wade through a bunch of tips that aren’t relevant for your life or that go beyond your comfort zone to find one or two that could really work for you. This episode will help you with that process of finding frugal tips that might actually work for you. First, I will share my frugality framework to help you prioritize which budget categories are the best to target with frugal tips. Second, I’ll tell you how to use two invaluable resources to come up with relevant frugal tips, ChatGPT and your peers, and include example tips from both sources.
03:41 Emily: Some frugal tips are poised to have a greater effect on your budget than others, especially if they take significant time and/or energy. The juice is not worth the squeeze, so to speak. The Frugality Framework that I’m about to share with you is one that I teach during some of my personal finance seminars for universities. When people decide that they would like to reduce their expenses, it’s often a bit of a panic response. They realize they’re over budget or racking up debt or are about to experience a decrease in income or an increase in another expense. For example, after 3.5 years of forbearance on federal student loans, in October they went back into repayment, so borrowers suddenly had a new expense of tens, hundreds, or thousands of dollars per month that they hadn’t had to pay in quite a long time, if ever. The common response to this is to reduce or eliminate the types of expenses that will have an immediate effect on your overall spending and that give the least resistance. Generally speaking, the first target expenses are variable and discretionary. Variable expenses are ones where your spending correlates with your consumption level, and discretionary expenses are optional, not required to keep you alive and productive. Variable and discretionary budget categories include eating and drinking outside of your home, entertainment, appearance-related personal care, some types of shopping, and much more. You might even be able to immediately reduce spending in budget categories that are commonly viewed as necessary but that have a discretionary fraction as well, such as groceries and gas.
05:16 Emily: This can be very effective in the immediate term to alleviate a cash crunch, but it is likely to only be sustainable for a short period of time. Discretionary expenses are the ones that provide some flavor and enjoyment to our day, and life is likely to feel bleaker without them. Because these expenses are variable, it takes willpower to sustain cuts in these areas, and that willpower will eventually deplete. As easy as it is to reduce or eliminate spending in these areas, it’s just as easy to turn the spending back on once that happens. I don’t want to convey that it’s impossible to sustain cuts to variable and discretionary expenses or that your life won’t be worth living if you do. But to make sustainable, long-term changes to these areas, you will have to make your lower-spending lifestyle a habit and really learn to love your frugal substitutes. That takes time, and if your willpower runs out before your habits take hold, your spending can easily bounce back. There is a time and place for frugality in your discretionary and variable expenses. But if you know that your frugality needs to be a long-term practice, such as the length of your PhD, I suggest a different approach.
06:30 Emily: Think of your expenses as falling into four quadrants, arranged in a square. The two columns are for your variable and fixed expenses. The two rows are for your large and small expenses, or you could picture a continuum here if you like. The expenses that we just mentioned mostly fall into the small and variable quadrant, with some budget categories like groceries probably falling into the large and variable quadrant. The quadrant that I believe you should focus your frugality efforts on first is the fixed and large quadrant. Your fixed and large budget categories almost certainly include your rent or mortgage, your car payment and car insurance if you own a car, and childcare if you have a young child. The reason that I suggest putting your frugalizing energy into this category first is that reductions in these expenses are the 80:20 solution to reducing your spending without depleting your time and energy reserves. By definition, if you reduce a fixed expense, that lower spending level is locked in for the term of your contract and probably indefinitely into the future. Once the change is made, you don’t have to spend any more time or energy to maintain the reduction. Furthermore, because these are large expenses, they have the greatest potential to affect your overall spending level. Even a 10% reduction in your rent or mortgage translates to a savings of dozens or perhaps more than one hundred dollars each month, whereas you would have to dramatically reduce or eliminate entirely a small expense to have the same effect.
08:07 Emily: You already know why almost no one starts with this category though, right? It’s because it’s intimidating and difficult to reduce expenses of the type that I mentioned. For housing, it would likely involve moving, which takes time, research, expense, and a whole lot of effort. It’s also not something that you can do immediately, but requires an acceptance of a long-term commitment to frugal living. Same thing goes for selling or trading your car or finding a different childcare arrangement. These are incredibly challenging tasks to undertake, and they lack the immediate gratification that denying yourself a restaurant meal can provide. But the effort that accompanies changing one of these expenses, I believe, is worth it, if you can get a large enough expense reduction. I went through this personally in graduate school. I moved four times during my PhD, and in three of those moves I reduced my rent expense without sacrificing square footage or proximity to my university. When I finished graduate school, I looked back at the most effective strategies that I employed to increase my cash flow, and those moves topped the list. If you’re interested, I detailed the whole list in Season 1 Episode 1 of this podcast. Frankly, I think it’s highly atypical to make an optimal housing decision in your first year of your PhD program, doubly so if you are moving from out of the area, so at least one move during grad school is warranted once you get to know the housing market and area as a local.
09:37 Emily: Once you’ve investigated and addressed your large, fixed expenses to the greatest extent possible, it’s time to move on to the other quadrants, which should be far less daunting. The second quadrant to focus on is your small, fixed expenses, which can include your internet service provider, your cell service provider, any ongoing subscriptions, and insurance policies. Again, we are not focusing only on discretionary expenses here, but also re-evaluating what are usually considered necessary expenses. Yes, it is necessary to have a cell phone, and probably a smartphone with a data plan at that. But there are likely many plans available that will fulfill your needs, and you have a choice about whether you want to pay for discretionary elements such as a large amount of data. Consider each of your small, fixed expenses through this lens, and keep in mind that annual re-evaluation and frequent switching of providers is typically the best strategy to keep expenses low. The cost of this once-per-year expenditure of time and effort to shop around is well worth it when you find a way to lock in a lower spend for one of these fixed expenses as no ongoing willpower is needed.
10:50 Emily: The third quadrant to work on is your large, variable expenses. Groceries almost certainly fall into this quadrant, and depending on your lifestyle, other potential budget categories are travel, gas, shopping, hobbies, entertainment, and appearance-related personal care. Because these expenses are larger, there is room for a significant reduction in spending, but being variable, they are beset by some of the same issues as those of the small, variable quadrant. You will need to start with experimentation into how to reduce these expenses, but the experimentation must shift into habit formation around any tips you want to use long-term, or else they will not feel sustainable. For example, if you want to reduce your grocery spending through purchasing and eating less meat and dairy, the experimental phase might involve trying out new recipes, with the habit coming when a few of them graduate into your regular meal preparation rotation. Personally, my family has implemented a “decide once,” to borrow one of the principles of the Lazy Genius, of always purchasing gas when we shop at Costco because it is reliably less expensive than the alternatives. We have also been experimenting with a decide once of always flying Southwest when available as it is a budget airline and we are plugged into its companion pass and points system.
12:12 Emily: Finally, we can return to considering the fourth and final quadrant, your small, variable expenses. Perhaps by the time you have worked through all three other quadrants, you will not feel the need to make any further budget reductions. If you would like to reduce your spending further, at least you will have practiced determining for your life what is necessary and what is discretionary and what you value and the frugal habit formation process. You’ll be better positioned to tackle this category. Perhaps you could even pair some immediate cuts to your small, variable expenses to some cuts to your fixed expenses that are in the works so that you can increase your spending once again when your fixed expenses drop. You have to know yourself to figure out what will work for you when it comes to using willpower to sustain reductions in expenses and how you can transition it into habits. For example, Gretchen Rubin has a framework classifying people into abstainers vs. moderators. Budgeting variable expenses is usually an exercise in moderation as you say yes to certain expenses within limits. If you’re an abstainer like me, it might be easier to tell yourself that you simply do not spend any money in certain categories while eliminating or raising the limits on other categories. Now that I’ve shared with you my recommended theoretical approach to frugalizing your budget, I’d like to point you to some resources for actually finding frugal tips to experiment with in your budget categories of interest.
Resources on Frugal Tips
13:43 Emily: From my blogging days, I know that the internet is littered with lists of frugal tips, and there are books and other resources that you can tap as well. But since I want you to target just one budget category at a time, I’m going to point you to two resources where you can really target the type of information that you’re seeking: ChatGPT and your peers.
14:05 Emily: Seeking frugal tips is an accessible and easy way to use ChatGPT; it’s not at all sophisticated. I used the free version of ChatGPT that is available at chat.openai.com for my queries. I like ChatGPT for this over a search engine because you can be quite specific with your query and iterate it as necessary. I’m going to give you one example of seeking frugal tips for a fixed cost and one for a variable cost. Let’s start with exploring frugal tips to reduce the cost of your internet service, a fixed cost. My first request was “Please list 10 ways to reduce the cost of my internet service.” This is what ChatGPT returned:
“Reducing the cost of your internet service can help you save money. Here are ten ways to do just that:
- Shop Around for Providers: Compare different internet service providers in your area to find the most cost-effective plan. Some areas have multiple providers, each offering different pricing and packages.
- Bundle Services: Many providers offer discounts when you bundle internet with other services like cable TV or phone. Consider bundling if you need these services.
- Negotiate with Your Current Provider: Contact your current internet service provider and ask if they can offer you a better deal. They may have promotions or discounts available, especially if you’ve been a loyal customer.
- Downgrade Your Plan: If you’re not using the full capacity of your current plan, consider downgrading to a lower-speed tier. You can save money by paying for only what you need.
- Cut Out Unnecessary Features: Some plans come with extras like unlimited data, premium channels, or additional services you might not need. Trim these to lower your monthly bill.
- Use Wi-Fi Instead of Cellular Data: When at home, connect your mobile devices to your Wi-Fi network to avoid using expensive cellular data.
- Monitor Your Data Usage: Some providers charge extra for exceeding data caps. Be mindful of your usage to avoid these charges.
- Buy Your Modem and Router: Many providers charge a monthly rental fee for their equipment. Consider purchasing your own modem and router to save in the long run.
- Look for Promotions and Deals: Keep an eye out for special promotions, discounts, or introductory rates offered by internet service providers. These can provide significant savings, especially for new customers.
- Consider Alternative Technologies: Depending on your location, you might have access to alternative internet technologies like fixed wireless, satellite, or DSL. These may offer more cost-effective options than traditional cable or fiber.
Remember to check the terms and conditions of any changes you make to your internet service, as well as any potential termination fees or contract requirements. Additionally, the best approach to cost reduction may vary depending on your location and the specific providers available in your area.”
17:09 Emily: I like this list pretty well. It includes all the standard suggestions that I would have thought of or eventually found. I was curious if we could get a little more creative, though, so I iterated my next request as “Please list 20 ways to reduce the cost of my internet service.” ChatGPT added ten more ideas. I won’t repeat all of them as most were redundant, but one that I thought was out-of-the-box was to “Take Advantage of Government Programs: Check if you qualify for government assistance programs that provide discounted internet service to low-income households.” One suggestion I didn’t see on this list but that I would like to add, in case you are looking for ways to reduce your internet bill, is to ask your internet service provider what types of discounts they offer so you can make sure that you’re enrolled in all the applicable ones. So if you really were looking for ways to reduce this fixed cost, you could start with the suggestions to shop around providers, including considering alternative technologies, and then either switch or negotiate with your current provider, and make sure that the plan you have fits your purposes well. I thought ChatGPT might be able to help a bit further with the negotiation suggestion, so I asked it “What should I say in a negotiation with my internet service provider?” That resulted in a list of 15 suggestions for how to handle such a negotiation. After seeing that list, I decided a sample script would be more helpful, so I asked “Would you please write a sample script of a negotiation between a customer and an internet service provider?” ChatGPT then created a sample script that started out as
“Customer (C): Good morning. I’m calling because I’ve been reviewing my monthly expenses, and I’m finding that my internet bill is becoming a bit too high for my budget. I wanted to discuss some options for reducing the cost.
Internet Service Provider (ISP): Good morning, I understand your concern. I’d be happy to help you with that. May I have your account number or name, please?
C: Sure, my account number is [Your Account Number] or my name is [Your Name].
ISP: Thank you for that. I see your account. Can you please tell me specifically what you’re looking to change or reduce in your service?
C: Well, I’ve noticed that there are some new promotions from your company that offer lower prices for similar plans. I’d like to see if I can get a lower monthly rate on my current plan.
ISP: I see. I can certainly check if there are any promotions available for your account. Before I do that, can I ask how long you’ve been a customer with us?
C: I’ve been a customer for [X] years, and I’ve generally been satisfied with the service.
ISP: Thank you for your loyalty. Let me check our current promotions for you.”
The script continues on with the customer and customer service agent exploring various options. It ends this way, which I thought was interesting:
“C: Thank you for the information. Let me think about it for a moment. Can I also request that you send me an email confirmation of the new promotion and bundle details we discussed?
ISP: Certainly, I’ll send that confirmation right away.
C: Great, thank you for your assistance. I’ll take some time to think about the bundle offer and the new promotion, and I’ll get back to you with my decision.
ISP: You’re welcome. Feel free to call us anytime if you have any questions or if you decide to make any changes. Thank you for choosing our service.
C: Thank you for your help, and have a great day.”
20:32 Emily: I liked seeing this sample script as it made the whole process seem much more approachable. Our second example is in how to reduce the cost of groceries, a variable cost. The field of possibilities for reducing spending on groceries is just about infinite, so I’m going to use ChatGPT to follow one type of suggestion until we get some really concrete ideas. My first prompt is “Please list 10 frugal tips to reduce the amount of money I spend on groceries.” This is what ChatGPT returned:
“Certainly! Here are 10 frugal tips to help you reduce your grocery expenses:
- Create a Budget: Start by setting a budget for your grocery spending. Having a clear budget will help you stay on track and avoid overspending.
- Meal Planning: Plan your meals for the week in advance. This allows you to make a shopping list with only the items you need, reducing impulsive purchases.
- Use Coupons and Discounts: Keep an eye out for coupons, discounts, and special offers from your local grocery stores. Many stores offer loyalty programs that can provide significant savings.
- Buy in Bulk: Purchase non-perishable items in bulk when they are on sale. This is especially useful for items like pasta, rice, canned goods, and frozen foods.
- Shop Seasonal Produce: Fruits and vegetables that are in season are often cheaper and fresher. Take advantage of seasonal produce to save on your grocery bill.
- Avoid Convenience Foods: Pre-packaged and convenience foods tend to be more expensive. Buy whole ingredients and prepare meals from scratch whenever possible.
- Compare Prices: Pay attention to unit prices (price per ounce, pound, etc.) to determine the best value. Sometimes buying larger quantities is more cost-effective, but not always.
- Reduce Meat Consumption: Meat can be one of the more expensive items in your cart. Consider incorporating more plant-based meals into your diet to save money.
- Use Leftovers: Don’t waste food. Use leftovers creatively to make new meals, reducing the need for additional ingredients.
- Store Brands: Often, store-brand or generic products are just as good as name brands but come at a lower cost. Give them a try to see where you can save.
Remember, the key to saving money on groceries is to be mindful of your spending and make intentional choices when shopping. With a little planning and effort, you can significantly reduce your grocery expenses.”
23:08 Emily: These tips are all great but very high-level, and I don’t yet know exactly how I would implement them. Several of the tips are getting at changing my diet to incorporate less costly foods, so I’m curious which foods exactly ChatGPT would suggest that I buy. My next prompt is “What are 10 low-cost but filling foods I can buy in a grocery store?” This is what ChatGPT returned:
“You can find many low-cost but filling foods at the grocery store. These items are not only budget-friendly but can also provide you with satisfying meals. Here are 10 such options:
- Oatmeal: A versatile and filling breakfast option that’s high in fiber. You can add fruits, nuts, or honey for extra flavor.
- Rice and Beans: Both rice and beans are inexpensive staples that, when combined, create a complete protein source. They are versatile and can be used in various dishes.
- Pasta: Pasta is an affordable and filling carbohydrate. Pair it with a simple tomato sauce, vegetables, or beans for a hearty meal.
- Eggs: Eggs are a great source of protein and can be used in a variety of dishes, from omelets to frittatas.
- Canned Tuna or Salmon: These canned fish options are not only low-cost but also high in protein. You can make sandwiches, salads, or pasta dishes with them.
- Frozen Vegetables: Frozen vegetables are often more affordable than fresh ones and have a long shelf life. They can be used in soups, stir-fries, and as side dishes.
- Potatoes: Potatoes are a cheap source of carbohydrates and can be prepared in numerous ways, from baked potatoes to mashed potatoes.
- Peanut Butter: Peanut butter is an inexpensive source of healthy fats and protein. Spread it on whole-grain bread or use it as a dip for fruits and veggies.
- Canned Soup: Canned soups, especially when on sale, can be a cost-effective way to have a quick and filling meal.
- Cabbage: Cabbage is a low-cost vegetable that can be used in salads, coleslaw, stir-fries, and soups. It’s a great source of vitamins and fiber.
Remember to balance your diet with a variety of these foods to ensure you’re getting a range of nutrients. These options can serve as the foundation for many nutritious and filling meals without breaking the bank.”
25:34 Emily: That’s a great list! Now I know a few items to add to my grocery list to displace some others. But I don’t quite yet know how I would use these grocery items. I asked ChatGPT: “Would you please point me to 10 recipes that incorporate the aforementioned foods?” I thought it might return links to full recipes, but instead it lists simple recipes right in the response.
“Certainly! Here are 10 recipes that incorporate the low-cost, filling foods mentioned earlier:
- Oatmeal with Banana and Peanut Butter:
- Cook rolled oats with water or milk.
- Top with sliced bananas and a dollop of peanut butter for a satisfying breakfast.
- Rice and Beans Burrito:
- Cook rice and black beans.
- Wrap them in a tortilla with salsa, cheese, and any other desired toppings.
- Pasta Primavera:
- Cook pasta and mix it with sautéed frozen vegetables, olive oil, garlic, and a sprinkle of Parmesan cheese.
- Scrambled Eggs with Veggies:
- Whisk eggs and cook them with sautéed bell peppers, onions, and spinach. Season with salt and pepper.
- Tuna Salad Sandwich:
- Mix canned tuna with mayonnaise or Greek yogurt and add chopped celery and pickles. Spread it on whole-grain bread with lettuce and tomato.
- Baked Potato Bar:
- Bake potatoes and set up a toppings bar with options like sour cream, cheddar cheese, chives, and bacon bits.
- Pasta with Canned Tomato Sauce:
- Cook pasta and toss it in canned tomato sauce with garlic, herbs, and a drizzle of olive oil.
- Stir-Fried Frozen Vegetable Medley:
- Sauté a mix of frozen vegetables in a hot pan with garlic and ginger. Add soy sauce and serve over rice or noodles.
- Peanut Butter and Banana Sandwich:
- Spread peanut butter on whole-grain bread and add sliced bananas for a quick and nutritious lunch.
- Cabbage and Sausage Stir-Fry:
- Sauté sliced cabbage with sliced sausage in a pan. Season with salt, pepper, and your choice of spices.
These recipes are simple, budget-friendly, and make good use of the low-cost, filling foods we discussed earlier. You can customize them to suit your taste and dietary preferences.”
27:48 Emily: I’m quite happy with this list! I could pick one or two of these new recipes to incorporate into my meal plan and grocery list. Let’s take the final step with ChatGPT, which is to create a meal plan. I asked, “Would you please create a meal plan of five lunches I can bring to work from the aforementioned recipes and/or low-cost foods?” This is what ChatGPT returned:
“Of course! Here’s a meal plan for five budget-friendly work lunches using the low-cost foods and recipes mentioned earlier:
Day 1: Pasta Primavera
- Lunch: Pasta Primavera (pasta with sautéed frozen vegetables, olive oil, garlic, and Parmesan cheese).
- Side: A piece of fruit (e.g., an apple or an orange).
Day 2: Rice and Beans Burrito
- Lunch: Rice and Beans Burrito (rice and black beans wrapped in a tortilla with salsa, cheese, and toppings).
- Side: Baby carrots with hummus.
Day 3: Cabbage and Sausage Stir-Fry
- Lunch: Cabbage and Sausage Stir-Fry (sautéed cabbage and sliced sausage with your choice of seasonings).
- Side: Greek yogurt with a drizzle of honey.
Day 4: Tuna Salad Sandwich
- Lunch: Tuna Salad Sandwich (canned tuna mixed with mayo or Greek yogurt, celery, and pickles, on whole-grain bread with lettuce and tomato).
- Side: A small serving of mixed berries.
Day 5: Baked Potato Bar
- Lunch: Baked Potato Bar (baked potatoes with toppings like sour cream, cheddar cheese, and chives).
- Side: A side salad with vinaigrette dressing.
These meal ideas are not only budget-friendly but also relatively easy to prepare. You can make adjustments to suit your taste preferences, and they’re designed to be portable and easy to bring to work. Don’t forget to prepare and pack them in advance to ensure a convenient and satisfying lunch experience.”
29:38 Emily: That’s where we’re going to leave this exploration of grocery-related frugal tips. I focused more on what I would do at home rather than exactly how to navigate the grocery store, but your frugal experimentation with your grocery budget is likely to go down a completely different path.
29:55 Emily: Emily here for a brief interlude! I’m hard at work behind the scenes updating my suite of tax return preparation workshops for tax year 2023. These pre-recorded educational workshops explain how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. For the 2023 tax season starting in January 2024, I’m offering four versions of this workshop, one each for US citizen/resident graduate students, postdocs, and postbacs and non-resident graduate students and postdocs. While I do sell these workshops to individuals, I prefer to license them to universities so that the end users, graduate students, postdocs, and postbacs, can access them for free. Would you please reach out to your graduate school, graduate student government, postdoc office, international house, fellowship coordinator, etc. to request that they sponsor one of my tax preparation workshops for you and your peers? I’d love to receive a warm introduction to a potential sponsor this fall so we can hit the ground running in January serving those early bird filers. You can find more information about licensing these workshops at P F f o r P h D s dot com slash tax dash workshops. Please pass that page on to the potential sponsor. Now back to our interview.
31:39 Emily: The other excellent resource for frugal tips, in my opinion, is your peers. They have the most natural insight into your financial situation and the options and resources available to you. For example, perhaps your university or the surrounding community offers certain discount programs, but they aren’t well-advertised. Your peer could alert you to this fact. This happened to me, actually. When I was in grad school, I went to the dentist for the first time in my city, and because we didn’t have dental insurance, I paid cash for my visit. I mentioned how my morning had gone to my officemate, and she told me that our health insurance actually offered a discount program. You were able to get 50% off the cash price if you provided your health insurance card to certain dental care providers. I called the office I had seen that morning, and I was very lucky that they were one of the partners and they refunded me half of what I had paid! That small exchange with my peer saved me a couple hundred dollars that morning, and a couple thousand over the course of my time in grad school. Now that’s a valuable frugal tip! The ideal peers to learn from are those who attend your same university, but I wanted to get you started with frugal tips from your peers around the country who listen to this podcast, which they have submitted over the past few weeks. I’ve organized these tips into distinct budget categories. I’ll also add in some comments of my own as we go through.
33:11 Emily: An anonymous contributor said: “Consider grad housing and an RA position as this can reduce your housing costs a lot.” This simple tip is probably more valuable than all of the others put together, honestly. Several of our past podcast interviews have discussed the value of subsidized campus housing and the possibility of reducing or eliminating your housing expense through serving as a resident advisor. I want to point you in particular to the Season 10 Episode 8 interview with Dr. Erika Moore Taylor. Erika served as a resident advisor in four out of the five years of her PhD program, completely eliminating her housing expense in those years. Now, make no mistake, being a resident advisor is a part-time job, but it’s a comparatively lucrative part-time job that is unlikely to raise any red flags within your program. Since we only received that one housing-related tip—and it was a stellar one, make no mistake—I’ll make one further suggestion. Of course, you can go to ChatGPT for specific ideas on how to reduce your housing expense. But my meta-suggestion is to get to know the housing market in your area, definitely the rental and also potentially the buying market. You’re very unlikely to make an optimal housing choice in your first year of grad school, especially if you’re new to the area. Real estate is local, after all. Be intentional about getting to know the housing market during that first year by talking with your peers about where they live, how much they pay, and whether they like it, and also searching for housing through a variety of mechanisms, not just online. Through that process, you’re likely to discover a less expensive way to fulfill your housing needs and wants. And if housing in your area is inexpensive enough, please consider purchasing a home and house hacking, which is when you purchase a home and rent out part of it to roommates. We did a whole episode on house hacking with Sam Hogan, which is Season 8 Episode 4.
35:16 Emily: Several of our contributors mentioned either living car-free or using your car less due to high gas and parking costs. They suggested taking public transit or biking instead. Ricky Gettys from Penn State added that his campus offers a bike den, and you can use their tools and expertise to maintain your bike. An anonymous contributor observed, “Many cities allow you to ride for free with your student ID.” Another anonymous contributor who has a car suggested finding free street parking near campus and walking a bit further instead of paying for parking, noting “I saved ~$3000 over the course of my PhD because I never bought a parking pass.”
35:58 Courtney B: Hi, this is Courtney Behringer, PhD student at Oregon State and my frugal tip is that used e-bikes are very plentiful right now on the market, including Facebook marketplace and Craigslist and with a little of negotiation, you could likely get one for under $300 and new ones are getting cheaper every day. I’ve avoided hundreds of dollars in parking and gas and it has only been five months with my e-bike and I actually get to my office faster.
36:26 Emily: Even if you own a car, I think it’s really smart to get to know and try out the biking and public transit routes between your home and your university. There may come a time when your car is unavailable to you, and you’ll need an alternative way of getting to campus. Who knows, you may find the alternative more pleasant than driving and parking. There are some trade-offs if you decide to live car-free, and Shaniah at Emory had a tip that straddles this transportation category with our next category of food: “If you don’t have a car, try Door Dash or Uber Eats. Consider getting a Dash Pass for discounts on large grocery purchases. The cost for delivery is way less than Ubering back and forth.”
37:07 Emily: I received a lot of food-related frugal tips, so we’re going to divide them into tips that relate to eating out of your own kitchen and those that relate to procuring food outside of your home. First, the tips related to eating out of your own kitchen. Right off the bat, we receive the simple advice from an anonymous contributor to “cook at home.” It’s virtually always less expensive to eat food that you prepare yourself vs. food that someone else prepares. So if you want to spend less on food overall, as often as possible and to the greatest extent possible, eat from your own kitchen. Another anonymous contributor put it like this: “Instead of eating out, cook your own meal whenever possible. I personally don’t do this as much as I should but I have other PhD friends who cook most of the time; it saves a lot of money for them.”
38:00 Emily: Pranav from Purdue offered several pieces of advice on the practicalities of making this strategy work, particularly when you are on campus: “1. Avoid buying coffee or snacks during the day. Keep a coffee mug, coffee, tea, granola bars, and other snacks at your desk. Carry fruits every day. 2. Cook at home and plan to carry food for most, if not all, meals on campus. If you eat chicken, marinate on weekends and use through the week in pasta, salad or sandwiches. 3. If you like salad, and a refrigerator is available at your lab for food, store salad dressing and salt/pepper there. Then you just carry a packet of salad and marinated chicken or boiled eggs, and/or fruits. 4. If you plan to stay till late night on campus, make overnight oats in the morning. This helps me avoid the urge to buy dinner, because I know I have already prepared it at home.” Anonymous from Tufts concurs, saying: “I avoid buying food or coffee out by bringing a lunch and coffee with me each day.” They then extended the advice on beverages to alcohol, saying: “I like drinking wine at the end of my day and so I buy a full box of wine at a time to receive a 15-20% discount.” When it comes to actually doing all this cooking that we’re talking about, an anonymous contributor shared: “Meal prep: One of the biggest expenses is eating out. However much you try to eat out healthy, it will be worse than when you cook. Make 4 or 5 things at once to save time, portion and keep them in identical containers so you have a sense of surprise when you open your lunch box. Eating food you cook is better than eating out on multiple fronts.”
39:41 Emily: How about frugality in procuring all the groceries you’ll need? Katie suggested visiting the food pantry on campus. Food pantries or food banks are increasingly available and increasingly utilized on university campuses.
39:55 Courtney B: Another frugal tip I have is that many universities have a basic needs center. It might not be called that, um, or some sort of food pantry. Um, and my university gives out quality groceries once a week, which always includes eggs, bread, and yogurt, but also often vegetables and fruit that last me a whole week. Um, this program aims to reduce food waste in the community and provide shame-free food to students.
40:22 Emily: An anonymous contributor suggested a subscription to an imperfect produce delivery box or a community supported agriculture (CSA) farm.
40:32 Courtney B: Courtney here with another tip. I am learning the art of gardening and preserving. There’s a veggie you use a lot. For example, spinach or tomatoes consider planting a lot in the spring and harvesting in the fall and freezing for the rest of the year. I recently did this with jalapenos and now I have jalapenos to last me a year in the freezer. Speaking about freezers, you can freeze just about any food, too much tomato paste, freeze it, garlic, ginger, freeze it, freeze bread. Food waste is expensive and as a busy PhD student, I love pulling things outta the freezer as needed.
41:04 Emily: Shaniah from Emory submitted several tips related to grocery shopping: “1. Join Grocery Store reward programs for discounts and deals. CVS, Kroger and Publix have really good promotions. 2. Shop online first (add items to your cart) then go in person. This helps you stick to your budget and pr events overspending. 3. Download the store apps. Similar to #1, this helps you scan items before adding it to your cart; some grocery stores do not update their grocery store price tags / labels.” Finally, as an in-between solution, Shaniah from Emory suggested substituting restaurant meals for a meal subscription service. Second, the tips related to procuring food outside your home. As you might expect, obtaining free food on campus was brought up several times, including by an anonymous contributor who said “FREE FOOD opportunities abound on campus – make the most out of them! (‘One of the essential skills to be a great researcher is being able to find free food.)” Katie suggested bringing food storage containers to campus so that you can easily collect this free food and save it to be eaten later. An anonymous contributor took another approach: “Look in to graduate student off-campus meal plans. At UC Berkeley, our off-campus meal plan equates to getting an all-you-can-eat lunch for $10. There aren’t many restrictions and any unused money rolls over to the next semester.” Ricky Gettys from Penn State pointed out that “kids under 6 eat free at the campus dining halls” and a few other establishments, so that would really help out a young family. We also heard that tip in the Season 16 Episode 4 interview with Dr. Ilana Horwitz regarding Stanford.
42:51 Emily: Katie and an anonymous contributor were both thinking along the same lines regarding a gym membership, pointing out that your university’s gym might be free or discounted or your health insurance might reimburse you for a gym membership. Another anonymous contributor from Tufts shared: “I use my school’s offerings such as free NYT for my news following.” I have to say, something I really miss about grad school is the abundant free or discounted on-campus resources like the ones mentioned in this section. I didn’t appreciate them enough until after I left!
43:28 Emily: Anonymous from Tufts offered a creative solution, “I try to get Amazon gift cards through side gigs (e.g., participating in user interviews or events on campus that pay) to pay for basic household/personal items so that those little costs don’t hit my budget.” Grad students often complain about being considered a student only when it suits the university vs. an employee only when it suits the university, but this anonymous contributor is trying to have the best of both worlds: “Check for (college) student discounts at businesses, these usually still apply to PhD students. Also check your university HR website for employee discounts, you might be able to use some of these too if you can be considered an employee.” Katie added: “Also look into if your university partners with community businesses, often you can get free/discounted things that way. I use my grad student id for any student discounts I can—movie theaters, admission costs, etc.” Another anonymous contributor was thinking along the same lines: “Utilize coupons/discounts/other promotions from school, local newspaper ads, etc.” Another anonymous contributor said “Pay attention to your graduate student society and university calendar as there may be free or discounted events for students on and off campus.” An anonymous contributor suggested “Finding furniture and other home goods on facebook marketplace.”
44:56 Courtney B: Another frugal tip here from Courtney Thrifting. Items enclosed is sustainable and a frugal game changer. I go about twice a month through the thrift store and set price boundaries for myself, and I recently found very nice clothes for conferences for $5 each piece. Um, pro tip go after each semester is over when students are dumping items like crazy.
45:21 Emily: And finally, another anonymous contributor noted that “Events that give away free t-shirts/clothing items are your friends.” It’s a trope, but all those free T-shirts saved me significant money in grad school!
45:37 Emily: I wasn’t necessarily expecting this, but I received several financially-related frugal tips. From an anonymous contributor: “Have a system (app, spreadsheet, etc.) where you track monthly budgets and expenditures grouped into budget categories.” Absolutely wonderful advice that is an umbrella over all the other frugal tips. Another anonymous contributor said, “Have 2 separate bank accounts. A high yield savings account and a spending account. Adjust the money you put into the spending account from each paycheck such that it is only a little bit more than your monthly budget. This keeps you disciplined about spending while you know that you are not running out of money.” I believe this person is saying to deposit your paycheck into the savings account and allocate to the spending account only what you actually want to spend that month plus a bit of wiggle room, like a more extreme version of the adage to pay yourself first. I like this strategy a lot! Pranav from Purdue suggested, “Maximize bank and credit card rewards and referrals and use a budgeting (not spend tracking) app like YNAB. YouTube is excellent for information about this. (pay on time and in full, and don’t spend money you don’t have!). First year of YNAB is free for college students.” At the time of this recording, Mint has just announced that it is partially transitioning to Credit Karma/partially shutting down at the end of 2023, so frankly this is a great time to try out another budgeting system like YNAB, which stands for You Need a Budget, or my simple spreadsheet tracker, which you can find at PFforPhDs.com/tracker/. Finally, Ricky Gettys from Penn State said, “Most Grad student stipends are NOT taxable at Penn State, meaning income is $0 on PA tax returns. That means that federal programs are almost guaranteed to apply (SNAP, Medicaid, ACP aka free internet).” I can’t verify everything in this tip, but I do know that fellowship income not reported on a Form W-2 is not considered taxable income in Pennsylvania, so if I were on fellowship in Pennsylvania I would for sure look into all the programs that Ricky listed. I hope you all enjoyed listening to this episode as much as I enjoyed creating it! If you have a frugal tip of your own to share, please visit the show notes at PFforPhDs.com/S16E6/ and add it as a comment there. I can’t wait to hear your tips and how you will use the strategies in this episode!
48:09 Emily: Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.