Money v. goods

I ran out of dish detergent yesterday night an thought “No big deal, I’ll trot downstairs and grab another jug of the stuff.” To my chagrin, that was the last one. Bad survivalist! Sure, the end of the world is not going to be made worse by a lack of dish soap, but it’s the principle of the thing: shoulda had it, didnt.

So, that got me to thinking that January (or, really, late December) should be my evaluation period for purchasing “a years supply” for the coming year. I’ve made a list of a few things I’m just going to go ‘heavy’ on and see if they do indeed last me the year. This should make for some interesting looks from the guys running the registers at CostCo when I pick up a dozen drums of detergent.

And as I said, the end of the world experience will not be greatly affected by a lack of dish soap. But a ‘localized’ end of the world..such as a job loss or similar, ‘personal’, disaster will be somewhat eased if I can reduce the number of things I have to buy until I”m back on my feet.

Think about it. Pretend you lost your job and its going to take you three months to get another paycheck coming into the household. Every dollar is going to count, right? So the less money you’re spending on toilet paper, paper towels, soap, food, clothes, etc, is more money you have to stretch for other necessities. This is why I try to keep as much long-term-storage-friendly consumables on hand as possible.

I have the storage space (mostly) to go deep on stuff like that, and even if the world doesn’t come to an end I’m still ahead, inflationwise. There is an opportunity cost, I suppose, to tying up that money when it could be doing other things. That brings up a much bigger quandary: cash or goods?

Let’s say I spend $100 on toilet paper to store for the year. Assuming inflation runs around 4%, that means it would take $104 to buy that same toilet paper at the end of the year. By buying it upfront, I ‘made’ 4% on my money. But what if I simply took the $100 and put it in an envelope in my desk? At the end of the year it only buys me $96 worth of toilet paper. BUT…it can also buy me a host of other goods, whereas if I had spent the $100 on TP all I’d have is TP. In other words, $100 worth of TP vs. $100 cash. $100 of TP is just TP…but $100 cash can become $100 of TP, food, fuel, ammo, shoes, etc. So, it might make more sense to store the cash, rather than the TP.

As I said, my buying power is reduced by inflation…Assume TP was $1 a roll, just for round numbers. $100 gets me 100 rolls in January, but in December it gets me 96. But if I invested that $100 at something that made more than 4%, that would mean I could buy at least 100 rolls in December. The stock market, yearly, returns upwards of 10% on average, right? So, in theory, I park $100 in January and in December I buy 110 rolls of TP.

But…risk, scarcity, and self-discipline come into play. The investments may go down and my $100 may get cut to $75. So..75 rolls of TP in December. Or scarcity may come into play..the TP crop could get TP weevils and the price shoots up. Now my $100 can only buy 50 rolls in December as the price doubled. Or inflation may go past 4%. And, finally, self-discipline – can I stare at $100 sitting on my desk for a year and not touch it? Mmmm…

And often the bird in the hand is worth the two in the bush, y’know?

So…goods. This isn’t to say I don’t keep money stored away. I just keep it where I can’t see it or get to it without a conscious, purposeful effort.

All this to say that next payday I’m going to pick one item off my list of ‘Go Heavy’ and stock up for the year. At the end of the year I’ll review if the amount purchased was indeed a years supply. That’ll give me a good metric of what a years supply constitutes around this house.

This mental exercise in frugality, preparedness, and cost/benefit has been brought to you buy writers block, an empty soap container, and un upcoming sense of dread.

18 thoughts on “Money v. goods

  1. I think some of this comes down to your feelings about change. If you’re someone that puts a high value on today being just like yesterday and tomorrow being just like today, you probably should go deep on “stuff.”

    For me if the world goes sky-ways-and-crooked I want to have options and the ability to roll with it and to ease into things. But, I see change as constant and I’m constantly changing. I tend not to go super deep on “stuff.”

  2. Deodorant, toothpaste, toothbrushes, bar soap, razors and shaving cream are annual buys. The rest grows as needed and or opportunistically through the year.

  3. Your math here is good- I take a similar approach. When you observe the price of your staples increasing every year- it kinda makes sense to buy a years supply NOW. Coffee, ammo, TP- you name it. Helps to be liquid with cash also.

  4. make your own! arm and hammer super washing soda, borax detergent booster, fels naptha bar soap and a 5 gal bucket with a gamma seal lid. all for about 35 bucks you can make 25 gallons of laundry soap. reuse the bucket and lid so it is a one time expense. grate bar soap into a pot with water, bring to simmer and stir. turn off heat let it cool a bit while mixing 1 cup each arm and hammer and borax booster. fill the 5 gallon bucket 3/4 cool water, add the cooling soap mixture, stir then let sit 24 hours. stir before use. you can store products in less space and less cost. been doing this for 5 years.

    • That doesn’t work well with hard water – it gets weird & hard to rinse. I use a fairly cheap liquid laundry detergent & use just half of the recommended amount. Before I put the clothes in the machine I put in a scoop of cheap baking soda. Then when it hits the rinse cycle, I add a cup of white vinegar. Very good results so far, no more strange odors in the washing machine or on the clothes. I also don’t need any softener in either the wash or the dryer.

      I don’t stock up on the laundry detergent because a jug lasts me a year or more. I do stock up on the baking soda & vinegar. Also toothpaste, toothbrushes, dish soap, wash cloths (very cheap at Walmart), and other things like that. I didn’t use to stock up on canning lids, but I did accidentally. I used 3 year old lids without a single failure.

  5. Hey Commander, the dish soap thing… I just pulled a ~3/4 gallon bottle of Dawn off the shelf and plopped it on the counter. The heat welded seam split. Detergent slow leaks thru the tiny split… the bottle is at least a year, maybe two old, kept in a dark place, but subject to large temperature swings.

    Don’t go TOO deep, the packaging might not be up to it.

    Ditto on the toothbrushes. If they have the soft plastic overmold, it will go sticky with time.

    Soft soles on some shoes will just fall apart after about 5 years, whether used or not. This unfortunate happening has me watching videos of how leather shoes and boots are remade, and looking for all leather boots with vibram soles.

    Other than those things though, and the usual food items, I’m with you. Go deep on the stuff you use.

    n

    (and wrt making your own soap, you the previous comment was really about changing the form of existing soap. Real soap making involves alkali and fats. Either form of making is way to time intensive for me. Soap is cheap.)

    • The hand made laundry and dishwasher soap is due to regulations that took away the good stuff that made them effective.

      Regarding athletic shoes with foam construction, it degrades over time, so they go bad in just a few years. Really annoying to take NOS shoes out of the box and have the soles disintegrate almost as soon as you strap them on. I’ve had this happen a couple times with the “Swoosh” brand. They look perfect until you try wearing them. All those high dollar collectibles? Leave them in the box, for display only.

      • I’ve had the sole thing happen on well made Terra work boots, Ecco dress shoes, and my wife’s Italian leather hikers. They looked fine, but upon wearing, they came apart in a crumbly mess.

        I’ve had various household items and electronic gear that had a thin ‘soft touch’ over-mold or coating get sticky with time. If it’s good gear, the sticky can be removed with different solvents- alcohol being a good starting point. My Grecom scanner was probably the most expensive thing I’ve stripped clean so far, but a photographic slide scanner is a close second.

        The soft cruise control buttons on my steering wheel got sticky and crumbled after about 12 years. The NOS replacements I got on ebay are starting to worry me too.

        It sucks when otherwise fully functional items literally turn to goo.

        n

  6. BTW, don’t believe the .gov figures on inflation. It runs near 10% now, when it is calculated with real numbers. Unfortunately, it is still looking at products that are mostly lower quality than previous years. Quality has taken a major dump since Obama began screwing things up as only a dem can do. ’bout 10 years worth, by now. Companies worked hard to keep prices from changing at first, which is why quality took a hit. They can’t fiddle with that much anymore, so now prices have to change.

  7. “….I’m going to pick one item off my list of ‘Go Heavy’ and stock up for the year.

    One year is not enough. For those items which are “inconvenient’ to substitute for, I aim for regular and routine procurement of 120% of monthly use, more when I find it on sale, even more when a super deal presents itself. Having a larger-than-one-year stash of item X doesn’t mean when SHTF you’re all set for N years, it just means the pressure to find replacement for consumed materiel is reduced. Eventually, everything gets used down to zero if not replenished.

    And, BTW, to your 4% inflation figure you need to add in multipliers for the “grocery shrink ray” effect (reduced package size) and “manufacturer cost reduction through quality reduction.” Paying 4% more at year-end for TP that suddenly became single-ply instead of 2-ply is greater than a 4% hit. Quality goods now at today’s cost beats the heck out of crappier stuff at higher prices tomorrow.

  8. Hold your money until an item on your list goes on sale, then go deep. Seems like your plan on groceries from previous posts. Forget talking about 4% (or 10%) inflation, when it’s a buy 1, get 1 deal, you just doubled your money, or halved your expense. Why turn $100 of cash into $100 of TP? Not even considering coupons (which are annoying) you can easily turn $100 of cash into $100 of TP and $50 cash if you catch a good sale.

    • My strategy too. Maximize your cash. Buy when the prices are good and the opportunity presents itself. Paper money “value” is constantly being eroded by overt and hidden inflation. Turning a good chunk of your cash into tangible goods of all types only makes sense and is the better equivalent of “money in the bank” when the unexpected strikes. Having said that, it’s also a VERY good idea to keep between 6 and 12 months of living expenses on hand. Like it or not, paper money is still the medium of exchange for the realm…

      Best regards.

      • Most of these sales are cyclic(either 8/16 week grocery cycle,semi/annual) with some planning vast savings are possible. Don’t forget to be frugal,dish and germicidal hand soap are concentrated-dilute 50% and they are ready to use(squirt on hands/dishes and get clean without adding water).
        Start planning for the ongoing “Retailpocolypse” many stores aren’t going to make it and will soon be liqidating inventory(KMart just closed near me and bargains to be had,including possible barter goods)

  9. Toilet paper – not only does the price go up, the size goes down. They all brag about “sheets” but I have noticed the rolls are narrower now. So you may make more than 4% in real cost inflation. But you take the risk. If a water pipe breaks and soaks the rolls of TP, you just have a big pile of goo.

    It happened to me in a bathroom once – damn water pipe in the ceiling split along a seam. Who knew copper pipes have seams? Apparently they are folded up and welded. If a seam is welded a little too thin, in time it splits.

    • I would imagine its not terribly difficult to not put toilet paper under water pipes.

      • Who knew the water pipe was there? It was in a ceiling. It didn’t take long to come throught the wallboard and paint and into the bathroom. Still – not a lot was lost in this incident. The main is that any goods you stock up on are subject to loss.

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