Ylan Q. Mui
Washington Post Staff Writer
Thursday, February 26, 2009 1:00 PM
The economic downturn is forcing America's households to learn a tough lesson: how to fend for themselves.
Sales of starter sewing kits have shot up by 30 percent at Wal-Mart as families forgo the tailor. Landscaping companies have suffered a 7 percent drop in revenue over the past year. Procter and Gamble said that it has noticed more questions from customers about how to dye their hair at home to match salon coloring.
The recession has had a powerful effect on the American state of mind. A Washington Post-ABC News poll released yesterday shows Americans have grown increasingly insecure about their finances since mid-September, as fears about making mortgage payments have spread and more believe the economy is in a long-term, serious decline.
Washington Post staff writer Ylan Q. Mui was online Thursday, Feb. 26, at 1 p.m. ET to discuss the ways Americans are coping with the economic crisis.
A transcript follows.
Ylan Q. Mui: Hi everyone! Thanks so much for joining me on this chat today. I'm really glad this chat is online -- you guys don't want to see what my own nails look like. Two months without a manicure and counting!
washingtonpost.com: Home Economics of Anxious Times: Dyeing Your Hair in the Kitchen Sink (Post, Feb. 26)
Falls Church, Va.: How am I coping? I'm not doing anything expensive, like major improvements; I'm not buying new cars -- just a used one if I need it; I go to cheap restaurants and play golf in twilight hours and I'm helping my extended family as my charity instead of giving to major charities. I'm paying down on my own bills and paying off my extended family's bills and taking care of our own. It is hunkering down time and that means in everything.
Ylan Q. Mui: Sounds like you are doing a lot! Hopefully you don't lose too many golf balls in the dark.
I think lots of folks feel just like you do -- one woman I interviewed said that she used to have a groomer come to her house to clip her dog's hair. Now she does it herself in the bathtub!
Anonymous: My husband is not working and my salary has been cut. I have not seen my grandchildren in over a year and a half. It would necessitate buying a plane ticket to visit them. I would go alone to save money, but I could lose my job too. Should I forgo the visit?
Ylan Q. Mui: That's a question only you can answer for yourself, I think. Is it possible for them to come visit you? Or for you all to meet somewhere halfway for a low-budget weekend camping trip?
The economy is forcing a lot of people to make really tough choices like yours. I saw a survey recently that said the number of kids who participate in sports in school is also down because parents (and kids) are trying to save money, which is also sad to me. Uniforms are expensive!
Hyattsville, Md.: I just got an engineering doctorate recently and I still can't find a job. I'm applying for the fed jobs because I think I have a best chance of getting a job with government than with private company, now, but no response, yet. So much for the constant cry of engineer shortages in the U.S. and so much for all these years of Reaganomics and government deregulations to increase high paying jobs in America.
Ylan Q. Mui: Good luck with your search!
Washington, D.C.: I found this article very interesting, but it also frustrated me because honestly, my family lives pretty low to the ground as it is. My husband and I are both employed full-time and make good salaries, but we still find ourselves struggling financially because we have two young children in full-time childcare. So I already dye my hair myself in the sink, we bring lunch to work, don't eat out a lot, etc. etc. Our big splurge is our every-other-week cleaning service which is worth every penny with 2 little ones and a very shedd-y dog. We feel like we need to cut back, but not sure where?
Ylan Q. Mui: It's true -- I've seen several comments on my story online from families who say: What's so new? We were doing all these things for ourselves already!
But so many of us (myself included!) indulged -- or more than indulged! -- in these types of services when times were good, at least once in a while. And it fueled a huge boom for the sector for a while. I mean, they even built spas for little kids!!!
Finding more places to cut back is hard. I don't know your budget or the details of your personal situation, but one good strategy is to look at your checking account statement for the last three months to get a good sense of where all the little expenditures are coming from, not just the big ones. Then you can try to target those areas.
Marion, Ohio: Some of us oldsters who were Depression Era babies have been taught to be frugal and to save money if we have anything left after the essentials. The lessons we learned were passed down to our four children who have the same values. Now they are wondering if all their disciplined living will wind up paying for someone else's problems ... perhaps those who bought whatever and whenever they wanted. Does this seem fair?
Ylan Q. Mui: It's nothing new that the children inherit the problems their parents created. Perhaps the only satisfaction is knowing that *their* children will get to inherit the problems that they create!
Fairfax, Va.: Several years ago, when the trash company raised its rate over and over again, my husband purchased an extra large trash can. We canceled our trash service, began composting whatever we could, recycle WAY more than we used to (it's free!) and make bi-weekly trips to the dump. We use paper bags in the house for trash, then move them to a very large trash bag (that can hold several days trash) and every few weeks he takes the trash to the dump. We have found that a large bag of sand on the trash can keeps the animals out and in the summer, helps reduce any escaping smells, although loosly knotting the bag does that as well. Our trash bill has gone from about $90 per quarter (back when we cnaceled it) to about $12 a month. The compost gets worked into our garden and as I said, we're recycling way more than we were so it's better for the environment, too!
Ylan Q. Mui: Thanks for the tip!
Washington, D.C.: I understand that my share of the stimulus money will come to me via a tax cut in the form of an increased net pay on paychecks issued in early April. I've heard that one way NOT to stimulate the economy is to buy stuff. But I've NOTHING about other suggestions for stimulating the economy, which is really based on consumers buying stuff and services. What are your thoughts on this subject?
Ylan Q. Mui: These question really gets to the core of the dilemma that we're in. For years, everyone told us that we are spending too lavishly and borrowing too much money and we need to just stop it. Unfortunately, consumer spending accounts for 70 percent of GDP, so when we stop spending, the economy tanks. Yeah, it's a problem.
Some Other Newspaper has a very excellent blog called Economix that recently posted some interesting thoughts on the matter. Is there a way to spend "virtuously" --- as in, if we are going to spend, how should we spend our money to get the most economic bang for our buck? It's a very interesting concept. Here's the link: http://economix.blogs.nytimes.com/2009/02/17/if-you-got-money-its-time-to-spend-some/
Richmond, Va.: The graph accompanying this article surprised me. 30 percent of households spending as usual? I would have expected the percentage to be lower. The WSJ reported earlier that spending on food is down almost 4 percent so some people must be cutting back hard. This recession seems different from previous ones in many ways, not the least of which is the media coverage. You just can't escape the 24-hour cycle of doom and gloom which makes it very hard to consider doing anything except sitting in the dark and opening a can of beans. When I tune out for a few days, I feel much less anxious.
Ylan Q. Mui: One of the most interesting things about this downturn to me is that even folks who are not affected firsthand are still feeling economically insecure. I'm sure the media coverage contributes to that, but plenty of people also know someone who *has* been affected firsthand.
Tuning it out does help to an extent, though. At least until my 401k statement arrives in the mail! :(
Chicago Ill.: Thanks for this topic. But I've noticed that most of the measures people are talking about -- doing repairs yourself, not eating out, not buying things, etc. -- necessarily mean that somebody else will lose their job. I can save money by firing my dog walker, but now my dog walker is unemployed, too.
What kind of feedback loop are we creating? Do you have any sense as to how much our efforts to survive this recession are, ironically, prolonging it? And when will it end? Thanks.
Ylan Q. Mui: This is a very good point. In fact, one woman I interviewed for this story had thought about getting rid of her dogwalker -- until she learned that the dogwalker had already lost her day job. So she decided to keep her services until she found something else more permanent.
In terms of the feedback loop, see a previous question asked on this chat. There is a core issue of low consumer confidence here that needs to be restored.
Bay Area, Calif.: Given that my husband was laid off two weeks ago, we're coping by drastically cutting back on our expenses. I ran out of saline solution, and am wearing my glasses rather than my contacts. We're not going out to eat. Our cooking has simplified, to cut back on the grocery bill. We are holding off on the major landscaping we planned to do to our front yard, leaving bare dirt around the trees we planted, instead of spending $2k on decomposed granite as we had planned. We canceled our expensive cable package. And you know what? When he does find work again, we plan to continue our thrifty ways as much as possible. It's time our economy be much less consumer-based.
Ylan Q. Mui: Thanks for your story, and I'm hoping that he finds a new job soon!
washingtonpost.com: Spending Graph
Rural Maryland: Are restaurants feeling the pinch? The Washignton Post's own Tom Sietsema says that there seems to be more empty seats at top restaurants. However, the newly opened Cracker Barrel on Kent Island, Md., is packed every time I pass it by. A Mexican joint I ate at in Easton, Md., was packed two Saturdays ago.
Ylan Q. Mui: Funny, I tried to make a reservation in D.C. during Restaurant Week and EVERYWHERE seemed to be packed! I tried about 10 different places before I found somewhere that could take us.
D.C.'s economy is hard to compare to the rest of the country's -- no matter how bad it gets in here, it's worse out there, sort of mentalities. However, there have been several national studies that have shown that people are eating out less in this environment. Particularly hard hit are mid-tier restaurants.
Check out this blog post on Seeking Alpha about Bennegin's and Steak & Ale filing for bankruptcy last year: http://seekingalpha.com/article/87731-bennigan-s-bankruptcy-bodes-ill-for-restaurants
Minneapolis, Minn.: Loved the article! As a recent college grad I've been 'insourcing' as a way of life long before the economic downturn. I one-upped 'insourcing' regarding the sewing kit purchase by actually building one from scratch from my mother's much larger sewing kit. I've also started cutting my own hair -- four times so far, with nary a mistake! A $30 Wahl kit pays for itself after two cuts, and if you go slow and read the directions, it's easy. Heck, if I can do it anyone can!
washingtonpost.com: Home Economics of Anxious Times: Dyeing Your Hair in the Kitchen Sink (Post, Feb. 26)
Ylan Q. Mui: Thanks for your thoughts. I used to pilfer sewing materials from my mom, too, but I'm not sure I'm ready to cut my own hair. Maybe it's just the trauma of having one too many bowl cuts when I was a kid.
Cutting back: This recession IS different -- the impact is much more widespread.
I know our economy depends on spending, but I think it's good people are learning to reuse, repair, recycle and do without. Washing your own dog is a bonding experience!
That said, every service you cut out costs someone a customer/job. We debated whether to stop our housecleaning service, and decided the cost ($90 every other week) was worth the benefit (our socks don't stick to the floor). Plus, three very lovely ladies retain at least one grateful, paying client.
Ylan Q. Mui: I've gotten several comments from folks not cutting back on the cleaning service, which I think is so interesting. It's as interesting me to find out what people *won't* cut out as to hear what they *will* cut out! Any thoughts on this? What do you plan to hold on to and why?
Woman with 2 kids and sheddy-y dog, again: As someone mentioned above, one of the reasons we're not considering firing our housekeeper is because we assume that she's probably lost business due to people cutting back, and we don't want her to become unemployed when we can still afford her services.
Ylan Q. Mui: Exactly to the point! Thanks, Woman With Two Kids And A Dog!
Falls Church, Va.: My husband and I both have jobs that I think are fairly secure. Nevertheless, I find myself being super frugal. We rarely go out any more, I cook almost every meal for us, and I stress out about the smallest things. I guess I don't have a question other than: any advice for staying sane during these crazy times?
Ylan Q. Mui: Hmmm, good question. I'm not really sure that I'm sane enough to answer it! But I think one thing that could help would be to not look at your cutbacks as a sacrifice but rather as a gain.
I try to make dinner at home an "event" by making sure the TV is off and the Treo is far away and focus instead on spending a few minutes of quiet time with my hubby, instead of focusing on the fact that we're not going out to one of our favorite restaurants.
In fact, when I talked to Target's advertising agency about their New Day campaign, these are the types of feelings they said they were trying to convey. They said they have been flooded with e-mails about the scenes shown during the spot for "the new movie night" (popcorn and a DVD on the couch) because it evokes those feelings of family that people felt had been lost during the boom times. In fact, one of the folks at the agency said it's like bringing consumers to the final stage of grief: acceptance that things have changed.
Leesburg, Va.: I have a homemade pizza in the oven right now. I think it cost about $4 to make. We've gone from takeout 2-3 nights a week to none. I notice that many restaurants are responding with some good deals and coupons, though.
Ylan Q. Mui: LOL, my girlfriends say: The deals would be really great ... if I were shopping!
Fairfax, Va.: We moved last year and need to do some home decorating. We'd been planning on spending a bunch on furniture and decor, but are scaling back our plan quite a bit. Instead of the expensive living room chairs we'd picked out, we're getting some from World Market. Instead of buying art, I'm getting frames at Target and looking for notecards, wrapping paper, and craft paper to frame. I even went so far as to rearrange the living room furniture to a layout that requires us to spend less for it to look nice.
My company just laid off 46 people, and my husband's company is making all their managers take pay cuts, so we're worried about money, but are also tired of living in an empty house.
Ylan Q. Mui: These are great ideas, thanks!
Richmond, Va.: The hardest expense to cut back on is the grocery bill! It seems to get higher every week! Prices at the grocery store are skyrocketing. I already shun prepared food as much as possible. But it is eating me alive. My main change so far is to not buy new clothes. I've always shopped the clearance racks, but now not even that. I just lost weight, so I'm trying to sew darts into all my skirts and pants, but don't want to look like a bag lady at work.
Ylan Q. Mui: So you are learning a new skill while saving money! That's a good thing, right?
Washington, D.C.: If you're pretty sure that the person you're tipping won't report the money as income, then tipping is one of the forms of stimulating the economy. The money doesn't have a tax bite taken out of it and it usually gets spent because service employees have to spend to make ends meet. I know that the federal and state tax collectors want their take and we will grow our way out of these deficits once the economy is back on track. In the meantime, the most economically stimulative form of spending to is to tip more, especially if the tips aren't reported.
Ylan Q. Mui: Interesting theory! Hope the IRS isn't reading ...
Services in hard times: I sort of feel like we're in an unending cycle of pain. The fewer services we use, the more folks who provide those services will be out of work, making the economy even worse. What will it take to stop this endless downward spin?
Ylan Q. Mui: I'm not sure anyone really knows. We're in uncharted territory here, so I won't even attempt to pretend to have an answer here. Just wanted to put this thought out there ...
Silver Spring, Md.: Haven't canceled monthly cleaning service or weekly yard maintenance...can't DIY anymore. Still affordable on retired income because still living in same old modest house, no credit card debt, pay cash for cars that are cherished for at least 10 years.
Ylan Q. Mui: Thanks for these thoughts.
Bethesda, Md.: Well, I've instituted "Pay Day Cake Day" at work.
Why? Because if you're there, you're employed. Does anyone need a better reason to eat cake? Plus it gives me a whole lot of unofficial taste-testers and guinea pigs for any strange cake recipes I want to try. My kids don't like nuts, so that leaves out a fair number of cake recipes.
Yes, I find myself baking more cakes for the family too. Which may be good for morale, but it's bad for the waistline if we're not generous with our friends.
Ylan Q. Mui: This is hilarious but a good way to keep morale up!
Chicago, Ill.: I agree with Richmond -- one in three households aren't spending any less? Really?!
This recession is not only bad, but it's much broader than many previous ones. All sectors have been affected and losses are across the board. Regardless of whether your job is secure, your 401(k) has taken a hit, your access to credit has dried up, and your net worth has almost surely shrunk. How so many people, in such circumstances, can continue spending at the same rate is beyond me. Unless they were scraping the barrel to begin with.
Ylan Q. Mui: More thoughts on the poll numbers ...
Frederick, Md.: Well, I'm still taking the recycled non-retrieving Golden Retriever/Chessie mix to the groomer every eight weeks, as usual. Some things ARE worth the money. (That's a semi-shameless plug for GRREAT.)
But I've decided that it's past time to have a container garden in the front yard. Plus a strawberry tower. Yes, I'm investing in netting so hopefully the kids and I will get to enjoy some of those June berries.
Ylan Q. Mui: I am dying to get my own herb garden going. Buying fresh ones is expensive and also wasteful, since I never end up using the whole bunch!
Single mom: I think the will or won't cut a service debate misses a key point -- negotiation. I had to cut my lawn guy way back but I also knew he'd lost his day job. So we talked bluntly and he is happy to have me on a 35 percent basis (vs. previous bill) than to lose my business. this is NOT code for take advantage of people. He makes the same rate when he comes, but for now I can have him come less. Same deal with hairdresser -- I let her know this has to last three months. She's happy I didn't just ditch her and ponytail it...
Ylan Q. Mui: Good points!
North Liberty, Iowa: What about the stress that all of these affected household members are facing?
Doing all these things for yourself saves money and can be satisfying -- but it takes a lot more time! Saturday, I peeled three lbs of carrots, sliced, chopped and diced (much cheaper than buying mini carrots in a bag) but it took plenty of time. Hanging laundry to dry takes more time. Making pancakes and pizza from scratch takes more time. Baking a chicken (instead of buying one roasted at the deli) takes time and more clean-up.
I work full-time and my family can live off just my salary...it's a good thing we can because my husband lost his job last week.
However, we are cutting way back to live on my income alone. The stress I feel is immense: now suddenly, I am the only wage-earner. I earn all our money, drop the kids at school, fix the meals, do the laundry, clean house, wash dishes, think up cheap but edible meal ideas, etc., while he "looks for something" (which isn't a 40-45 hour per week occupation, by the way).
I can tell already that I will not be able to shoulder all the burden for very long. The emotional toll is huge.
Ylan Q. Mui: It sounds like you are doing an amazing job of balancing the pressures of the not only work and family but also the added stress of the recession. You're right about the emotional toll, but I'd be willing to bet if you're strong enough to make it this far -- you can make it the rest of the way.
Ylan Q. Mui: Thanks to everyone for all of your questions and thoughts. I've really enjoyed this chat, and I hope you all have too! If you have any additional comments, you can always contact me at email@example.com. Thanks so much.
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