Each time I come home, I reflect on how fortunate I am to have parents who love me, my husband and my son, and how thankful I am for their persistence in teaching me so many life lessons. My parents never sat down and talked to us about money (other than to tell me to stop lending money to my siblings if I wasn't going to keep track of IOU notes), but as they say, "more is caught than taught." My parents taught me a ton about money, without "teaching" a single lesson.
My parents aren't what you would call big frugalers, but, in my opinion, they are great with money. I aspire to their level of financial peace, their generosity, and their willingness to take finances so lightly that its almost a source of humor to them. They are both thoughtful and decisive when it comes to earning, saving and spending money, but they don't clutch their fists around their decisions and plans. They can do this because they've built up some awesome systems, including my dad's patented value menu approach to spending. It is alternatively called, "Why my parents have way better stuff now than when we were kids."
First understand that you don't understand
When we were young, my dad would sometimes take me, and my two brothers and my two sisters to McDonald's, and he would ask us what we wanted to eat. I'm not sure why he did this, as it had no bearing on what he ordered. He normally bought two Big Macs, 3 cheeseburgers, 3 Chicken Sandwiches, two Super Size Fries (this was prior to the 2003 demise of Supersize), and a large soda. He would then take the food to our table, and allow us to select our sandwich of choice. Sometimes, we would question why he hadn't gotten the McNuggets or the Happy Meal we requested, and his response was, "If you still want something after this, you can order it."
*Please note, we weren't a particularly healthy family, but this type of junk food feast was truly rare.
We would happily munch away on our super-processed foods. We got to take turns filling up the drink (but we always made my brother go last, because he got nasty orange drink), and by the end of the meal, we were all satisfied or we weren't. If we were still hungry, my dad would give us a dollar or two, and tell us to buy more food. We could get what we wanted. Usually we bought a shake or more fries, but sometimes we came back with another burger or two.
If you're eating expensive crap, does it matter what you order?
The entirety of my dad's initial order would always come in under $14 including tax. Even back in the day, $14 for a meal for seven people (if my mom tagged along), or six without her, was a pretty screaming deal. Not only that, if we weren't satisfied, my dad promised that we could have more.
That was the key to the value menu approach... "If we wanted it, we could have it," but we couldn't have more if we didn't want it. It would have been easy for my dad to buy a happy meal or a value meal for every person present. It would have run somewhere between $25 and $35 for that type of order. In all honesty, very little of the food would have gone to waste (it's not like we're light eaters in our family), but a lot of money would have gone to waste.
By ordering a certain amount of food, sort of a baseline of "enough", my dad was able to keep costs 40-50% lower than if he made no effort whatsoever. And we weren't any less happy as a result. If one sibling (okay, if my youngest brother) ate all the fries before anyone got a chance, we were allowed to order more. When I requested money for a chocolate shake, we always got to enjoy one.
Since we weren't used to the luxury of eating at McDonald's, my dad made a wise choice to keep things low cost when our enjoyment was highest (at the beginning), and then loosen up at the end if we still wanted more. The value menu approach isn't about saying, "No", it's about saying first enjoy it, then decide if you want more.
The Value Menu Approach isn't just for fast food
All of these improvements are examples of luxury spending. They've taken a modest house, and turned it into something that on its best days (when we aren't around) could grace the covers of an interior design magazine. But their luxury spending is never done all at once. Instead they consider modest upgrades carefully, and as they discern that they truly want more, they indulge.
I've also noticed that their spending may have increased in recent years, coincidentally corresponding to a decrease in the number of kids living at home. I'm not saying that, "you kids are the reason we don't have nice things," needs to be true, but I'm fairly certain that it's a core tenet of the value menu approach.
The value menu approach is serving them well, but I'm trying to figure out how I can adopt in my own life.
How I'm using the value menu approach
Of course our recent downgrades in our remodel aspirations are an example of the value menu approach at its finest. If we would have paid someone to do all the work at the outset, we would have overspent for a minimal value add, but I think I see this in other areas too.
I also use this approach in grocery shopping (first trimester aside). I love luxury ingredients, but I buy my baseline ingredients at Aldi. Then I can upgrade with a few nice spices from Penzey's, a luxurious Vanilla Extract (homemade), and fresh herbs from the Farmer's market (or my garden). Not every ingredient has to be of the finest quality, I can often whip up super-delicious meals with fairly basic ingredients (though that Northwoods Seasoning Blend from Penzey's really never hurt anyone).
I imagine that if we ever live near to water, this is the approach we'll take with a boat. Sure, I would love a speed boat with the capacity to make huge wakes, but I might be just as happy with a Canoe.
I think that I could benefit from applying this technique to almost any spending category that falls strictly outside of the realm on necessary. Even my sacred cow of childcare. (Will I apply it there, almost surely not, but I definitely started at the high end of luxury instead of deciding to upgrade as I went).