How To Save & Make Money in a Recession

The Brick Much of what I hear about the economy today is doom and gloom. But personally, I’m hopeful. The market is cyclical. It’s always been this way, for as long as it’s been around. That means it’ll rebound someday.

In the meantime, there are ways to take advantage of this falling economy. There are lots of ways to save money – and even make money!

Here are 10 tips on how to do that:

  1. Short Sell the Market

    Short selling is a method of making money when something loses value. For instance, you could “short” a stock and make money when its stock price falls. And as you can see, lots of stock prices are falling right now. However, the SEC can sometimes place temporary restrictions against short selling, which it did earlier this season.

  2. Buy Low

    Prices fall in recessions. That means you can make some great buys at great prices! Assuming you’ve got the money, of course. But if you do, this is a fantastic time to pick up some choice stocks. Then, when the market rebounds, you can sell those stocks for a tidy profit. Buy low, sell high!

  3. Negotiate Your Credit Card Rates

    Lots of credit card companies will give you a lower interest rate if you just ask. It helps if you have a good credit history and have been a long-time customer though. But even saving a few ounces of a percentage point can add up in the long run, so it’s worth asking. Then, if you must use a credit card, use those with the lowest interest rates first.

  4. Trim the Fat

    Review your bills and pay attention to where you could tighten up your belt. You might be paying a recurring fee for something you don’t really use. Maybe your barely-used gym membership could be ditched in favor of joining a weekly running group. Or maybe all those extra cable channels aren’t really necessary.

  5. Buy Used Items

    If you can make do with a used item instead of a brand-spanking-new one, do it. Lots of people are selling their stuff now – especially on eBay (EBAY) and Craigslist. That means lots of potentially great bargains. A recession is a great time for bargain hunting and finding cheap, high-quality stuff.

  6. Sell Your Stuff

    And speaking of used items, if you have a bunch of stuff lying around that you’ll never use, sell it. If there’s absolutely no more use for it, why not squeeze a buck or three out of it? The downside is that you won’t be able to fetch as great a price if the economy was better. But if you need cash right now, this can help. You’ll be able to clean up some of that clutter in your room too.

  7. Buy Bulk

    You can often get more value for your dollar if you buy from wholesalers and discount warehouses like Costco (COST). If you’re a single person living alone, this might not be worth it because of the annual fees, but if you’re in a family or multi-person household, the savings can add up over time.

  8. Do It Yourself

    There are lots of things you can do yourself. Wash your own car, make your own lunch, fix your own plumbing, etc. Search online or check out your library for a do-it-yourself guide for any task. You’ll gain the added benefit of learning new skills too. The downside is that this can take up a lot of time, which may not be feasible for everyone.

  9. Do Free Activities

    There are lots of ways to spend your time without spending a dime. I’ve got a long list of free stuff to do in San Francisco. I’m sure there are similar lists for your city too. If not, some common options are parks, museums, and art galleries. And if you love to read, check out your local library too.

  10. Prioritize, Prioritize, Prioritize

    Finally, be strict about your true priorities. What is absolutely critical to you? Every decision you make has trade-offs. If it is absolutely necessary that you splurge on that new sofa, then you’ll have to hold back on dining out every Friday night. Or, if money is that tight and simply putting food on the table is a priority, then cut back on all family vacations.

I hope these tips help. Do you have any more money-saving or money-making tips?

Marketing with Gas Saving Tips

Fricken hell. I just paid over $50 to fill up my gas tank. Way over $50. What I wouldn’t give for a hybrid right now (and a hybrid & electric vehicle refueling station!).

With that said, everyone and their Mommas have been trying to cut their gas bills. The smart folks at saw an opportunity in this and recently sent out an email newsletter full of gas saving tips, along with a gentle reminder to check out their products too. is an ecommerce shop that specializes in aftermarket car parts and accessories. The CEO, Mike Brown, started this site in 2005 with a buddy to sell parts for modifying BMWs. They started this while still in attending undergraduate classes at Chapman University. A year later, at the young age of 21, Brown was named the Global Student Entrepreneur of 2006 by the Entrepreneurs’ Organization from among 10 finalists from the United States, Canada and Sweden. Smart guy!

And their gas tips are pretty smart too:

At the Gas Pump

  • Buy gas at the coolest times of the day usually early morning or late afternoon when the sun is not up. At these times, the gas is the most dense, meaning you pump more gas in early mornings or late afternoons than at noon when the sun is at its highest point and density of gas is less. The gas pump measures volume of gasoline pumped through, not density.
  • Avoid topping off the gas tank, overfilling causes the gasoline to slosh around inside and leak out of the gas tank

General Driving Habits

  • Traveling at fast speeds in low gears can consume up to 45% more fuel than is needed.
  • At highway speeds, use your a/c, and on city streets roll your windows down.
  • When possible use Cruise Control. On highways constant speed, in most cases, saves gas.
  • Drive at a steady speed. Constantly slowing down and speeding up consumes gas.
  • Avoid tailgating. Not only is tailgating unsafe but the driver in front of you is unpredictable and can slow down at any second.
  • When driving up to a hill, if you must accelerate, do it before you reach the hill, not on it.
  • Try to avoid driving on rough roads when possible. Dirt and gravel roads use up to 30% of gas mileage.
  • Stoplights are timed for motorists advantage. Staying at the speed limit increases the chance of having green lights all the way.
  • Remove excess weight from trunk or inside car – spare tires if you have roadside assistance, backseats, and unnecessary heavy parts. The more weight in your car the less gas mileage you get.
  • When traveling, use as much trunk space and cab space as possible to avoid using a roof rack that creates drag on the highways.
  • Carpool. All riders help you buy. Carpooling reduces the amount of cars in traffic.
  • During cold weather check car for ice frozen to the frame of your car. 100lbs can be quickly accumulated.


  • Avoid warming your car up for prolonged periods of time 30-40 seconds is enough time.
  • Idling your car for one minute consumes the same amount of gas when starting. Don’t stay in a drivethru go inside.
  • Avoid “revving” this wastes fuel needlessly and washes oil down from the inside cylinder walls resulting in loss of oil pressure.
  • Accelerate slowly from a complete stop.

Recommended Check-Ups

  • Get your car checked regularly to guarantee the best fuel economy for your vehicle. Keeping air filters clean maintains good fuel economy.
  • Use recommended grade of motor oil.
  • Inspect chassis and suspension parts for occasional misalignment. Bent wheels, axels, bad shocks, broken springs, etc. can create engine drag and are unsafe at high speeds.
  • During good weather season remove snow tires, traveling on deep tire tread decreases gas mileage.
  • Keep tires inflated to the maximum recommended limit. Get tires periodically spun, balanced, and checked for out-of-round. (check manufacturer’s specs for max tire pressures).

Air Intake Advantages

  • There is common misconception regarding intakes. Some people believe that it is only for making your car louder. Although this is true, an air intake system does more than that. Not only it make your car sound better, but it will also give you more horsepower and more miles per gallon. Since the engine is breathing easier, it doesn’t have to work as hard to produce its power.

    Therefore you use less fuel. If you wanted to take your performance and your miles per gallon even further, then I would recommend replacing your catalytic converters to Hi-flow catalytic converters and install a larger-diameter exhaust system. Both improve exiting airflow from the engine and increase horsepower along with increasing your miles per gallon. Since you are saving money at the pump, these modifications will soon pay for themselves.

    With 18 mph with your stock intake, we calculate that with an aftermarket intake you should save approximately $500 per year by using an aftermarket intake of good quality. This is based on 30 miles per day of driving at $5/gallon.

Traveling Tips

  • Before driving, plan your route. Determine your destination(s) and find the best way there–this includes the distance needed to travel to the destination, the amount of traffic involved during your commute, and the time of day you travel. Planning your destination ahead of time will help you save a significant amount of gas and time during your day.

    There are GPS devices today that include live traffic information features that will help you during your drive to your destination.

Low Price Gas Locator Websites

  • – can help you find cheap gas prices in your city. It is a network of more than 181+ gas price information websites that help you find low gasoline prices. All web sites are operated by GasBuddy and has the most comprehensive listings of gas prices anywhere.
  • – Mapquest Gas Prices finds the cheapest gas prices in your area. Helping you save money on your next gas purchase.
  • – provides you with Gas Prices, Gas Mileage Tips, Articles on Hybrid, Diesel, Alternative Fuel Vehicles, and more!

Great tips, huh? An email newsletter with this much content is sure way to get forwarded to friends and friends of friends. The tip I most appreciated was buying gas at the coolest times of the day. I’ve heard most of the other tips before, but not this one.

A smart email marketing move if I’ve ever seen one, especially with today’s gas prices. Brown & everyone and their Mommas thanks you.

Money CAN Buy Happiness

Can money buy you happiness? The short answer: YES.

Justin Wolfers, a frequent guest blogger on Freakonomics and an Assistant Professor of Business and Public Policy at The Wharton School of the University of Pennsylvania, recently wrote a series of posts on The Economics of Happiness:

UPDATED 5/1/2008: I’ve added parts 5 and 6 to the list.

  1. Reassessing the Easterlin Paradox
  2. Are Rich Countries Happier than Poor Countries?
  3. Historical Evidence
  4. Are Rich People Happier than Poor People?
  5. Will Raising the Incomes of All Raise the Happiness of All?
  6. Delving Into Subjective Well-Being

In these posts, he provides statistical evidence that:

  • Rich people are happier than poor people.
  • Richer countries are happier than poorer countries.
  • As countries get richer, they tend to get happier.

In this CNBC video with Wolfers and Betsey Stevenson (also an Assistant Professor of Business and Public Policy at Wharton), Wolfers explains that the survey questions included, “Did you smile a lot yesterday?” and “Did you laugh a lot, yesterday?” – which can offer more absolute measures of happiness than simply asking, “How happy are you?”

As it turns out, richer people smile and laugh more often than poorer people.

This all comes in stark contrast to the Easterlin Paradox, which postulates that relative income – the amount you make compared with others around you – is more important than absolute income. In the CNBC video, Stevenson states that relative income is still important, but it may not be as important as the Easterlin Paradox suggests.

In the NY Times article, “Maybe Money Does Buy Happiness After All“, Richard Easterlin (a Professor of Economics at University of Southern California) agrees that people in richer countries are more satisfied, but isn’t sure that their wealth is causing their satisfaction—their survey answers may be reflecting cultural differences and offering skewed data.

Still, the data Wolfers and Stevenson have amassed is pretty compelling. They combed through reams and reams of post-war surveys and research to come up with their conclusions. Take this chart from the 2006 General Social Survey, for instance. The survey asked: “Taken all together, how would you say things are these days?”

Looks like money is sure buying happiness for the rich here.

Getting the Cheapest Deals on and I’m all for saving money. How about you?

That’s why I squealed like a schoolgirl in front of Justin Timberlake (ew, I can’t believe I just typed his name; I have to wash my keyboard now) when I heard about is a forum where members list the their winning bids for airlines, hotels, and rental cars. Friends tell me it’s best for hotels though. This means you can find out about how much you should bid for a particular hotel (or class of hotels) and be reasonably sure you’ll get it.

And guess how much this information costs? My favorite price: free!

Without this information, you might pay more on than is really necessary. If you try to bid on a hotel right now, a suggested price range for each class of hotels will be given to you. However, these ranges are generally higher than a what those hotels will really accept. And even after making your bid, will warn you to increase your bid to better your chances.

Why, Shatner, why? Aren’t you here to help us save money?

Of course, you could just as easily enter in too low a bid. All of us would love to pay $10/night for a midtown hotel in Manhattan, but it ain’t gonna happen. So that’s where comes in.

Here’s how it works. Say you’re going on a trip to NYC and want to stay somewhere near Times Square. You can:

  • Browse the forum

    For instance, you can look under the NYC hotels section and go through its hotel list, which includes reviews and previous winning bids.

  • Search the forum

    The search box is sort of buried in the middle and uses Google’s search engine. Pretty simple to use once you spot it.

  • Ask for “Bidding assistance”

    This is where you post a message asking for help in getting a particular bid. Before you do that though, you’ll need to familiarize yourself with their posting guidelines.

Even though the site looks like a rainbow got drunk and threw up on it, it’ll save you both time (from entering in a bid too low) and money (from entering in a bid too high). That makes and a pretty damn awesome tool for thrifty travelers.

UPDATE 2/21/2008: A buddy just told me about a similar site called BetterBidding.

Investment Advice from a Cab Driver

“You know, I’m semi-retired right now,” said the cab driver. “I was able to do that through investing in the stock market.”

“Really?” I asked. “How so?” I decided not to bring up the fact that he was driving a cab.

“I have a degree in Chemistry. I used to work for a dot-com. When the dot-com bombed, I was left with some money. I used that money to begin learning the stock market.”

The car sped down the 101 and darted between slower cars. “I started small,” he continued. “First, I invested only a little. I read a lot of websites and magazines and books. I studied a lot. Everyday. My wife would come home and complain about all the financial reports I had throughout the house. I told her, ‘But this is how I’m making us so much money!'”

I laughed. “So you built up a portfolio through reading all this stuff. Let me guess, you’re a value investor?”

He smiled into the rear-view mirror. “No, not really. I invest in one stock a year.”

“One stock a year? So… you don’t diversify your holdings?”

He shook his head with a grin. “Nope. I spend six months researching and researching. Then, after six months, I select a single stock I want to invest in for that year, then I put all my money into it.”

“Interesting. Sounds risky for the average investor, but since you’re an educated investor…”

“Exactly,” he added. “For six months, I study everything about a particular company. I study the executives, their backgrounds, how many shares they hold. If the CEO holds many shares of that company, that’s a good sign. If he’s selling most of his shares, that’s a bad sign.”

“True true,” I laughed.

“I study the product, the market, it’s competitors, everything. Even if the stock has a sudden spike while I’m researching, I don’t buy it. I only buy it after I’ve completed my research and am very certain that it’s a good buy.”

“You must be a very patient man.”

“Yes, I am very patient. You have to be if you want to be a good investor. I’ve been doing this for thirty years now. I started doing this at a young age. In the twenty years since I started the one-stock-per-year model, I’ve only lost money once.”


He nodded with a broad smile. “Just once. I started with penny stocks, since they were very cheap. Even now, I’ll purchase low-priced stocks. Right now, I’m holding about 50,000 shares of a $1 stock. So when it moves up to $2 and $3, well…” he beamed.

“Wow.” I shook my head. “That’s awesome.”

“When I started, I didn’t have this much money, of course. In the beginning, I lost a lot of money. Just like everyone else in the dot-bomb. But every time I lost money, I’d study my decision making analysis to understand why I made this mistake. I’d study the stock more, the company more. I analyzed why the stock lost money. And I used those learnings to improve my investment decisions going forward.”

“And now you’re semi-retired,” I stated.

“Yes. Now I am semi-retired.” We pulled up to my destination. He stopped the car, then turned around. “I tell you, investing is a very important skill. You should learn it. Start small and study your mistakes in the beginning. Do a lot of research and be very patient. Do that, and you’ll be able to retire too.”

I thanked him and got out of the cab. I waved as the cab drove off. Only in Silicon Valley can you met a semi-retired cab driver who makes his money with $1 stocks.