How can they afford that?

By glblguy

Photo by: nickobec

My wife and I have started watching re-runs of crime shows. We particularly enjoy Cold Case, Law & Order, and Law & Order SVU (Special Victims Unit). Last night we were watching an episode of Law and Order: Criminal Intent and it contained a really great dialog that involved a question I hear frequently “How can you afford that?” I’m quoting from memory here, so the dialog and story line isn’t exact, but hopefully I’ll capture the essence.

A police officer was being investigated by Detectives Robert Goren (played by Vincent D’Onofrio) and Detective Alexandra Eames for using the police computer systems to illegally retrieve criminal records on drug dealers and other “rich” criminals. She would then kill them and steal their money, using it to to live a better than the average cop lifestyle with her mother and two children. The relevant part of the story is when the two detectives are interviewing the officer at her home before they had any hard evidence to convict her. Detective Detective Goren is convinced she is guilty but can’t prove it just yet:

Det. Goren: “What I can’t figure out is how you can afford such a nice house and to send your girls to private school?”
Officer: “I’m frugal”
Det. Goren: “I don’t spend a lot, and I couldn’t afford this house”
Officer: “You aren’t frugal enough”
Det. Goren: “Sure I am”
Officer: “You dress to impress. You are a big man and therefore finding clothes at discount stores that fit you is hard. You use this as an excuse to purchase high-dollar name brand clothing. You’re single and therefore date often. You take your dates to expensive restaurants and drive a nice car to impress them…I buy bargain clothing, don’t date, never go out and live very frugally. I use my money to buy my home instead.”
Det. Gorn: Looking stunned he says “That’s very good, but you still haven’t answered the question.”

Detective Goren has a common problem that many people have: he has no clue where his money goes. He only knows he doesn’t have enough. He thinks he’s frugal and that he doesn’t spend much, but he does.

Here are a few tips for people like Detective Goren:

Track your spending

For the first month we started getting control of our finances, I tracked every expenditure we made. At the end of the month, we totaled up everything and were frankly pretty surprised at how much things like eating out, coffee, convenience store drinks, etc add up. We found a number of areas where we could cut back. Doing so was like getting an immediate raise. Buy a cheap little pocket note book and keep it with you. Record every expense and categorize it. Use that to feed into the next tip and reduce your expenses.


Create a budget and manage your finances rather than your finances managing you. Tell your money where to go. Use the notebook from the previous tip as input into your budget process. Find areas where you can cut back on your expenses and put a cap on them. Currently spending $50/month on Starbucks coffees? Create a coffee budget category and cap it at $10. Make your coffee at home instead. This will allow you to treat yourself to a Starbucks coffee without spending more than you want. I’d recommend using an excel spreadsheet or You Need A Budget to track and manage your budget.

Make an effort to find the lowest price and be patient

Too many people decide they need something, say a new pair of shoes or a new sport jacket, and just run out to the local mall and get them. Sure you get what you need, but you most likely paid way too much for it. Instead shop around at the various stores. Bring a small notebook and write the prices down. Shop around online as well and see how online prices compare (don’t forget to factor in shipping). Most importantly, be patient.

I had been wanting to purchase a couple of sport jackets for at least 6 months or so. Everything I saw was $60 and up. While $60 for a sport coat isn’t too bad, it was more than I wanted to spend. While walking through Wal-Mart one evening, I saw some sport coats on the rack and thought I’d take a look. Turned out there were marked WAY down. I got them for $19.99 each! I saved $40.00. I bought two of them, and have been very happy with the quality and look. Dressing to impress doesn’t mean you have to buy your clothes from Brooks Brothers.

Prioritize your spending

Detective Goren was a bit jealous that he wasn’t able to afford a nice home, yet continued to spend his money on expensive clothes, dates and car. While the officer stayed at home, lived frugally (or so it seemed) and had a nice home. If Detective Goren wanted a home that bad, he needed to make it a priority and set a goal. What are your financial goals and what expenditures are keeping you from reaching those goals? Make a plan of how and when you are going to reach your financial goal and make that a priority when doing your budget and managing your finances.

Turns out Detective Goren was right. The officer was in fact stealing money to support her “above average police officer lifestyle”, but I think the basic principles she shared with Detective Goren were dead on. So next time you say to yourself “How can they afford that?“, consider that maybe they’ve made it a priority.

We have 6 children, and constantly get asked how in the world we afford them. I don’t ever really have a good answer, except that we just do. I know my wife and I make them a priority and adjust our expenses accordingly. I am sure that’s a big part of it. It’s truely amazing how much you can stretch each dollar when you have to.

Do you budget and track your expenses? Do you know where your money goes? Do you know where your money leaks are? What tips can you share to help people manage their money better and live more frugally?

25 Responses (including trackbacks) to “How can they afford that?”

  1. Mrs. Micah Says:

    Kill rich criminals and take their money….why didn’t I think of that? Oh, right. Morals and all that.

    Great analysis…I think she was dead-on too. Maybe she couldn’t have afforded quite that good a house, but she probably could have afforded more than he could just by sticking to the principles she mentioned.

  2. Anne Says:

    She should have told him she received an inheritance. :)

    Just kidding. Great post.

  3. Dan Says:

    In a similar light, I will relate the off-hand comment which changed my life. I’m an accountant, and I was preparing a return for a couple. I looked at his W-2 and asked for hers. She fondly ran her hand in her husband’s hair and said “My man makes too much money for me to work!”

    I was stunned. I made more than he did and my wife had to work. Or so I thought.

    It turned out that, after getting on a budget and then spending a while (a long while, as it happened) getting my financial house more in order, she didn’t really have to work after all. Now my wife stays home with our children, and I hear my friends, neighbors, and family also claim the wives “have to work.” In most cases, they don’t. They just haven’t made it a priority to stay at home.

  4. Esther Says:

    My husband and I have been really trying to track all we spend. We know we are going into hard times because my maternity leave is over in a few months and just our monthly bills (not including groceries, etc.) are barely covered by my husband’s pay check. We were trying to see if I could stay home and by tracking we found out it would be impossible. We had already been living as frugal as we can, so changing our spending hasn’t done much except cause tension between my husband and I. He keeps saying that we still need to ‘live’ a little. I get too caught up in trying to save money that I end up focusing on it too much and don’t buy anything or feel really guilty when I buy something even if I really need it.

    Has anyone used the program ‘Moneywell’? We’ve been using it for the last three months and it has been great for us!

  5. Dan Says:

    Esther, I don’t know your circumstances, but before you go back to work, espicially if you don’t really want to, please consider:
    1) Reduce your projected salary by 7.5% for payroll taxes
    2) Reduce it further for whatever your income tax bracket is.
    3) Reduce your take home by whatever you will pay for day care
    4) Reduce it for the extra you will likely be spending on buying lunch and breakfast as opposed to making it (for you and your husband, if he now can take his lunch). It’s more difficult to bring your lunch if you both are very busy. Also, consider you might also eat out for dinner more if you are both so busy and tired from work.
    5) Reduce it for the extra car and transportation expenses (about 50 cents a mile is a good rule of thumb)
    6) Reduce it for the extra clothing expenses you will now have to spend on yourself (especially if you will be working in a professional environment).

    After you do all of these things, ask yourself, Am I willing to spend 50 hours a week away from my child for the remaining amount of money? If so, and for many it is, then good. Just go into it with your eyes open.

    On the other hand, once you know the true monthly contribution of your income (your take home after all of the above reductions), maybe you can get creative? Are there any kids in the area you can baby sit? Could you or your husband moonlight a little in the evenings or weekends to make ends meet? Do you really need a second car (if you have one)? Just a little here and there may effectively substitute for you getting a job.

    Of course, you might want to work even if you can afford to stay home for other reasons. Like I said, just make your decisions with your eyes open, knowing all the other options you can explore.

    Good luck!

  6. Money Blue Book Says:

    My problem is that I automate all of my bill payments so much I sort of lose track of what expenses I actually incur. Still a work in progress for me.

  7. JvW Says:

    Great post! I think the key to anything is making it a priority. Right now for us it’s “would I rather go out to eat or get out of debt?” and then later it can be “would I rather go out to eat or be able to move?” It’s all in how you think about it, and, unfortunately, too many people don’t think about it at all.

  8. kim Says:

    That is pretty good dialog, I wonder if it hit home with anyone?

  9. The Dave Says:

    Like with many things, bargain hunting is only useful if done appropriately.

    My mom is a classic example of bargain hunting gone wrong.

    A recent example, her fish tank timer died, and she asked if I would mind tagging along to help her find a good one on the way home from lunch out.

    Over the next three hours, we spent approximately $8 on gas driving to seven different stores to find the cheapest price with a couple unusual features. Eventually settling on the second store we visited, we returned and bought the timer.

    Timer prices ranged from $18 (the one we bought) to a little over $100 (the first one we looked at) for the feature set we wanted.

    So, the math looks something like this:

    Timer+Gas+coffee = $18+$8+$5, for a grand total of $31.

    Had we picked up the $100 timer and put in some time at the office, we could have saved $8 in gas, $5 in coffee, and blown an extra $82 on the timer. Both being contractors, I bill out at $100/hour, my mom bills out substantially higher then that.

    Since we spent about three hours looking (vs the over-estimate of an hour to just grab the first), that $18 timer actually cost us closer to $500.

    And the punchline to this joke? The timer was DOA, and ended up getting returned anyway.

    Being frugal isn’t a bad thing, but you should think twice about how much your time is worth — Even if you’re not otherwise employed, if you’d come out ahead picking up a minimum wage job and putting in a couple hours as a Walmart greeter, maybe your time is better spent then pinching that last penny.

  10. thebaglady Says:

    I find it interesting that the “frugal” woman is the bad guy, though. It would have been a cooler story if she were innocent and is actually frugal and someone else is the culprit or something.

  11. Ron@TheWisdomJournal Says:

    I used to wonder how those guys on Miami Vice always drove a Ferrari. Oh no, I think I just revealed my age!

    Seriously though, I’ve known police officers that were able to buy some nice stuff because they knew when the auctions were coming up for drug dealer goodies. One guy bought a $600,000 6 bedroom/7-1/2 bathroom home for $100,000 at auction. Pretty smart if you ask me.

  12. Chief Family Officer Says:

    LOL! That scene caught my interest last night too! Even though the security officer was the “bad guy,” I loved her for it. :D

  13. paidtwice Says:

    But what kind of message is the show sending? because she was, in fact, killing people for the money not living frugally.

    I think it was sending a message that frugality doesn’t really work. And that is sad. :(

    I do like the post though. True dat. I was the same in I was spending a lot more on random crud than I thought I was. i wasn’t living extravagantly but I certainly was not living frugally.

  14. Xeresa Says:

    One point that wasn’t brought out was that Detective Goren wasn’t spending his money on expensive dates all the time, or even most of the time. Actually, he is a rather shy, lonely guy. The bulk of his salary was spent on his schohophrenic mother, and keeping her in a nice hospital situation.

    He spoke to her every day, sent her flowers, was constantly concerned about her medications, and, when she contracted cancer, he spent less money on his clothes and other luxuries(as shown by his detroriating sartorial elegance) and kept spent his own money for a nice hospice care for her.

    Add to that, the money he spent on his drug-addicted brother down through the years. He really was living frugally for a single man who “couldn’t shop at discount stores for clothes and his luxuries were on the small scale!

  15. Justin Says:

    I have to agree with the people not finding much good in the message from the show. So what if she put up a big front, in the end it wasn’t her financial acumen that was providing the housing and schooling and whatever else to provider for her family, it was the killing and the stealing.

  16. glblguy Says:

    My point in writing this was to address the topic of knowing and understanding much you spend. The dialog between the detective and the officer was what made me think some about it.

    I know before I started tracking my finances, we had ton’s of little money leaks and at the end of the month would wonder where our money went and then wonder how our neighbors affording that new car, or the improvements to their home. The answer was we were blowing that money elsewhere.

    I was not trying to prove frugality or that she was even a frugal person only trying to raise the question of do you know where your money goes?

  17. rstlne Says:

    It’s a weird story. Why would someone who’s frugal need to kill rich criminals? Unless, of course, she’s a frugal sociopath.

  18. Mel Says:

    I use a spreadsheet to track all my expenses, not just those I’ve paid but those I anticipate having to pay in the coming months. Just put in the days you get paid and the amount of your paycheck as a positive number, say for a month or two, then put in all the bills you know you have to pay, mortgage, car ins/pymt, daycare, grocery (estimate), etc. for the next 2 months as negative numbers, especially anything that is recurring. Then use another column to keep a running total. I do this in sequential reverse order so that the amount at the top is the future amount.

    It has really helped me keep track of my bills and also helps me know how much I can spend. Savings transfers are included just like a regular bill of course :) That way you can’t ignore it.