There are two types of people in today’s fast-paced market – the general consumer and the frugal consumer. Which one are you? And why does it matter?
Some time ago, the National Geographic revealed a shocking figure reflecting today’s massive consumerism boom. The report stated approximately 1.7 billion people are members of the “consumer class”. These groups of people followed material-centered needs like bigger houses, expensive clothes, and flashy cars.
This lifestyle comes with costs unseen in store price tags. The gallant title of an active consumer is also the same population suffering from financial challenges like debt, academic fees, and unstructured retirement plans.
Luckily, no one needs to be living within the top 1 percent to save money without depriving themselves of essential purchases. The secret lies in living a frugal life. Some people seem to mistake frugality with deprivation. When in reality, it’s quite the opposite. Nevertheless, this post will reveal the quite underappreciated beauty of being frugal.
What Does Frugal Mean?
By definition, frugality is a personal trait present in prudent people who engage in saving and reducing economic or environmental waste. Other words are tied with frugality, such as “thriftiness” or “being economically conservative”.
While these synonyms are correct, frugality is more about being wise rather than being thrifty or sparing. See, anyone may easily choose not to spend on anything over a specific period. It’s easy to secure earnings in a locked safe. But it’s not advisable since humans still need to meet daily needs to function well.
What does frugal mean? For one thing, it’s not a conceptual device that’s intended to make one’s life miserable. It’s not imprisonment; it’s actually freedom. Love or hate the concept, frugal people have their lives more manageable than those who aren’t. They are probably the ones who feel and indeed are more secure financially, emotionally, and mentally.
The Importance of Being Frugal
Asking financially stable people tips on how to live frugally and happy won’t exactly result in a fair conversation. How and why people save money are questions that don’t have a single and universally accepted definition.
Put simply, knowing the importance of being frugal is a subjective and personal discovery. Some people might not need the aspect of reducing consumption the ways that others do.
Here are 6 reasons to be frugal, before going over 15 tactics themselves.
Depending on the person, here are some consistent realities that point to the importance of being frugal and why everyone should practice it.
Reason #1. Debt
Debt is such an ugly word and a harsh reality to many. One study reports around 80 percent of Americans are hitched by small to vast amounts of debt. Thinking about it, that’s the majority of the entire country’s population.
At the same time, 22-year-old college graduates may begin their careers with debt amounting to around $35,000 in student loans. Mortgages are found to be the most common debt in America. This is followed by card balances, car loans, and student loans.
Despite what kind of form debt presents itself as, it is almost never good news. Still, people need to file debts to go to college, pay off medical bills, or even eat sometimes. The issue is not found with growing debt but with paying it off. Also, financial obligations can follow interest rates of credit, and this can overwhelm most people.
With the right strategy and frugal mindset, debts can be paid off before accumulating to a larger amount. Through getting a higher paying job or getting a second one and dedicating this earning to debt payoff, the problem can be reduced.
Reason #2. Inflation
Inflation is best described in practice, as in buying groceries. Ask an older person how much food use to cost and the difference can surprise anyone. For instance, today’s slice of bread costs around $1.60, whereas it only cost people $0.12 in the 1950s. Is this some sort of unfair treatment? Not really; it’s just inflation.
This economic phenomenon pertains to the rate of the increasing price of goods and services in a country. The inflation rate is linked to a currency’s purchasing power. As time goes forward, experts believe the inflation rate will increase over time. While many factors affect this claim, one can never be too prepared.
Indeed, the economy will fluctuate over time. The value of one’s cash now might not mean a lot in the future. To safeguard one’s lifestyle, adapting a frugal mindset is both a free and easy way to manage cash flow.
Reason #3. Career Decision
A recent article discloses that about 3.9 million individuals left their 9 to 5 jobs last June of 2021. What’s causing this global shift in career-making? The answer is simple. As technology advances, people are taking a step forward in pursuing businesses and other professions.
People are starting to monetize art, build portfolios, and go independent as their full-time source of income. It’s no denying that doing so frees a person from their current workplace.
Though what most people fail to see is how shifting careers needs initial capital to begin. Whether the decision is starting an online business or leaving a job to pursue the arts, we all need money to begin with.
Being frugal is one of the simplest things people can adapt to, creating income streams for themselves. It’s like an insurance option to support them, just in case they decide to shift careers in the future.
Reason #4. Retirement
Eventually, employees in the workforce are bound to consider retiring once they reach a certain age. Splurging on costly desires may lead to financial complications in the long run.
Many responsibilities come with age, like college fees for children, mortgage, medical bills, and even food for daily consumption. Like everything listed in this article on how to live frugally and happy, knowing when to keep the wallet shut will do everybody good.
Reason #5. Emergencies
Emergencies are nasty surprises. Not only are they unpleasant, but they’re also expensive. We’ll never have complete control of what’s about to unfold in our lives. So, it’s always better to have an extra emergency buck, just in case someone gets sick, loses a job, or experiences an accident.
By following a frugal lifestyle, people are also caring about their loved ones. With emergency funds, their families are given an extra layer of security. The most common downward effect of not having an emergency fund is debt. When accidents happen and a person doesn’t have extra cash to spare, loans are the way to go. All these can be avoided with simple steps concerning how to live frugally and happy. And guess what? Doing so is absolutely free.
Reason #6. Mental Clarity
Ever encountered people practicing a minimalist lifestyle? Actually, being frugal and living a minimalist life are linked. This practice is all about cutting down on the possessions and generally spending less on products. Minimalism’s concepts go against consumerism and other marketing tactics.
However, people don’t do this for no reason. It has been found that having fewer possessions does more good to one’s mental health. Those who advocate this lifestyle believe that owning many items creates unhealthy materialistic attachments that affect one’s sense of purpose.
Ever notice how some people feel the need to buy something before actually feeling happiness and value over their lives? The best way to combat this mindset lies in discipline and wise choices. Thus, many confirm that cutting on purchases is a mind-shifting choice.
The 15 Great Frugal Living Tips
Here’s a typical story many are familiar with. Someone wants to save and asks a friend, “what does frugal mean?” Most of the time, peers respond with big deeds like building your own house out of nothing or completely shutting down trips to the mall. While these seem like probable ideas at first glance, they’re never sustainable. And ironically, some of these frugal tips can cost more. With that, below are the best frugal living tips that are easy and sustainable.
1. The 50-30-20 Rule
Some of the most common ways people spend their income on are the following… groceries, alcohol, subscription plans, mortgage, and children. There’s nothing wrong with purchasing essential products. Humans need to eat and go out to live comfortably.
But is it possible to still get these items without breaking the bank? Actually, there’s one secret that enables people to buy goods without falling too much behind – expense dividing.
The 50-30-20 Rule is a technique used in saving money effortlessly. The idea basically goes like this…
- 50% Essential or leisure.
Food or groceries, rent, water, utilities, medicine, and other essential needs.
- 30% Investment expense.
The stock market, real estate investments, index funds, or a business.
- 20% Savings expense.
Savings account or emergency account and retirement plans.
The breakdown of the 50-30-20 Rule is a tool used to divide cash flow without any significant inconvenience. Many think that people can only apply this method when having high-paying careers. But that’s not true at all.
Whether it’s just $100 or $10,000, this money-saving tool is useful. The 50% used in savings and investments might not sound like a lot. If one is looking at the big picture however, this practice makes a lot of difference.
2. Plan Meals
In reality, losing money is a result of poor planning (or not planning at all). Since food takes up most of one’s daily needs, it’s vital to be smart about what food is chosen to be incorporated into meals. This doesn’t mean not to be allowed to eat anything cooked by a chef anymore.
Instead, meal prepping suggests people plan their groceries before driving to the grocery mart to know what they need to get. This helps prevent distractions from buying other items that aren’t deemed essential.
After purchasing planned products, it’s good to strategize every so often, to have a clear budget for food. Aside from this being one of the best frugal living tips on the list here, meal prepping leads to a healthier life. One study had shown that those who cooked their own meals consumed less sugar and benefited more from food. To top it all off, cooking meals at home can improve one’s skill in mastering culinary talents.
3. DIY As Much As Possible
One of the most glaring problems in today’s consumer-centered world is the quote, “small and harmless” purchases we rely on. For example, a cup of coffee sounds harmless and cheap. But if one were to purchase the same cup of coffee from a café for an entire year, it then becomes a different story.
Learn how to make some of these things instead of heavily relying on these small purchases. Make a personalized version of them. Skip the fancy cups of caramel macchiato and brew them from home. It’s a surprise to many that the articles or things they “DIY-ed” became more enjoyable over time.
These choices are also seen in day-to-day errands. Going to the laundry shop for one session is cheap. But if repeatedly consistently, a person might miss out on tremendous amounts they could have saved if they washed clothes at home.
So the strategy here is…
- Think and list out things you could DIY potentially.
- Then research online to see if each is possible.
- Then calculate savings over the year to come.
The art of frugally making something out of very small things takes time. Factors like creativity and resources do matter some. Look around and check the purchases that can be made without charging the credit card.
After all, these purchases were advertised to sound perfect and essential. Though in reality, they’re probably not as important as once considered.
4. Buy Secondhand Products
Used or secondhand items are underappreciated and misunderstood. Items that can still serve their purpose for half the price are a good buy. For example, clothes sold in thrift stores just need a few tweaks to look like new pieces of attire.
Another example is electronics like printers, television sets, or laptops. Most of the time people sell these items because they’re planning to upgrade their equipment and not because of things being broken.
Taking advantage of these deals is one of the best frugal living tips anyone can take from this list. Despite release dates or appearances, printers that can still print images are still working devices. Prioritize an item’s function over its specifications and be assured that money will be saved.
5. Don’t Buy What Is Unaffordable
The financial wit this carries is valuable. People shouldn’t purchase items that are unaffordable, nor just because they can afford them. This tip centers on looking at the big picture and considering future costs before buying anything.
The most common example is a newly-released car. Sure, one’s salary may cover the fees to actually get the car. Expensive vehicles are high-powered so they require even more expense. And thus, these cost more in the long run. Over time, these types of purchases become a liability.
This also applies to high-powered equipment like gaming computers with heavy specs. What some forget to consider are future purchases that come in maintaining the condition of some of these things.
The result of buying some things could mean a more costly electricity bill or a terrifying maintenance fee. In the very least, it’s essential to ask if the price tag is really worth the stress of buying something large.
6. Use LED Bulbs
Households operate on light bulbs. Switching to LED bulbs is found to be efficient in reducing electricity costs as they consume less energy. The USA Department of Energy actually confirmed that LED lights use 80% less energy and last 25% longer than their counterparts.
Aside from slashing the electricity bill, LED bulbs are generally better functionality-wise. LED bulbs are also safer in most rooms compared to their counterparts with high mercury content. So, skip the condensed fluorescent light (CFL) bulbs and switch to a better version.
7. Rent, Rent, Rent
Think of what to rent instead of buy. Then act upon the things that make the most sense for your current situation.
One example here is that renting an apartment may be cheaper than purchasing a house. Also it’s a more frugal time-saving practice since it takes away the responsibilities of maintaining a property.
Purchasing a house means dealing with possible depreciation in the long run. Unless one plans to permanently reside with their families, buying an entire housing property might not be the best choice. Though it could be sold one day, thinking of one’s own circumstance is crucial in deciding whether to rent or own.
Renting is not limited to properties. Actually, many services rent out specific things for various needs. Got a photo shoot? Some services can lend an entire professional studio for a day. This could mean that buying some fancy new camera for something that’s needed only for the moment is unnecessary. Services like these also apply to renting vehicles, special attire, party furniture, sound systems, lighting, and many more things.
8. Say No To Debt
It’s common knowledge that debt is the source of almost all financial crises. The best way to avoid debt is by saving as much as possible, as a defense against this problem. Like The 50-30-20 Rule, most inconveniences can be prevented with proper planning and cash allotment.
In cases where incurring a debt seems the only option left, don’t feel too guilty having one. However, make sure to pay the debt as soon as possible. The longer any loan is left unpaid, the more consequential the interest rate impact will be.
9. The “Nothing Left” Principle
Be extremely tight or frugal if necessary.
This applies to every purchase that’s needed regularly. Take shampoos or detergent products as an example. Before hitting the shop mart, check all the bottles and containers to see if there is absolutely nothing left. If there’s still some room left to work with then, there’s still no reason to get another one.
With buying grocery items like shampoos or lotions or many other things, it’s better to buy in bulk. After this, take some smaller containers and place some of the products within them. Add a filler if possible, after online research on feasibility. Sometimes the brain or mindset convinces one to use excessive amounts just because a product’s packaging seems spacious. This tip will help train the brain to only use what is needed.
10. Frugal Leisure Time
Being frugal doesn’t equate to the total deprivation of life’s fun activities. With a few tweaks, anyone can enjoy the luxury of having fun without spending much.
Take one example of movies. Instead of paying for a trip to the cinema, do this activity at home. Dim the lights, turn the TV on, and watch movies that are available for free. After all, the film in the cinema will be available for public viewing after its premiere sometime. So if one is really interested in watching a particular movie, just wait for it to be publicly released.
What about the spa night? Take a sheet mask (this will only cost around $5 or so), play some ambient music, apply nail polish, and voila!
Tired of staying at home to eat? Skip the fancy restaurants and go for a picnic instead. Aside from being the frugal option, it can feel more genuine to just sit and eat packed food with family or peers. After all, it’s not the sophisticated decor that makes restaurant hopping fun. It is the people.
The point is that acquiring the skill of knowing how to live frugally and happy is all about independence. The moment people no longer feel the need to possess something in exchange for happiness or satisfaction is when they witness the beauty of spending less.
11. Expand Cash Flow
More money means more savings. Learning how to be frugal is not just about saving but also expanding one’s cash flow.
Try out different gigs that don’t require much. In fact, some hustles won’t need much of anything external to begin with. These gigs include taking surveys, micro-tasking, online virtual assistant, running some errands, freelancing somehow, being a product influencer, and many more.
Not a fan of online side hustles? Selling old items that are in good condition is another way to generate income without capital. Indeed, the list goes on. Every dollar counts, so whether a small or enormous amount, learn how to value things.
12. Thermostat Settings
The body will adapt to temperature, but money will not adjust to one’s circumstances. As harsh as this may sound, no one actually needs to put their thermostat too low or high.
Get a one time purchase of high quality clothing to get through the summer or winter. This tip will help cut back on electricity bills. Then, it’ll be easier to realize that we don’t really need as many thermostat adjustments as we think we do.
13. Wait For Sales
Anyone practicing a frugal lifestyle knows that sales are everyone’s best friend! Regardless of what area or country, there’s one secret not everyone is aware of. It’s that sales don’t come only during holidays. These deals are available many days but only after checking different stores.
How can one know when to attack the next big payday sale? Newsletters. By subscribing to a store’s newsletter, people can stay tuned to any deal happening within their area. And it’s not just that, as some companies are also known to reward extra credits or discounts to their subscribers.
14. Living Downsize
Through discipline frugality is achieved. Frugal living is paradoxical in a way. One needs to have the mindset of going against the grain.
The bigger the house, the more costly housing debts will be. The newer the phone, the more expensive the upgrade demands will be. And of course, getting that brand new car will require more gas and power fees to cover features. It’s a repeating cycle that makes people poor each day.
The best way to combat this is by downsizing on possessions. Getting that newly released phone is just the same as getting the 2020 or earlier year model. It should work just fine as long as it can send messages, take pictures, and connect to the internet. Focus on the functionality of your purchase rather than its exterior.
15. It’s All In The Mind
Advertisements, powerful language, and consumerism – that’s the battle the brain and pocket needs to resist. However, one can control how the perception of material possessions helps to shape the actions.
Mold the discipline in financial decisions. The point is all the mental pressure related to the urge to purchase non-essential items are illusions of the mind.
Don’t follow the latest trends. The expensive luxury bags hailed “a must-have” back in 2010 are sold for meager prices today. The things we see with online ads and brochures only have value because they are new releases. Give things time to work out, and the celebrity-admired handheld bag today will just be a mere ordinary bag tomorrow.
Don’t invest in materialistic purchases. Instead, choose to spend money wisely to maximize its potential. The $200 spent on an expensive piece of plastic is unwise. However, if we take the same amount and invest it in real estate or index funds, it will continue to flourish over time.
One shouldn’t let the mind dictate how to spend and on what. These mindset concepts can help form the will around the untold secrets of how to live frugally and happy.
Frugality and Happiness: Is It Even Worth It?
Applying the importance of being frugal to our daily lives isn’t as easy as it sounds, especially when done wrong. So, is it even worth the try? The answer is yes. Life is unpredictable. It might feel like we don’t need to conserve cash flow today. One may need it in the future however.
If one is curious how frugality and happiness are connected, this may revolve around the security of having enough income to deal with unknown monetary pressure. When a person is secured financially, they gain a sense of purpose and confidence to live comfortably regardless of what will happen.
Being frugal is also being thoughtful and grateful for every dollar. It teaches a person to find happiness in life’s absolute joys that cannot be purchased nor restocked the next day.
Once a person lives a more secure lifestyle, that individual can feel free and independent. The experience is less stress – doesn’t this sound like happiness?
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