What does it mean to live frugally? Like most, I once thought living frugally meant depriving yourself of things. This could not be further from the truth. Living frugally means controlling your finances by forming good daily habits; it is simply about living well while spending less. It is also a tool to reach financial goals. Some may want to get out of debt, save, or plan for a vacation; people want to live frugally for many reasons. The goal may differ for each person, but the frugality principle remains the same: spending less. The prompting to want to change anything usually does not come from statistics. It often comes from having a negative consequence or being tired of hearing ourselves complain.
However, here are some staggering numbers regarding Americans and their finances.
- 80% of Americans have consumer debt
- Americans have $14 Trillion in debt collectively
- The average consumer debt is $38,000, excluding mortgages
- Medical costs have increased 33% in the past 30 years.
- 2 out of 10 Americans use at least 50% of their income to pay back what they owe
- Only 1 in 3 Americans have a written budget
- Almost half of the families in the US live paycheck to paycheck
- 19% of Americans have $0 set aside for an emergency
Our life’s requirements have gradually increased, and many have lost sight of their goals. We have culturally shifted toward luxuries, keeping us in this vicious cycle of working, buying, working more, and upping the ante as we go. If we lower our life’s requirements to the essentials and adopt some practical, frugal habits, we have all the necessary tools to reach our financial goals. As Dave Ramsey says, “Your income is your biggest wealth-building tool.” Make no mistake about it: it is at each person’s discretion what is enough; the chief idea here is staying within budget using the tool of frugality as a means to direct money.
Budgeting is the starting point of any sound financial strategy. Frugality, secondary to budgeting, is a tool that can be used temporarily or adopted as a lifestyle.
Living frugally and gradually implementing frugal habits has opened the door for us to pay off debt, live on one income, increase our savings, invest, and, most importantly, give us deep gratitude for what we have. Getting a pay raise is typically the goal of most, but what is the magic number? Is there a magic number? Or are we chasing after the wind?
Our income changed, and soon after, our money habits changed, too. It was a painful transition, but we quickly realized how content we became with the things we owned. What can we attribute this to? Adopting and implementing frugal habits! These habits that were once used as a tool have become a lifestyle. Frugality has offered us quite a simpler life, something we once longed for and now live out. Henry D. Thoreau, the author of Walden, said, “I did not use tea, coffee, butter, and milk, beef; he had to work hard to pay for them.” This was published in 1854. It may seem extreme today, but those products were considered a luxury.
Habits of Frugal People
After living with the essentials for a few years, it was clear that today’s luxuries were no longer necessary, and we valued time together more. Owning things directly relates to how much we are willing to work for them. Living below our means gave us more time to do the things we love.I have listed some of our frugal habits categorically in terms of how we budget. These are simple, frugal living principles that can help save money. Frugal living is an excellent way to increase pay and start living abundantly.
Home Expenses
- Own one car.
- Have no car payment or work towards the payoff of a car loan. Once the car is paid off, keep the car until the wheels fall off. 😉
- Take good care of your home maintenance (AC system, landscaping, furniture, etc.), allowing it to last longer. Treat it as your own if you’re in a rental; it will pay dividends later if you have built good habits.
- Fix what you can and outsource the rest. YouTube University is a helpful tool for DIY home and car maintenance projects.
- Purchased used quality furniture. Purchasing quality furniture ensures the pieces will last longer, spending less on replacement.
- Mow your lawn.
- Use products to the end, even if you dislike them.
Clothing
- Hang dry clothing – they last longer and save money on energy bills.
- Purchase used quality clothing – they last longer and can be resold more easily.
- Purchase quality clothing and products. They usually have a manufacturing guarantee; if the item does not hold up, it can be exchanged or returned.
- Create a capsule wardrobe – having less clothing costs less.
- Create a capsule wardrobe for your children.
- Pack light; paying for luggage is not necessary. You will likely not need it, but if you do, you can buy it at your destination.
Entertainment
- Dine out occasionally. Opt for a dessert or coffee you get the experience without a hefty bill just for a dessert or coffee.
- Purchase a DVD player and borrow DVDs from the library.
- Free entertainment: Browse antique shops (a fun way to get décor ideas and inspiration) and go to the pool, beach, and library.
- Bowling, miniature golfing, and roller skating do not break the bank; go on discount days.
- Hiking, trails.
- Camping not glamping.
- Grilling at home.
- Puzzles – borrow from the library.
- Reading – borrow books from the library.
- Lean into your hobbies. Be selective about your hobbies.
Health
- Purchase whole-quality foods; everything costs less if you’re healthy.
- Work out at home and avoid memberships.
- Stay active – daily family walks.
- If a doctor visit is needed, use web MD; it costs less.
Food
- Purchase quality food. Avoid processed foods. They cost more and are not necessary.
- Meal plan
- Pack lunches for work.
- Shop sales but only purchase a sale item if it was on your list.
- Keep lists of things you want and need.
- Bulk purchase, sometimes. Bulk purchasing can also be a trap to spend more. Choose items wisely.
- Eat at home.
- Picnics are wonderful.
Personal Cash (non-essentials)
- Closely track nonessential purchases; it will keep you on track and accountable.
- Coffee stops are included here.
- Cut your hair and your kiddo’s hair.
- Wait for sales if you have a large purchase.
- Call the company; they may offer you a promotion.
- Be selective on invitations. Not all invitations are necessary to accept.
- Research before purchasing – getting the best deal or quality for the price.
Extras
- Go back to the drawing board—always keep track of your finances; if something is not working, reevaluate the cost and change it.
- Be a student – keep reading, listening, and learning about finances
- Power of saying no – the power of saying no can go a long way in finances, saying no to invitations that are not important, as well as the gimmicks offered.
- Think long-term when purchasing an item – the things you don’t need will eventually be donated.
- Have a no-spend month; this is a great way to break the habit of overspending.
- Keep budgeting as simple as possible; a notebook works. Grouping rather than having many small sub-categories makes it easier to budget.
- Make your home a place where you want it to be.
The discipline of living frugally is a learned habit and an excellent tool for controlling your finances.