When you hear the phrase “frugal living,” what springs to mind first?
Are you thinking about a saving maven who’s always pinching pennies? Or do you think of the person with the impressive portfolio that’s setting themselves up for either a lucrative financial future or one that will go down in flames? There is some rhyme and reason to what makes a frugal life worth living—here are the four key pillars of the frugal mindset and why they’re so important.
Budget Above All Else
No one can experience financial freedom without budgeting: full stop. Without a budget, your money is likely to disappear into places unknown and never fully realize its potential. Start by tracking your income and expenses. There are countless apps out there that can help, or you can go old-school with a spreadsheet or even pen and paper.
Once you have a clear picture of where your money is going, categorize your spending and set limits for each category. Good budgeters also know money isn’t about limiting your spending—it’s about controlling where it goes. Some of the best budgeters also make room for entertainment, going out to dinner, hobbies, and so much else. They just keep track of those expenditures so they don’t go overboard.
Think Before You Buy
Acting on impulse is one of the fastest ways to destroy your bank account. You know the drill: you walk into a store for one item and leave with a cart full of stuff you didn’t even know you needed, probably because you didn’t. Frugal individuals know that smart purchases are rarely made on impulse or emotion—they require thought and logic.
Waiting before you buy something, usually a day or so before particularly large purchases, gives you time to discover whether or not you really need it. It also allows you to ask yourself why you’re buying it, if there are cheaper alternatives, or if it’s something you can really afford at this moment, even if it would improve your quality of life in the short-term.
Fun Is Often Free
Just because you’re living frugally doesn’t mean you have to miss out on fun experiences. In fact, frugal people know that some of the best activities are completely free! Think about how many beautiful moments you’ve had with family or friends that didn’t cost a dime—those are always available to you!
Even if you’re not going completely free, frugal living is all about how to reduce spending without compromising on fun. So instead of going to an expensive beachside bar on vacation, you might opt to pack a picnic with a bottle of wine and watch the sunset on the beach instead. They’re both great experiences, but one is significantly less expensive than the other.
Make It Yourself
People hear a lot about DIY’ing and how difficult or time-consuming it can be. That can be true; there are many things that are best left up to experts, and taking matters in your own hands can cost you even more money than hiring a professional. But that doesn’t include the massive amount of tasks that are actually quite simple and cheap to do by yourself.
We recommend starting small and seeing what comes of it if you’re not a handy person. Even if this just means making more meals at home, it’s still a big win for your pocketbook. You’ll be amazed at how much you can save by doing things yourself, and you might even discover a hidden talent along the way.
