Finance Tips: What Is Frugal Living?

Learn how to live a frugal life and live within your means with these tips, suggestions and ideas for how to budget your money.

When people hear the words "frugal living," visions of dumpster diving and recycled dryer lint tend to come to mind. This couldn't be farther from the truth. Simply put, to live frugally is to spend wisely. This means living within, or below, one's means.

Frugal living isn't about giving up the good life; it's cutting out unnecessary expenditures. Most families who practice frugal living do so, not because they're in a financial bind, but because they've made a conscious decision to take control of their spending and that means not keeping up with the Joneses or maxing out credit cards.

It's important to understand that living frugally isn't about being deprived. It's about making a conscious effort to save money. In fact, a frugal lifestyle might be considered by some as living the good life. Why? Because frugal folks know where their priorities lie and they reap the benefits. They eat fresh, home baked cookies and breads rather than purchase store bought goodies in expensive packaging. Just about every item in their homes is paid off, which means no credit card debt, high interest rates or fears of repossession. Frugal families are aware of every penny they spend and have been able to cut out wasteful items such as convenience products and frequent fast food dinners.

Living frugally also means knowing you get what you pay for. If a frugal person is purchasing an appliance or other major item, he or she does the research first to find out which brand is the best deal for the money. Sometimes, it pays to spend more money on an item that will last, than to buy a cheaper item that breaks down often, constantly needing costly repairs. A frugal person, however, would never pay full price for a big-ticket item and will instead look for a sale or a good deal on secondhand merchandise. This same frugal person might also know how to purchase a cheaper model because it was a display item or has a dent in the side.

A frugal person visits flea markets, thrift shops, consignment shops and garage sales to find bargains for the entire family. In many cases, the items are in excellent condition; they just need a little cleaning or mending.

To some, living frugally is an enjoyable challenge to see how much money can be saved each month. Many families not only accumulate a tidy little nest egg, but also manage to save money for vacations, new cars and other expensive luxuries.



What are the ways one can practice frugal living? It's not as difficult as you think.

The first course of action would be to make a list of all expenses. This means carrying a small notebook with you in order to jot down small expenditures like coffee and bagels in the morning or periodic trips to the snack machine. At the end of each week and each month, go over your expenditures and see which items you can do without or, at least, substitute for a cheaper version. For instance, instead of purchasing a four-dollar cup of coffee at the gourmet coffee shop every morning, why not fill a thermos with coffee from home? Instead of purchasing your lunch every day, why not pack your own home cooked lunch? Would it cost less for you to subscribe to the daily newspaper than to pick it up every morning at the newsstand? Is it necessary to pay for premium cable channels with movies you may watch only once a month, or is it more cost efficient to go with the basic package? Do you really need to make weekly visits to the movie rental emporium, or will it save more money if you use the library? There are many ways to save when you put your mind to it.

You'll also want to tackle your grocery bill since this is where we tend to spend the most money on frivolous items. The key is to buy only items you need, stock up when they are on sale, and use coupons and rebates. Avoid expensive convenience and impulse items since this is where the most money is wasted. Instead of purchasing boxes of pancake mix and mashed potatoes, make them from scratch. Not only are they cheaper, but they also taste better. Don't pay full price for anything. If you have coupons for those items, that's even more of a savings. Make up a price book - a notebook that lists retail as well as sale prices on items you regularly buy. When you shop, consult your price book. You'll be able to tell if you should buy the item then and there, or wait until it's on sale when you know you'll get a better deal. Never stray from your shopping list either. It's those impulse items that add up. Make it into a game each week and see if you can save more money than the week before. Once you see how much you're saving, you'll never want to pay full price for an item again.

If you're truly interested in adopting a frugal lifestyle, you'll want to avoid convenience spending. Eliminate weekly trips to the fast food restaurant or pizza place and leave microwaveable dinners off of your shopping list. You may think you don't have time to make dinner every night from scratch, but all it takes is a little schedule shuffling. For instance, why not cook your meals ahead of time and keep them in the freezer? To take one or two days each month to do this will not only save money, it will free up your time as well. Instead of driving back and forth to hurried fast food dinners, you'll be having a delicious home-cooked meal in the comfort of your own home.

Once you adopt a frugal lifestyle, you'll find other ways to cut out wasteful spending. Expensive cleaning products will be a thing of the past, as will weekly excursions to the mall. You'll learn that you can save money on holiday decorations by purchasing those items during after-holiday sales, and you'll keep an eye on sales flyers to purchase birthday and holiday gifts ahead of time. That way, you won't need to make a hurried trip to the department store to buy an expensive impulse item at full price.

After a few months of prioritizing and accounting for every penny, you'll be sure to notice a major change in your bank account - a change for the better that is. The best part is that by re-evaluating your lifestyle, you're sure to learn about those things that are really important. Chances are they have nothing to do with money.

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