For a lot of people, frugality is a nine letter word for cheap. They think of people doing stuff like buying cartloads of generic products, using forty coupons in the checkout aisle, wearing patched clothing, driving a rusted-out old vehicle, and other such things that itʼs easy to look down your nose at.
Hereʼs a secret, something that I’ve witnessed several times in my own life and read about many more: those frugal people that you look down your nose at often have a mountain of cash in the bank (not always, of course, but more often than you think). Theyʼre not drowning in a mortgage, theyʼre not making payments on a five figure credit card debt. Theyʼre not working to death on the weekends or drowning an ulcer in Pepto-Bismol. Theyʼre living their life according to their own rules.
The best part is that we can all apply some of those same rules in our own life. Hereʼs what you can do to start reducing that spending.
Maximize Every Dollar
Every time you spend money, you make a decision. You decide that whatever youʼre giving that dollar for is worth it, and thus you make the exchange. The real key to spending less is to raise that definition of what a dollar is worth.
Here are 100 great tactics for reducing your spending and saving more money.
- Switch your bank accounts to a bank that respects you. You shouldnʼt be spending your hard-earned money on maintenance fees – you also should be earning some serious interest on your checking and savings accounts. I use ING Direct as my primary bank – I earn roughly 1% on my checking account and 1.4% on my savings account (even in this down economy) and theyʼve never dinged me with a fee. Itʼs not too hard to switch banks, either, if you sit down and just do it.
- Turn off the television. One big way to save money is to watch less television. There are a lot of financial benefits to this: less exposure to guilt inducing ads, more time to focus on other things in life, less electrical use, and so on. Itʼs great to unwind in the evening, but seek another hobby to do that.
- Turn a critical eye to your “collections.” Most people collect something – what do you collect? Is it something that consistently brings you joy? Or is it something that you just do out of habit at this point? Does the collection itself have value? Could you perhaps “trim the fat” from this collection by getting rid of duplicates or getting rid of the items you no longer use? Also, could you perhaps cut down on your spending on that hobby? Focus on trimming the things you donʼt feel strongly about – if you dig into things that bother you, youʼre going to eventually relapse.
- Sign up for every free customer rewards program you can. Even if you rarely shop at that place, having a rewards card for that place will eventually net you some coupons and discounts. Hereʼs the basic game plan for maximizing these programs create a Gmail address just for these mailings, collect every card you can, and then check that account for extra coupons whenever youʼre ready to shop.
- Make your own gifts instead of buying stuff from the store. You can make food mixes, candles, bread, cookies, soap, and all kinds of other things at home quite easily and inexpensively. These make spectacular gifts for others because they involve your homemade touch, plus quite often theyʼre consumable, meaning they donʼt wind up filling someoneʼs closet with junk. Even better – include a personal handwritten note with the gift. This will make it even more special than anything you could possibly buy down at the mall, plus it saves you money.
- Master the thirty day rule. Whenever youʼre considering making an unnecessary purchase, wait thirty days and then ask yourself if you still want that item. Quite often, youʼll find that the urge to buy has passed and youʼll have saved yourself some money by simply waiting. If you want, you can even keep a “thirty day list” where you write down the item and the day youʼll reconsider it, but I prefer just to keep this one in my head – that way, I often just forget about the unimportant things.
- Write a list before you go shopping – and stick to it. One should never go into a store without a strong idea of what one will be buying while in there. Make a careful plan of what youʼll buy before you go, then stick strictly to that list when you go to the store. Donʼt put anything in the cart thatʼs not on the list, no matter how tempting, and youʼll come out of the store saving a bundle.
- Invite friends over instead of going out. Almost every activity at home is less expensive than going out. Invite some friends over and have a cookout or a potluck meal, then play some cards and have a few drinks. Everyone will have fun, the cost will be low, and the others will likely reciprocate not long afterwards.
- Instead of throwing out some damaged clothing, repair it instead. Donʼt toss out a shirt because of a broken button – sew a new one on with some closely-matched thread. Donʼt toss out pants because of a hole in them – put in a patch of some sort and save them for times when youʼre working around the house. Simple sewing can be done by anyone – it just takes a few minutes and it saves a lot of money by keeping you from buying new clothes when you donʼt really need to.
- Donʼt spend big money entertaining your children. Most children, especially young ones, can be entertained very cheaply. Buy them an end roll of newspaper from your local paper and let their creativity run wild. Make a game out of ordinary stuff around the house, like tossing pennies into a jar, even. Collect common household items into a “rainy day” art box. Realize that what your children want most of all is your time, not your stuff, and youʼll find money in your pocket and joy in your heart.
Part 2 of Frugal next time.
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This is part of a series of posts begun July 15, 2015 – The Simple Formula for Creating Wealth.
Learn how to manage your money, eliminate debt and build wealth in my book, Your Financial Success.Wishing you well,
Daniel R. Murphy
Educating people for building wealth, adapting to a changing future and personal development.