Let me start by saying this could probably be the most unliked topic when people talk about living a frugal lifestyle. It is not an easy feat to do and most, if not all, feels uncomfortable doing this. Thrifty living is not high up on the list of priorities for people nowadays.
Age of high consumerism
We live in a time, now more than ever in the history of mankind, where high consumerism or consumption is actually celebrated and admired by the majority. If we think about this for a moment and perhaps even do a personal evaluation.
What do you feel when you purchase a brand new, top of the line, and the most latest mobile phone. Let’s say the latest Apple iPhone or the most powerful Samsung Galaxy S10 phone. (Yeah, yeah, I know I just made that up. The Samsung Galaxy S10 doesn’t exist yet at the time of this writing but I’m sure Samsung will eventually manufacture it sometime in the near future.)
Perhaps think about what you would feel when you purchase these items:
- a brand new smart watch or even a luxury watch from a well-known brand
- how about a 3 carat diamond eternity ring
- let’s go even further, a brand new red sports car
- or perhaps a tad bit higher a newly built 5 bedroom single detached home
I myself (and I’m sure my wife as well) would feel some sense of pride and satisfaction. I’m sure you will too, wouldn’t you? Majority of us would feel some sense of happiness for the purchase that we’ve made. Let me pose this question to you and would you kindly comment your answers below. What is that one thing that you aspire to have some day? Or perhaps you’re already working hard right now in order to achieve or purchase it?
Social Media celebrates high consumerism
How about let’s look at social media sites. What is it that we see majority of the people posting online? If someone buys a new car, a new gadget, a new watch, more often than not they will take a picture of it and post it proudly in social media. And then what happens next? People will start liking that post and even sharing them. Also, it is very likely that people will commend and congratulate them for the said purchase. This is the norm or the common trend these days.
I’m not saying that this is bad, but the question I have is, is it the best way to live?
I would bet, if there is any such study that even exist, that very few people ever aspire to living a frugal lifestyle. It is not something that most people really want. I wonder who among us are actually dreaming of living a simple frugal life?
Chasing for the next best thing
Now give it a few months and likely a newer model or version of that thing that you just purchased comes out. Think about this for a second. How would you feel? More likely you’ll start wanting to get the newer model, wouldn’t you? Sometimes it may even make us feel incomplete when we don’t have the newest or the shiniest of these material things.
I think humanity has this sense within ourselves of trying to acquire the best and the brightest. We want to always have the next best thing. We can even say that it is a form of addiction. This is why we keep purchasing the latest new cellphone that comes out. Or after a couple of years, we trade in our still fully functioning vehicle, that we by the way purchased as new, for the latest model.
This is a vicious cycle. The society that we live in and the culture even promotes this way of life. There seems to be a whole in our hearts that we keep trying to fill in with the newest of stuff.
Unfortunately this is not a healthy lifestyle. It is unhealthy physically, emotionally, financially and I dare say spiritually.
Living a frugal lifestyle
I find it quite interesting that our culture and most of our societies no longer promote this way of life. You won’t find people celebrating their frugality. I would even dare say, that probably majority of those who are living a frugal lifestyle are probably forced due to their circumstances or social status within their community. It’s not a conscious and willing choice for the majority.
But what if I tell you that living a frugal lifestyle is actually a far better way to live, would you agree?
Let me prove it to you.
Contentment is the key
Thrifty living can actually benefit you and your entire family if you think about it in the long term. Being contented with the “just enough” stuff that we have in life. Realizing that buying only those that we can afford and perhaps those cheaper brands can help our financial baseline.
We don’t need fancy clothes or thousand-dollar suits just to make us feel proud and happy. Learning to accept the simple things in life really would help you live a fuller happier life. Why do I and how can I say this?
As we all know, about 95% of the world’s population can be defined as the “not rich” people. A lot are even living under poverty. There’s only very few people in this world that are really really rich or for lack of a better word “filthy rich”. However, isn’t it quite interesting that most of us who are “not rich” aspire for the things that only the rich can afford to buy? Sometimes some people even become obsessed that could lead to depression in trying to pursue after these luxurious things.
That is a sad way to live your life.
Better way to live
If your spending habits are consciously within your income or far below your income that would actually leave more room for some excess money. There’s even a financial strategy where you pay yourself first and live off of what’s left. More often than not, it’s the reverse that’s happening. We spend our money and save whatever is left of it, if we’re even lucky that some would be left. Coz often times with this approach nothing gets left over.
What’s my point, why am I after having some excess money? These excess money that you keep are not intended for you to eventually spend it some time in the future for that luxury item that you dream of. Well not really quite yet.
Build your passive income
I suggest that you use this excess money to invest it in building your passive income. Build a plethora of income generating vehicles that would put more money in your pocket.
- You can invest them in stocks or mutual funds or ETF’s
- or put it in rental property (especially when you’ve grown your wealth to a sizable amount)
- start or build a business; some online businesses are easy and are pretty inexpensive to start; check out this amazing deal from Wealthy Affiliate here if you’re considering starting an online business
The point is make your excess money to work for you. Living a frugal lifestyle is basically your means to an end to building your wealth.
There is actually a comprehensive study done about the wealthy people in the United States. According to the study of these millionaires, it was actually found that majority of them are not really high spenders. Rather, they are living a frugal lifestyle and are very thrifty.
Millionaire Next Door
This book, “Millionaire Next Door” is the study that I am talking about. Authors Thomas J. Stanley and William D. Danko has surveyed hundreds if not thousands of millionaires in over two decades. Their findings were quite a surprise when they realized that these affluent or wealthy people are really not the high spenders we thought or expect they were.
Here are some common denominators that they’ve found:
- Majority does not spend over a thousand dollars, actually a lot less, on their suits
- Most of them do not purchase brand new nor even enter into a lease for a vehicle
- A great deal of them has purchased their residential property and have lived in them for decades
- At minimum 15% of their realized income are put into their passive investments
- Majority of these affluent have their own business
- They are mostly first generation self-made millionaires
As you can see, these people are living a simple frugal life. They don’t buy the next best or shiniest thing that comes out in the market. We can even say that they have found satisfaction in the simple things in life. And they get their joys out of making wealth or growing their business. They are hard-working people who make the most out of their income.
I encourage you to read this book. You can get this from Amazon here.
There’s a ton of wisdom to be learned from the affluent people. I’ve only touched the surface of the research that was done that was written in this book Millionaire Next Door. If you’re serious in wanting to get out of the rat race. If you have a strong desire to become financially free and not live from paycheck to paycheck. Then I strongly recommend getting this book.
Tips on living frugally
Now all I’ve said here so far would be a waste if I would not give you some tips on thrifty living. I have compiled an extensive list in here. I’m not saying to do all of them but I suggest try your best to practice most of them.
Then at the end of the day, any excess money that you save can be put into passive generating incomes. Or perhaps as earlier mentioned, make it a point to set aside your budget for building passive wealth first, then live off of the rest. And then if you still end up with excess money, then top it up to your wealth building account or business or project.
17 Ways to living a frugal lifestyle
- Plan your budget – as the saying goes if you fail to plan then you’re planning to fail.
- Stick to your plan with your groceries or meals. Try your best not to bend or deviate from it.
- Use coupons and take advantage of discounts you can get from grocery stores and/or merchants.
- Shop wisely and utilize price matching. Essentially this involves finding out discount or lower prices from other stores.
- Drastically lessen the number of times that you eat out at restaurants or fast foods.
- Cutting your coffee routine with Starbucks or Blenz or McDonalds or wherever else you get your daily coffee. Home brew your own or get one of the instant coffee ones.
- Buy in wholesale groceries or stores like Costco or Wholesale Club.
- Practice and schedule scavenger hunt for food in your fridge or kitchen when you think you’ve got no food left. Often times you’ll be surprised there’s some more left hidden somewhere.
- Cook big batches and just separate it out in portions then freeze them. You’ll only need heat it up when it’s time to eat them.
Cars / Vehicles
- If purchasing a vehicle, buy a quality used one instead of brand new or leasing.
- Take public transit when commuting to work. This can save you from consuming fuel with your vehicle especially with the rising gas prices these days.
- When purchasing a home never maximize your pre-approved mortgage but rather decide what you’re comfortable paying monthly then go from there.
- Save on energy. Be conscious with your energy consumption. Try to save by turning off lights in areas where there’s nobody there. Turn off or unplug appliances that are not in use.
- Cut your cable TV. Nowadays you can find a lot of online-based or streaming media for a lot less than what you pay to your Cable TV provider.
- Use Ebates.ca (if you’re from Canada) when shopping online so you get rebates with your purchases.
- Find a better/lower mobile phone plan.
- Practice fasting, it’s actually good for your health. You can make this as a routine and do this once every other week.
There you go. These are some ways to cut on your expenses. If you have other tips please do comment below I’d love to hear about them.
You can start with just one or two or even a handful. Then work your way until about two months and you’ll notice that it will become a habit. From there you can add another one from the list.
All of this should be done with the ultimate goal in mind of saving some cash and utilize it to build your passive income or wealth.
Final thoughts, obviously there are some other ways to add to your income whether it’s done actively or passively. However, I will talk about that in another blog as those are geared more towards generating wealth rather than thrifty living.
So in closing let me know your thoughts. Just to reiterate the questions I’ve asked here, what’s that one thing that you’re dying to buy the most? And secondly, if you have any other tips and ideas in living a simple frugal life, please do comment them below.
Have a wonderfully blessed and satisfied life!
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