Those of us who call ourselves frugal have different ways of trying to reach our goal of not spending money foolishly. We have different ideas of what that means and different reasons for choosing to save vs spend money.
The definition of frugal according to Merriam Webster Dictionary is: “careful about spending money or using things when you do not need to : using money or supplies in a very careful way”. For me, being frugal means I don’t spend money foolishly. I plan my large expenditures carefully and save money in advance to pay for them in cash. If I do use credit, I always pay my bills in full each month. I hate to spend money on interest and late fees; it makes me feel squeamish to say the least.
Several years ago, I took a long hard look at my budget and started making changes that have dramatically improved my financial picture and my life.
At that time, I shopped around for auto insurance and saved over $200 annually. When my cell phone plan ended, I bought myself a used iPhone, changed providers, refused to sign a contract and saved $300 per year. I decided I could do without cable and cut the cord so to speak. This saved $660 per year. I did sign up for Netflix so my final savings was more like $480. Bam, just like that I saved $980 per year or almost $5000 in the past 5 years.
I think about auto insurance, cell phone plans and how to watch my favorite television shows about once per year. I make sure I am getting a good bang for my buck and then I think about other things. In terms of choosing wealth, these are some big wins in my book. If you make no other changes to your spending habits, these types of decisions can have a jet-fueled impact on improving your financial health.
Everyday we are faced with making small financial decisions that either increase or decrease our wealth. If we learn to make these decisions easier; staying on the path to wealth is simplified. About the same time I made those big decisions, I figured out how to stop making a small daily decision by deciding once and for all.
I decided I would no longer shop for entertainment, relaxation or because I was bored. I stopped going to stores where I tossed $50 bucks at the cashier every time I walked in the door. For me this included Marshall’s, Kohl’s, and TJ Maxx. I went from going to these stores maybe twice per month to once per year. Translation, I went from spending maybe $1200 per year on stuff like shirts, pants, socks, spring coats to spending $50 bucks. I saved $1150 per year or $5750 over the last 5 years without having to think about it.
I took a small daily decision (should I go shopping today) and made it a big decision. I decided once that I would no longer shop for entertainment, relaxation or because I was bored. Initially, I had to remind myself of my decision every time I drove by a strip mall. I would ask myself “should I stop in see what is on sale?” I would find myself, tossing my groceries in the car and then heading over to Marshall’s next door. Occasionally, I would enter the store and walk around and even try on a pair of pants. But I didn’t pull out my wallet, I didn’t hand over my credit card.
Because I had already made the decision not to shop for entertainment, relaxation or boredom. The answer was no, no way, hell no, nope, not going to do it.
The answer was also because I finally understood WHY I wanted to pursue wealth. WHY I wanted money in the bank and not more stuff in my closet. WHY I wanted to fund my retirement and improve my net worth and not the cable companies profit margin.
At the time, my WHY was because I wanted to take a 2 month leave of absence from work to spend time with Mother Fran at the lake. After that 2 month period, I figured out WHY I would continue to save vs spend my hard-earned wages. I made the decision to quit my job and take 6 months off to spend with Mother Fran at the lake. I decided to move home to the Finger Lakes after living in Massachusetts for almost 25 years. I needed to pay off my car loan, get ahead on my school loan and save enough to live off of for 6 months. In order to be successful, every small decision had to support that BIG decision.
After I moved back to the Finger Lakes and enjoyed my
6 7 month hiatus I figured out my next WHY. Now I am a frugal saver, money conscious 50 something year old gal; because I got a taste of not working a full-time, 9-5 job and I liked it! I really, really liked it. I figured out if I don’t spend it, I don’t have to earn it in the first place. I decided to get completely out of debt and stay that way so that my money would work for me and me alone.
Now I work per diem as an Occupational Therapist every Saturday and whenever I get called for a shift. I have a few side hustles that I enjoy including yard work, helping people do small jobs at home and exercising with a 96-year-old lady. It feels like I am semi-retired although in reality I still earn a living by exchanging my time for money. I just do it on my terms.
This combination of income streams allows me to live a modest lifestyle while funding my retirement. In 2017, it allowed me to buy a car with cash, to cruise to Alaska with my honey and to spend quality time with Mother Fran at the lake and in Florida. It also allows me to be incredibly flexible with my time; which to me is priceless!
Figure out your WHY and start living your dream.