Advice is a funny thing you know. When you give it, you feel that you are doing it for the right reasons and can’t see why people shouldn’t listen. When you hear it however, your perspective is completely different and the expectation is that your experience will be different so it really doesn’t apply to you.
With this in mind I fully expect you to disregard most or all of what I’m about to say, which is cool because I like to find things out for myself too, but I’d love it if you did read it through and shared your thoughts in the comments at the end.
An effective view of frugality
To say that I’m extremely wary of people that give financial advice is an understatement, that’s why I rarely do it myself. I’m not about to do it here either, but I do want share my thoughts on frugality because I’m not overly fond of the way many people approach it. Personally I think that there are things you do to save a buck, then there are the weirdos that take it to the next level by washing out ziplock bags and combining their last weeks worth of left overs into a pot an reviving it by adding water and boiling thoroughly.
Don’t get me wrong, I love recycling and left-over dinners are a hotly contested lunch food in my household, but I do think you have to know where to draw the line. To me, being frugal means being economic in a smart way instead of just being cheap, I also think that you need to make allowances for the things you love.
Here are five ways that I think you can live a frugal but immensely enjoyable life.
1. Learn what makes you tick
Temptation is everywhere, there is no avoiding it, but knowing what tips you (and your partner) over the edge is the key to success. Don’t try denying yourself of these things, it won’t work, instead use them as a reward for your success. Build your wants into your budget and make it work for you instead of being a slave to a system that brings you no joy.
2. Know that having something and affording something are two different things
Credit is so available these days that there really aren’t too many things that you can’t have if you really want them. Don’t be fooled into thinking that your very shiny and expensive toy is yours if you bought it on credit, it’s not and it you aren’t careful it will lose it’s lusture very quickly as the thrill of holding it is replaced by the loathing you feel for your new financial burden. Cash is king, buy the things you want with money that is truly yours.
3. Be smart with the money you do have
It’s cool to invest and speculating on stocks or housing can be fun, but don’t do it with all of your money. I personally think that the best investment you can make is in yourself to learn new skills and develop your potential to earn. The other really nice thing to do with your money is to buy a home that you can afford for you and your family and focus on owning it outright as soon as possible. This is a highly underrated goal and one that even I have only come to realise in recent times. Make sure you also use loans effectively to keep your money working hard for you even when you aren’t using it, offset and high interest accounts can make a big difference over time.
4. Haggle in all situations
Here is a piece of trivia for you, I spent a year of my life as a child living in Bali, Indonesia. It was a great experience and as a result I have a strong desire to haggle (or barter) over just about any transaction I make. This is generally where I feel you can make a difference, everyone loves a better price or an added bonus thrown into the deal, most just don’t ask for it. If you aren’t much of a haggler, I seriously recommend you give it a go, I think you might be surprised how far it can get you and where you can use it (hint: there are very few places you can’t).
5. Understand that money and objects should not be associated with love
Society today places a huge emphasis on the value or size of things and as a parent I have a desire to give my children all that they want, but financial expense has no correlation with love. This applies to all relationships, but it isn’t a “get out of jail free card” the next time your wedding anniversary rolls around. Love is easily expressed by effort applied, time or attention given, encouragement or thoughtfulness. Buying lavish gifts is a lazy way to display your affection, look for more meaningful alternatives before spending money blindly.
I’d really love to hear your thoughts on these points, so please leave a comment and tell me what you do and don’t agree with.
Image by Tax Credits