Posted May 28th, 2008 by Penny Wise

I was very flattered recently to be asked to write a chapter for an upcoming book. The author wanted me to talk about what frugality means to me. This isn't the final version but the most personal one. I thought as I have gotten so behind on my blogs lately that I would post it anyway. I don't think it's anything most Simple Savers wouldn't already know, but it's what frugality means to me anyway! :-)

Frugality has undergone a drastic change of image in recent years. Often confused with being 'stingy', frugality has in the past been unfairly stereotyped; usually reserved for senior citizens and those with Scottish ancestry. That's certainly how I used to feel anyway, until becoming frugal changed my life. I didn't even realise it was happening at the time – all I knew was that all of a sudden I was spending a lot less. Which was just as well, because had I not learned how to become smarter with my money, I probably wouldn't be sitting here now, in a home of my own. My marriage may well have also crumbled, along with the roof over my head. Seriously!

When you become frugal, whether consciously or otherwise, you learn how to live within your means. Being frugal means you can be secure in the knowledge that you are doing your very best for yourself and your family, by not throwing money away. Contrary to popular opinion, it is not thrifty people who go without; it is the spendthrifts who go without, because the more they spend on inconsequential things, the more they deprive themselves of what they really want from life. To have cash. To be debt-free. To become home owners. To have happier relationships. All these things are possible when you become frugal because by spending less, you automatically remove much of the stress from your everyday life.

It's common sense really. The easiest way to save money is simply to spend less. But being frugal is not just about spending less. It's about getting more for your money. It's about getting the best value for everything that you buy. It's about keeping your brain in your wallet. So many purchases are made without thinking. A few dollars here, a few there – but those small amounts still add up and can get you in big trouble. When you start learning how to save on all the little things in life, that's when you can start really making a difference to your finances. The best thing about being frugal is that the results are instantaneous. Every time you don't spend money, you automatically gain. How easy is that!

In today's economic environment, learning how to become frugal is the most positive thing you can do to help yourself. Being frugal is not about going without; it's about finding the smartest way to get what you want. I use the five tips below to help me save money every single day, as taught to me by Simple Savings founder Fiona Lippey:

1. Shop around. Always shop around. You can save $300 on a fridge, $50 on bulk meat buys or $30 on takeaway meals. That is money you will no longer have to earn. (Saving is like free money – no one can tax you on it).

2. Everything comes on sale eventually. My favourite mantra! Just wait till the item is half price, then snap it up.

3. Second hand goods are high quality and good value. I save loads buying second hand. Second hand goods have stood the test of time. If it has been used for ten years and is still working, then it stands a chance in your home.

4. Shop smart. Know your prices, know your stores and team up with friends. Ask your friends how they get discounts. I would never have dreamed of asking for a discount years ago. I was too scared of what people might think, being turned down or worse, laughed at. Until I plucked up courage to ask one day and saved $400 on a single purchase. Now I'm a discount diva!

5. Weigh up the pros and cons of everything you buy. I ask myself this every time I'm about to make a purchase. What will you gain from buying this? What will you lose? If you're lucky, all you will lose is the price of the item, but not always. A good example of this is a video game. The kids gain entertainment and will think you're a cool parent but you lose $80 and quality time with your kids. Is it worth it?

For every dollar that you manage to keep safely in your bank account, consider it a personal triumph. Many people have great difficulty separating their wants from their needs but this is where frugal people excel. A NEED is something essential, such as basic food, shelter, clothing and health care. Everything else is a WANT. Learning how to differentiate between the two will have a long lasting effect and make a huge difference to your life. Knowing how to get by on what you need the majority of the time means that you can still afford what you want occasionally, but pay cash for it and enjoy it guilt-free, rather than lying awake worrying how you're going to pay it off. People are too quick to blame their lack of money on rising food and fuel prices and interest rates, when what they should really be doing is taking a good look at all the other rubbish that their money goes on. Food, transport and shelter are all essentials. A new CD or a pink mobile phone with a camera is not!

It's about going back to basics. Frugality makes the best use of long-forgotten skills – waste not want not, make do and mend, just like people did before us; before the invention of 4WD's and takeaway coffees. Another bonus of being frugal is the positive effect it has on the planet – less consumption, less waste. When you know how to grow your own food and cook meals from scratch, you don't lose sleep over rising food prices because you know you can always eat.

With frugality comes security and best of all, happiness. Our parents and grandparents were frugal because they had no choice. We are fortunate in that we do. So choose!

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