Practice Moderate Frugality

Tip #38 - Practice Moderate Frugality. I think there is such a thing as being too frugal. There are millionaires who never buy themselves a new pair of pants. There are families who have created wealth who refuse to eat out - ever. There are people who try to save money and elimate everything. I don't think this is a wise way to practice frugality.

For those people who are trying to save money, cutting out your daily cup of coffee at your favorite coffee shop is very smart. At up to $3 per cup, you may be spending $90 per month on coffee. But cutting it out all together may mean that you can't keep up with your frugal lifestyle. It may be too much of a drastic change for you. How about becoming moderately frugal? Why not allow yourself a weekly cup of coffee at your coffee shop? Instead of spending $90 per month for your favorite java, you will be spending $12 per month. It's still a big savings, and you can still enjoy what you like. It becomes a treat, though, and not an everyday need.

For families who have already adopted a frugal lifestyle and have saved a lot of money, but still deny everything, I think you are going too far, especially if you have children. I am not one for keeping up with the Joneses, but I do think we can keep up with the Smiths. The Smiths are not overspenders. They don't belong to a country club that they cannot afford. They don't buy the latest designer labels. And they don't have their kids buy school lunches every day. But the Smiths are smart. They make wise financial choices and get good value for their money. They join the affordable swim club. They allow their children to buy one pair of designer jeans per school year. They allow their kids to buy school lunches once a week. They don't always take the cheapest choice, but they don't have to. They have saved and spent wisely in the past. It is okay for them to enjoy some of life's treats. Parents who have some money saved but deny their children from ever buying a school lunch or from ever wearing an expensive article of clothing have set their children up to become exactly opposite of them when they grow up. They may become people who buy everything in sight because they were denied so much as children, even though their parents could afford it.

And as for the millionaires who won't allow themselves to buy a new pair of pants. I say, what are you waiting for? It's okay to live frugally. That's probably how you became a millionaire. But you should live a little, too. Or your inheritors will do it for you.

In Real Life (IRL) - There was a woman I knew in college who was never allowed to eat sweetened cereal or Pop Tarts. Ever. They were denied in her household. It probably had more to do with the nutritional value of the items rather than the cost, but the concept is the same. When she was on her own in college, she went crazy every morning in the cafeteria for breakfast. She ate sugared cereal every day. When they had Pop Tarts, she would eat four at a time. "We were never allowed to eat these at home," she would say. Because she was denied them completely when she was younger, they became forbidden fruit to her and she had to have them when she was allowed to. I think the same thing can happen when you completely deny anything - no t.v., no candy, no designer clothes. I truly believe that being moderate when it comes to frugality is best. Of course, I'm not saying that you should buy your children a $50 pair of jeans if you can't afford to buy groceries. I'm just suggesting that when you cut back your lifestyle you should leave a little wiggle room in there for treats.

I know another family who were very frugal. They were my friend's family. Everything was budgeted out. They had a school clothes budget. Every year, they did their school clothes shopping and only spent the exact amount that was in their budget. If they bought something extra over budget, they had to decide what to return. They carpooled with neighbors to events. The agreement was that the person who drove would provide snack for all of the kids that week. Every other family would stop for ice cream. When it was my friend's family's turn, they would bring in a bag of pretzels for everyone. Ouch. I'm sure my friend was embarrassed. I'm not necessarily advocating that they should have bought the ice cream if they couldn't afford it or if it wasn't in their budget. But this family became known as being very cheap. If they couldn't keep up with the Smiths, then I think they should have gotten out of the carpool situation. Everything this family did was planned, written down, and organized. Play dates always started at 1:00 after lunch. Vacations were always for two weeks via a drive somewhere. Programming of the VCR was always done precisely.

I admire that this family had a budget. I know they lived within their means while still doing fun activities. But they went too far. They had to always be exact. They were never spontaneous. They never gave in. And you know what? When their daughters grew up, they both moved away - far away from their parents. They weren't moderate in their frugality and I think it affected their children.

My mother always said, "Everything in moderation." And I believe when you practice frugality, it applies, too.