The cost of living for people has long been high. As long as people have enter the working sectors, they are strived and pushed boundaries to meet the costs of living. So bearing the cost of living is not a relatively new concept, but is being noticed is that there is a higher proportion of individuals and families that are entering the circle of debts & loans.
According to a few studies, the costs of living have risen if compared to the times of older generations. For average families, economists have given us a very simple rubric. If we are to compare our living conditions with those of our parents, we will see that our parents used to earn less but save more. Whereas, the salaries today have risen, we earn more than our parents but end up saving even lesser.
Frugality as a debt management tool
Whatever may be the reason, there is a growing trend today to shed light on concepts of “minimalism” and “frugality”. Minimalism is aimed at minimizing or limiting the essential things that are needed to live, mostly consisting of material things. Whereas, frugality can be explained as taking control of your expenses.
Living a frugal life is often associated with living a simple life where unnecessary expenses, luxuries and wants are avoided as much as possible to save more. Frugality doesn’t just mean living a life that costs low. The true meaning of the concept is that you make rational choices when spending on items of daily use, so that more money is left to be saved and more importantly to pay off debts.
When estimating and calculating the average costs, studies have shown “debts” and loans are the most significant costs in the lives of people today. As much as loans are needed to upgrade life and improve the living standards, debts can influence the overall budgets and can increase in burden quickly. Loans and debts often take up the largest proportion of expenses and can cause both emotional and psychological stress to people.
It is difficult to pay off a debt completely, and moreover it is further difficult to avoid taking loans and debts. So the only solution that is noteworthy is to live simpler lives so that more is left, firstly, to spend in which case loans are not needed. Even if loans are taken, then through a frugal life choice it becomes easier for people to pay off these debts quickly.
How to practice frugality in everyday life?
Frugality means spending only on items that are necessary and planning the expenses according to budgets. Below are some useful tips that you can adopt to follow the concepts of frugality and simplicity.
- Housing: Every person desires to live comfortably, have enough space for all the clothes and storage and many people take up home loans at early stages of life. It can be tempting to live in large houses but purchase a larger accommodation only when you have the resources. Till then enjoy your time in the busy city life!
- Transportation: We all have busy lives and a vehicle is the most important investment. You cannot reduce or influence the costs of petrol and gas, however what you can do is reduce the cost of travelling by decreasing the number of vehicles owned by families. When a single car is owned by one family there is a major cut in the costs of insurance, vehicle loan, overtime depreciation and other maintenance costs.
- Groceries: You can save a lot more on the everyday items than you think. Many a times we purchase more food because of our mood or emotions. Without knowing, we end up with more boxes of items that we do not use in our meals daily. The key is to make lists, long and thoughtful lists, before you enter the grocery stores. This way you can differentiate between items that you need and items that you can avoid or do without for the month.
- Sales & discounts: We are not suggesting you to go crazy for every store or retail that is offering sales. No, don’t do that! But do keep an eye on the important seasonal sales. You can purchase in bulk to last if not a year, then at least some months. (But don’t over-purchase. Many people get excited because of discounts and end up purchasing useless items. Amazon Discount Finder Tool is a wonderful solution to finding the latest deals).
- Compare: Window shop! That’s your homework. Visit several stores and outlets for larger and expensive items. Spend your lonely time surfing through shops and take mental notes of items that you can save money on.
- Only Cash: This may sound hard but put your credit card away. Hide it only for emergencies. Recent studies have shown that the psychological affect that handing cash to a salesperson makes the buyers more careful of their expenses. Whereas, credit cards do not leave the same impact.
- Store receipts: Do not throw away the purchase and credit receipts. Mark a certain date of each month where you sit down with your stash of payment receipts. Simple calculations and one look at the amounts can help you determine where you stand financially. The ideal time is somewhere in the middle of the month, this way you can quickly resume control over your spending for the rest of the month.
Frugality as a new era lifestyle choice
Frugality can be practiced in the things and lifestyle ideas that can make life simpler. However, it should be remembered that frugality does not mean that you stop purchasing high quality items and shift onto cheaper options. Frugality simply means that you weigh each product and purchase it only when you really need it.
There are many lifestyle options that even suggest you cut down on socializing to avoid paying for movies, theatre or spend on food. Many believers also discourage from spending on good clothes or furniture.
However, we don’t want you to be too hard on yourself. There is no point in saving for the future if you cannot enjoy your present. We only suggest you to adopt the basics of frugality and you will feel a major difference your spending patterns. Visit Moneysite.com to learn more about managing your money.