Frugality As a Habit

frugalhabitsOne of my new favorite blogs is Impersonal Finance (and not only because he calls himself Mr. Roboto or because his wife and I share a love for the ukulele). I was reading one of his recent posts called The Classics of Personal Finance. Mr. Roboto correctly observes that there is a lot of backlash from personal finance bloggers who say that sometimes we focus on saving money on tiny transactions. We expend time and energy being frugal on items that really don’t move the needle.

He goes on to propose that personal finance may not have a one-size-fits-all solution and that bloggers in diverse economic situations are providing value to people in similar situations to their own. For instance, the blogger writing about debt doesn’t always resonate with the reader who has no debt and is interested in real estate investing. So, maybe looking at the “classic” ways of saving money, including cutting small expenses, isn’t helping.

Seems logical. I agree that personal finance is personal and that we each need to develop our own plan. However, I also believe that people of all income levels, those with both high and low net worths, can benefit from being conscious of purchases, large and small. I decided to write the following comment on Mr. Roboto’s post:

I don’t use my college degree. Literally nothing in my major is directly pertinent in my current job. However, I truly believe that my education taught me lessons outside of the “X’s and O’s”, so to speak. I learned how to work, budget my time, solve complex problems. And I learned how to learn. I built up good habits and those DO help me today.

Sure, there are people for whom a daily Starbucks run won’t move the needle (there are still some for whom it will – as you mentioned, the landscape is diverse), but being conscious of your decisions, building that good habit won’t only affect how you drink your coffee. If you view it the right way, it will affect your entire financial life and outlook.

My education helped me build good habits that lead to a more satisfying life, just like my frugality did.

Sure, having coffee from Starbucks once per day won’t be the habit that makes or breaks you. But imagine if you brewed your own coffee, cooked your own meals, cut cable, reduced your monthly electricity bills, etc. Suddenly, these small expenses add up. Think of all of your small expenses as one big expense, if that helps you. Pile them all together and you will see how important they are.

Plus, the person who is conscious about the small things is RARELY the person who goes out and buys a yacht that he/she can’t afford. Now, I’m not saying that you should never buy anything, but consciously buying the things and experiences that truly make you happy and cutting out the rest, leads to a better life. Don’t go to Starbucks because it’s part of your routine. Go when you know it will really be a treat for you AND you know that it fits within your financial goals.

What do you think? Do you sweat the small stuff?

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21 thoughts on “Frugality As a Habit

  1. Mark Ross March 17, 2014 at 8:29 am

    I do. Every dollar counts. It’s easy to be frugal when you have a certain goal in mind, right?
    Mark Ross recently posted: Book Review: The Millionaire Next DoorMy Profile

    • Mr NYBudget March 17, 2014 at 8:36 am

      Very true – it’s definitely worth always thinking about and knowing WHY you are saving!

  2. Shannon @ Financially Blonde March 17, 2014 at 10:02 am

    I was someone who used to never sweat the small stuff; however, you realize that the small stuff just creates bad habits that only build. I used to think that $5-10 wasn’t anything, but at the same time, if I found $5-10 on the street I would be psyched, so I needed to learn to find it in my bank account. And I agree with you, I have never seen people who count pennies making poor big picture choices, it’s always the opposite.
    Shannon @ Financially Blonde recently posted: Music Mondays – Don’t Fear the ReaperMy Profile

    • Mr NYBudget March 17, 2014 at 10:20 am

      The psychology of personal finance is fascinating. I completely agree that finding $5-$10 is much more thrilling than saving it and losing that amount of money hurts more than not gaining it (not winning a $5 bet, for instance).

  3. Andrew@LivingRichCheaply March 17, 2014 at 11:18 am

    I sweat the small stuff. For those who argue that you should just sweat the big stuff…I sweat that too! But how often does a big financial decision come along…buying a house, a car, etc. Not too often. The small financial decisions occur everyday and if you get into the habit of frugality, it makes a big difference. I think the change in your financial mindset is the first step to building a financially stable life. I also find the psychology of personal finance very interesting.
    Andrew@LivingRichCheaply recently posted: Image is Everything. Isn’t it?My Profile

    • Mr NYBudget March 17, 2014 at 11:48 am

      Sounds as though we are on the same page 🙂

  4. Dee @ Color Me Frugal March 17, 2014 at 12:12 pm

    Great post! I actually wrote a post on this very topic last week, I’ll link to it here. I know too many people who sweat the small stuff but might be wasting money on huge things (elephants!) like expensive cars or a huge house. I think the small things matter, but if you spend your life paying too much attention to the small things while neglecting the big things, you aren’t going to be doing yourself any favors!!
    Dee @ Color Me Frugal recently posted: Don’t Sweat the Lattes, Sweat the Elephants!My Profile

    • Mr NYBudget March 17, 2014 at 12:17 pm

      Nice! Good take from your perspective as well. I guess you can say that this topic is currently trending!

  5. Stefanie @ The Broke and Beautiful Life March 17, 2014 at 1:42 pm

    In my life, the small thing REALLY add up quite fast. My income is barely enough to cover my expenses so any extras have to be budgeted carefully. I’ve cut back on all my little things in the last three months and now I can afford a vacation!
    Stefanie @ The Broke and Beautiful Life recently posted: Breaking Through Your Own Glass CeilingMy Profile

    • Mr NYBudget March 17, 2014 at 2:42 pm

      It’s awesome when you can so clearly see the fruits of your efforts like that!

  6. Mel @ brokeGIRLrich March 17, 2014 at 2:02 pm

    I agree – it’s definitely not a bad lifestyle in general. There’s really nothing to lose by developing an overall frugal outlook on life. Unless you turn into one of the crazies on those TLC shows. Besides, if you’re going to start any habit, you usually start kind of small and build from there.
    Mel @ brokeGIRLrich recently posted: A Day in the Life of an Off-Broadway Production ManagerMy Profile

    • Mr NYBudget March 17, 2014 at 2:42 pm

      Right – there definitely is a line. I guess the best I can do is continue to try to optimize for happiness and hopefully that keeps me frugal without going overboard!

  7. FI Fighter March 18, 2014 at 9:34 pm

    Very well said! I also feel like I didn’t learn much from college, but I did learn how to work… and this did pay off (especially) in the early years of my career.

    I still remember when I started the path to financial freedom. When you are first starting out, the little expenses do matter, and every little bit you save is more that you have to invest with. This is so important when beginning b/c for a lot of people, it’s the early stages that make or break you.

    Over time, when you start generating more passive income, you can ease off the frugal habits a bit, if you’d like… So, there can be a better balance in there somewhere… In my own situation, I don’t track expenses anymore b/c a few bucks here and there don’t move the needle at all, like you mentioned… So, I get to enjoy life more, but I still have the early lessons ingrained… I know I’m not going to do something crazy like buy a yacht…

    Someday, when your passive income trees are throwing off more than you can spend, indulge all you want! There’s nothing written in stone that says you can’t scale up a bit as progress is being made. If you are hitting all your goals, by all means live it up a little. When in doubt, balance is probably the right answer.
    FI Fighter recently posted: Real Estate Investing: Ways to Mitigate Risk in a Rising MarketMy Profile

    • Mr NYBudget March 18, 2014 at 10:10 pm

      It’s definitely a good path to follow – starting out not only being frugal because more money early on is beneficial to you, but because learning good habits early on is worthwhile. And as you loosen the wallet a bit later on, as long as you are still spending on the things that truly make you happy, you are golden. And if you save early, I think you will likely have a better sense of exactly WHAT makes you happy – a better sense of self.

  8. No Nonsense Landlord March 19, 2014 at 6:40 pm

    I don’t sweat the small stuff, but I also have a tendency to avoid things that I do not perceive as a value. I eat out more than I should, but nearly always have a coupon. There are things that save time, and are worth the time savings.

    I have started to bring a lunch to work, to save ~$8, but I buy a pre-packaged burger or similar at a cost of $1.50. To make a sandwich would save a bit, but also cost time. (And I would forget to do it…)

    But I do look for places I can not just save time, but do something I would otherwise pay someone to do. Making keys for my rentals, changing my own oil, doing my own taxes, etc.
    No Nonsense Landlord recently posted: Guest Post: My Rental Strategy And Property ManagementMy Profile

    • Mr NYBudget March 19, 2014 at 11:21 pm

      That makes sense. I definitely enjoy automating processes as much as possible. But I also think there is definitely a value in rolling up your sleeves and cooking for yourself (not only does it save money, it is a much healthier option often as well).

  9. Phil March 20, 2014 at 2:24 am

    It’s all about living within our means and not overspending. Nothing wrong with being frugal. even here in NYC where everything is expensive there are ways to eat cheap and be entertained. Just have to be smart about it.
    Phil recently posted: Malaysian eats in NYC – Malaysia Grill!My Profile

    • Mr NYBudget March 20, 2014 at 7:55 am

      Absolutely – a little bit of thinking/planning goes even further here in NYC than in many other cities!

  10. Ryan @ Impersonal Finance March 26, 2014 at 3:37 pm

    Thanks for the shout out Dave! I’ve definitely grown a lot, both as a human and as a financial being (whatever the hell I mean by that) in the past few years. As such, I likely no longer “have”to watch the small things. Starbucks won’t wreck my budget, I could afford cable, and I don’t need to shop at thrift stores; I CHOOSE to do these things because I know that my financial capital is finite- I don’t have all the money I could ever need or want. Therefore, I have to make decisions regarding the allocation of my scarce resource (money) that have alternative uses. I simply think my money has better uses elsewhere.

    I think you were right on with this: “My education helped me build good habits that lead to a more satisfying life, just like my frugality did.”

    Keep rockin brotherman.
    Ryan @ Impersonal Finance recently posted: recognize your opportunities. then seize them.My Profile

    • Mr NYBudget March 26, 2014 at 5:30 pm

      Absolutely – your post definitely got me thinking (which in my book, makes an awesome post!) – But yeah, it’s all about conscious decisions. If you actively choose to grab Starbucks and are aware how it will affect your long term goals, then power to ya!

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