Last updated in December 2020
Did you know that you can both live frugally and be happy? According to the dictionary, the term frugal is defined as “sparing or economical as regards money or food”. But in truth, there is a lot more to it.
When thinking of a frugal person, many people think of a person living in a tent and hugging trees or someone being incredibly stingy and always grumpy with no joy in their life. This could not be further from the truth.
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What frugal living is not
Many people confuse frugal life with being cheap. Being frugal does not mean:
- Living with your parents and not contributing anything despite having a good income (taking advantage of the kindness of others)
- Buying the cheapest gift possible and never donating to charity
- Not repairing/replacing items when needed (e.g. driving a broken car)
- Never buying anything and depriving yourself
- Letting great opportunities pass by because of a small upfront cost
What frugal living is
If I have just destroyed your image of a frugal person, you may wonder what the secret to being frugal is. People that live frugally and are happy have the following characteristics:
- Living independently in a small yet sufficient place
- Gifting their time or DIY gifts and donate when appropriate
- Repairing broken items and replace them when necessary
- Buying items they really need or want but not buying junk (prioritise)
- Knowing when to invest
Being frugal is mainly a lifestyle choice for those that choose not to be victims of consumerism. Other people are frugal out of necessity rather than choice, although it is rare to find people who are struggling to make ends meet mastering the frugal lifestyle.
You often read posts that go like frugal people do this which implies that everyone is the same. Nobody is perfect in real life. Even though I believe myself to be a frugal person, I make money doing matched betting. While matched betting is a great way to improve my bank balance, it can also be classified as taking advantage of others.
It is important to keep in mind that people often cannot be clearly divided into being frugal and being not frugal. While sometimes their lifestyles may be clear cut, frugality is a gradient.
How to live frugally and be happy
1. Stop to be a mindless consumer
The flashy BMW in your garage, that iPhone XYZ, your 95 trousers and 105 handbags. Why did you buy all this stuff? Probably because it looked nice, advertisements told you that you need it or your friends already have two of the same. This is the prime example of mindless consumption.
In the grand scheme of things, a BMW and a Ford are the same: they have four wheels and allow you to drive to places. The same is true for phones, an iPhone does the same as a Motorola. You can make phone calls, download apps and send messages.
If you are a victim of this, do not feel bad about yourself. There is an army of advertisers analysing the difference between their’s and their rival’s product and figuring out how they can brainwash people into believing they absolutely need their product regardless of the price.
I recommend watching The Men who Made us Spend if you want to find out, how well thought out this scheme really is.
Make a conscious effort to live frugally and be happy
To live frugally and be happy, you have to make a conscious decision each time you spend. Ask yourself whether you really need a product or whether you already have something at home that fulfills the same purpose. Even if you do not, you need to be sure that the product you are thinking of buying is truly worth it.
Here is a simple formula you can use as a guide: divide the price of the product by one. If you buy something for £300, the result is 300, unsurprisingly. You can buy the product if you think you will use it at least 300 times. This way you can live frugally and be happy without wasting money.
2. Make the most of what you have
A look into your wardrobes and cupboards, and you will find that there are so many awesome things you already possess. They may not be new and shiny but they fulfill their purposes. Treating each of your possessions with care will reduce the desire to buy new products.
If something breaks, try to repair it instead of replacing it instantly. If it is truly broken, maybe you can re-purpose another item to take its place. Spending some time without your broken possession can also be helpful. If you do not miss an item, chances are you do not need it.
3. Be kind to yourself and others
Being frugal does not mean depriving yourself and hiding in a corner. You can still cook nice meals, enjoy your hobbies and spend time with friends. Many meaningful activities can be done for free such as reading (library), going for a walk, exercising, etc.
Over time, you are likely to make a few bad financial choices. You may fall back into old habits and buy that flashy car. Or become convinced by the media or a friend that you need the new iPhone XYZ. Should this happen, forgive yourself. Analyse why you stumbled and move on.
Giving to others is the same as giving to yourself. Not everyone will give back to you, but over the long-term, giving to others will help you grow. With the help of others, you can achieve so much more than you can alone!
Giving to others includes donating unwanted items or money, gifting time by volunteering, and spending time with your family and friends.
4. To live frugally and be happy, let go of your envy and jealousy
Once you learn to appreciate your own belongings more, you will naturally be less envious and jealous of other people. Thus, you can truly live frugally and be happy. You will understand that others live their own life with entirely different circumstances.
Outer appearances can often be deceiving; people driving expensive cars may have an extensive credit card debt and people that smile at you may have a diagnosis of terminal cancer.
We cannot fully understand another person’s circumstances unless we are very close to them. Therefore, what you might be jealous of is nothing than the outer package. A can of orange juice may be colourful and pretty on the outside but empty on the inside.
Comparing myself to others was a major problem for me for a long time. Once I realised that my circumstances are unique and cannot be compared to anyone, I felt so much pressure lifted from me. It really enabled me to live frugally and happily.
5. Be mindful about your resource use
Simple things like turning off the lights, ensuring the tap is closed, and turning off the heating during Summer can have a huge impact. Being aware of how much energy you waste is the first step to be mindful of your use.
Using reusable items will save you money but also make your life less cluttered. With a minimalist mindset or extreme frugality, you can further save money without compromising your happiness. This will help you to live frugally and be happy.
Think of the environment
Mindful resource use is important to protect the environment. If everyone would stop wasting resources and be mindful, we would live in a better world.
Recently, there has been news on the amount of plastic in the ocean. Everyone feels guilty but nobody wants to change their behaviour, leading to even more feelings of guilt. Not using plastic disposables means there is no need to feel guilty.
To live frugally and be happy, think before you buy one-use products such as plastic bags, paper towels, cotton buds, plastic cutleries, non-reusable earbuds, face masks, etc. There are so many things that you can replace with reusable ones. This will not only protect the environment, but it will also help you to save money.
6. To live frugally and be happy, spend on things that bring you joy
Being frugal does not mean depriving yourself, it means finding happiness with less waste. This means prioritising. If your dream holiday is a trip to Disneyland, then frugality should not stand in the way. But because you are frugal and save money on not buying junk, you are able to turn your dream vacation into reality more easily.
Likewise, being frugal should never stop you from investing in yourself. If you want to advance in your career and need specific certifications or your dream job is to be a lawyer so you need a degree, then it is worth spending.
Usually, your investment will be returned through higher salaries once you finish your course/degree. Even if not, the experiences you have made will help you in later life and the achievement may boost your confidence enabling you to reach higher.
7. Surround yourself with like-minded individuals
If you are surrounded by people who like to buy fancy phones, you are also more likely to buy one. This is human nature. You want to belong to your group of friends and one way to do so is buying what they do.
Being in a community of like-minded individuals can bring you back down to Earth after making such a purchase. It can also inspire you to be more frugal by listening to the right kind of people. Another major benefit is that you can borrow tools or other items from them which will save you a lot of money in the long run.
8. To live frugally and be happy, Practice gratitude
There is always something to be grateful for. Frugal people know that to live frugally and be happy, showing gratitude is essential. And once you look around, you will see that they are right. There are so many things to be grateful for!
You were born onto this planet in the current times, not the Stone Age or in Medieval times. Image how hard life must have been! Here, you do not have to defend against lion attacks every day and you are safe from the plague. You can truly live frugally and be happy.
You were probably also born in, or at least live in, a stable country with plenty of resources. Most of us do not have to go to bed hungry every night or are woken up by soldiers shooting. As you can see, from this point of view, there is a lot to be grateful for.
Be grateful during difficult times
Your ability to be grateful really gets put to the test when you are in trouble. But especially in these times, being grateful can be a powerful motivator and help you to calm down.
For example, let us assume your car just broke down. You could complain and curse your bad luck. Or you could appreciate the fact that you were able to afford a car in the first place. If you look outside, you can see plenty of people walking or riding their bikes even in miserable weather.
Now, not having a car is no excuse to be ungrateful. Perhaps you can be grateful that you live in a situation where you do not need a car. Or that you live in a country where public transport is reasonably reliable and save to use. Finally, you can be grateful that you have legs that enable you to walk to places.
If you are unable to walk and sit in a wheelchair, you can be grateful for the fact that you are able to move around and not bound to your bed. If you are unable to move around, you can be grateful for television and the internet to let you see places you cannot visit.
You probably get the principle by now. If you look hard enough, you will always find something to be grateful for. This is the key to live frugally and be happy.
8. Manage your time mindfully
Time is money, especially for those who want to live frugally and be happy. This does not mean that you have to rush through life and adhere to a tight schedule. Rather, it means that you should value your time as a limited resource. Every second of your life happens only once. What you do with it, is up to you.
To live frugally and be happy, time management is key. You do not want to waste your time with things that do not mean anything to you. For example, going out to please people that mean nothing to you, is a waste of your time.
Instead, you should be generous with your time on things that make you happy. This could be your children, your hobby, or even your job. It is also important to allocate some time to yourself. Take care of your mental health by doing yoga, relaxing, or going for a walk.
10. Be honest with yourself
There is one person I have promised myself to never lie to. That person is me. Before you run away, I am not a pathological liar or anything. But let us face it: We all lie sometimes.
It starts with saying you are okay when you are clearly not and goes on to job interviews when you exaggerate your skills to land that job. At work, you may have had to tell your clients or customers that the project is 100% on plan when you have not even started working on it. Or you told yourself you were fine when, in fact, you were sick.
I am not saying it is okay to tell these lies but it is a fact that sometimes we do not have much of a choice. However, to live frugally and be happy, you have to always be honest with yourself. If you are not okay or do not have confidence in your skills, you can admit it. If not to others then at least to yourself.
How to live frugally and be happy summary
Living frugally and being happy comes naturally to some of us. Others will struggle and have to re-wire their brain to achieve frugality and happiness. However, as long as you try your best, you can improve your life one step at a time. The best ways to live frugally and be happy include:
- Stop being a mindless consumer
- Make the most of what you have
- Be kind to yourself and others
- Let go of your envy and jealousy
- Be mindful about your resource use
- Spend on things that bring you joy
- Surround yourself with like-minded individuals
- Practice gratitude
- Manage your time mindfully
- Be honest with yourself
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