“Frugal” is not a dirty word

My wife and I were talking recently about a June 5, 2015, New York Times article that described the lifestyle of “Millionaires Who Are Frugal When They Don’t Have to Be.” It got me thinking about the word “frugal.” It will probably never be a sexy concept, but neither does it have to seem like a dirty word.

The title of the article seems to conjure a slightly pejorative image — people who are well off but needlessly pinch pennies. The actual content of the article is more favorable. It focuses on people who have settled into a particular niche — the Times describes them as single-digit millionaires. It’s an interesting position. Obviously, they are very well off, but they are not crazy rich enough to afford every extravagance that crosses their minds. Also, people in this position often made their money themselves, so they can remember what it was like to get by with less.

None of the lifestyles described will ever be fodder for a reality show — not only aren’t these people splashy enough spenders, but they seem more focused on living their lives than on demonstrating their wealth to the rest of the world. Still, while I can see the article’s point about frugality, what struck me is that each of the people profiled had some form of indulgence, whether it is an extra piece of property or the occasional trip to Italy.

In other words, these people are not making themselves miserable by living a monk-like existence when they could afford more. They are enjoying their wealth even while being very conscious of not blowing it.

Enjoying a frugal lifestyle

Of course, the people in the article are far from typical. Even a single-digit millionaire has been far more fortunate than the average American. Still, I think there are some lessons in the lifestyles described that show how frugality does not have to mean miserable self-denial.

Here are some thoughts on how to leave room for joy in a frugal lifestyle:

  1. Budget for some discretionary spending. Living within a budget requires having the discipline not to exceed that budget, but it does not have to mean every expenditure is specifically planned or even logical. Whether it is $50 or $50, 000, leave yourself a some room in your annual budget to spend impulsively, indulgently, or however you see fit. That way, you will get to feel a sense of financial freedom, while also knowing that you are staying within the framework of your budget.
  2. Own up to your splurging. The worst over-spenders I know always have a rationalization every time they splurge on an unnecessary expense. This translates into a sense of denial which prevents them from recognizing how often they do it. Be realistic. It’s OK to splurge occasionally, but recognize it so it does not become a thoughtless habit.
  3. Make the big decisions count. No offense to one of the guys described in the article, but you can darn your socks all you want, it will still be the big financial decisions that matter. What did you pay for your home, and what mortgage rate did you get? Did you strike a hard bargain on your last car? There are a handful of big decisions that have real big-money impact.
  4. Enjoy the little things. Building a 25, 000 square foot palace can drain even a millionaire’s finances, but buying a little better bottle of wine or a weekend getaway are smaller indulgences that shouldn’t leave a lasting mark. If you learn to enjoy little rather than big indulgences, you can enjoy your money without overspending.
  5. Maintain some form of income. Take it from someone who is in his second career — it feels great to downshift without completely slamming on the brakes. I enjoy working, and even with some money saved there is nothing more reassuring than seeing some income continue to roll in.
  6. Get on the same page as the rest of your household. The wealthy couples described in the article all seem to share a philosophy toward money with their spouses, and this is very important to being able to be happy with a modest lifestyle. If you want to drive around in a seven-year-old Toyota while your spouse wants to live like a Kardashian, neither one of you is going to be very happy.
  7. Keep positive goals in mind. Don’t focus on the denial aspect of financial responsibility; focus on the positive aspects of it instead, such as a brighter future and a stronger sense of control over your life. View financial responsibility as an act of empowerment, not one of denial.

The people profiled in the Times article are living such good lifestyles that I probably would not even have used the word “frugal” in the title. To me, it just seems sensible; but that probably says something about my overall mindset, not to mention why my wife showed me the article in the first place….

9 Responses to ““Frugal” is not a dirty word”

  1. Anonymous

    I also think It is the right word not a dirty one. I like your article very well. your descriptions were awesome I love to enjoy with little things. Thank you for your great tips.

  2. Anonymous

    Excellent article Richard. I enjoyed your thoughts on the line between sensible and frugal. Is it all relative?

    Frugal is definitely not sexy, but I think it’s becoming more commonplace today than it has been in the past.

    Now we have things like minimalism coming into play, so maybe frugal is becoming the middle ground.

    Enjoyed the article.

    Laura Beth

  3. Anonymous

    I agree that frugal is NOT a dirty word! It has such a negative connotation that it’s no surprise that most people are struggling financially. Frugality is actually a lifestyle of freedom. I talked about that in a post on my blog called “The Benefits of Living Frugally”

  4. Anonymous

    I love ‘Frugal’ but yea in the common parlance it is treated like a dirty word. I completely agree with you that frugality is not about denying oneself the joy that money can offer. Its only about sensible financial management.

    When people start darning their socks 🙂 it does make frugal sound like a little stupid. But getting better deals on loans and enjoying the small things in life are something every sensible individual should do.

    Being a millionaire is not all about earning only. Saving is also important. 80/20 rule of spending and saving is a must for every person looking to have a secure financial future.

  5. Anonymous

    Yes I agree that ‘frugal’ is not that bad of a word, even if it’s applied for the rich or not. Thanks for the nice article!

  6. Anonymous

    I wholeheartedly agree. Unfortunately, “frugal” is a very unfashionable word nowadays. For the wrong reasons.

    It is actually derived from the Latin “frux”, meaning fruit or virtue; and “frui”, meaning to enjoy or use well. Therefore, frugality does not actually mean going without; instead it means enjoying what you have!

    For me “frugal” simply means having a high “joy-to-stuff-ratio”, getting the maximum enjoyment out of resources.

    And who wouldn’t like that?

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