Developing a Frugal Mindset

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Ever wonder why it is that some people can seemingly live so well on an extremely small income and others – who make a lot more money – struggle to just get by? A lot of the reason is in the way people think about money.

Regardless of how much money you make, frugal living requires a frugal and thrifty mindset. It requires you to evaluate, or possibly reevaluate, how you think about a variety of things such as the way you view money, your level of materialism, or your attitude toward consumerism. Consider for a minute what your core values regarding money and frugality are.

• Do you buy spend your paycheck on what you want then sometimes find you don’t have money to pay the bills?

• Do you think it degrading in some way to buy used merchandise, i.e., someone else’s “junk”?

• Do you insist on buying only brand name merchandise thinking that generic is in some way inferior?

• Do you feel that you and your family deserve the good things in life whether you can legitimately afford them or not?

Don’t get me wrong! This is certainly not said to condemn. It’s just that when money is tight or when financial hardship strikes, we may have develop a more frugal mindset in order to simply survive. Sadly, not everyone knows how to do that.

Maybe you feel the need to save money now in the current economic situation even though you’ve never had to worry about it before. Or maybe you see changes coming that will soon require you to be more frugal. Whatever your individual circumstances, you may simply feel the need to become more concerned about how much money you spend and what you spend it on.

If that’s your case, here are three simple things that may help you to begin changing your attitude toward money and frugal living in general.

1. Look at money as a tool, rather than a status symbol. While there are many people who might disagree, money is truly designed to be used to acquire what you and your family need and want. Period. While it can be used to help you appear prominent and it may gain you a measure of status and respect, the underlying truth is that money is a tool to help you create a comfortable life for your family.

If you have enough money to create a luxurious lifestyle, that’s all well and good. But if you don’t, then for your sanity’s sake and for your personal survival, you’ll have to learn to adapt your thinking and make your lifestyle the best it can be with the money you have available.

That doesn’t mean you’ve somehow failed, or that you should be less content with what you have right now. It only means that you have to work to save and earn the money needed to create the lifestyle you want. And until that time, living frugally will help you live the best you can with what you do have.

There is no shame in not possessing everything you want, or even everything you need. Learning to manage your money and your attitude toward it will only help in the long run.

2. Realize that to manage your money properly, you must first spend it on the things you need, and then – if there is any left over – you can spend it on the things you want. A lot of people get in trouble when they reverse the order of this basic money management principle. They want what they want, so they spend their money on their desires then have nothing left with which to buy food or pay rent.

You must learn to discipline your spending so that your family’s needs are provided for first. Sometimes the only way to do that and have anything left over for the “extras” you desire is to live more frugally than you’re used to doing.

3. Learn to distinguish between a want and a need. Once you realize that you must provide for your family’s needs first, you must then decide what constitutes a need rather than simply a desire. Need are things we can’t live without such as food, water, clothing, shelter, transportation so we can work to provide for our needs. Wants are all the extras – even if they feel like needs!

Junk food, cable TV, movie rentals, new or brand name clothing, a new car every couple of years, a fancy home, etc. are desires, not needs. American society, in particular, has led us to believe that everyone is prosperous and if we’re not, we deserve to live as if we are. Our consumer mindset has led us to expect so many more things than we actually need to survive.

If your family is struggling financially, look closely at everything you spend your money on and ask yourself, is this something I really need, or can I live without it? The answer may surprise you.

It may be hard for some of us to examine underlying attitudes toward money and thrift, but with so many people losing their jobs, prices rising continually and no quick fix in sight, it’s critical that we all develop a more frugal mindset. It may be our only defense in a world filled with economic upheaval and uncertainty.

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