Frugal Living Tips

Before we unveil some frugal living tips, let’s debunk some rumors about frugal lifestyle. First and foremost, it does not require you to compromise on your demands; instead, it teaches how one should prioritize and make choices. “Simplicity in everything” – that is the most precise definition of being frugal. Secondly, it’s not always about saving money – it’s about spending money in the most intelligent manner.

One of the most important principles that will help you lead a successful frugal life is to live below your means. Although this is the basis of all the other formulas, a number of people don’t even know how to do it. But you need not worry about anything as this very article is going to reveal some valuable frugal living tips.

Tip 1: The 70/30 Plan

As the name implies, the 70/30 Plan favors consuming major part of your income (70%) while saving a relatively smaller part (30%) for your future. Now, that’s entirely up to you that how you manage your 30% of savings. For instance,

• You can save 10% for your children’s future
• You can give 10% to charity
• You can save 10% for food storage

That’s totally up to your needs and requirements. What we advise is to follow the plan; further strategies are yours.

Tip 2: Say no to Debt

Consumer debt and loans are the biggest hindrances to being frugal. When you opt for a loan, you lose control over your income as you have to payback your provider either in monthly or quarterly installments. Therefore, you must say NO to debt.

But what if a person owes money to someone and he still wishes to lead a frugal life? Well, he can be successful by simply following the 70/30 rule. Yes, he can give a part of his savings to the bank or consumer loan provider until his debt is eliminated.

Tip 3: Always do the math and keep up a good budget

Doing the math and keeping track of your expenses is one of the most powerful frugal living tips. When you write down your monthly expenses against your income, you can easily calculate the difference. If it’s positive, then it’s not difficult saving up money. But if the difference comes out to be negative, you’ll have to work hard to save your money.

Tip 4: Maintain a backup

You must create an emergency fund with a designated amount (depending on your situation – can be a thousand dollars or more) that you may use for immediate purposes. For instance, if you find it hard paying back your consumer debt, you can withdraw money from your emergency fund and simply repay your debt. This way, you will not be paying interests and penalties.

Tip 5: Get what is needed or required

This is all about wresting with one’s own thoughts and desires. A number of people would prefer to purchase what they “can” from their salary and - on the other hand - some people will get “what is needed” and save the extra part for the future.

The latter type is intelligent and frugal while the former spends money for the sake of spending. Therefore, frugal life is all about being simple and smart so that one can make rational decisions in his or her life.

Also, it’s not about controlling and being simple all the time. If your salary is too low to support your expenses, you must find additional sources of income so as to make both ends meet.