Cheap Talk – Richard Quinn – HumbleDollar

I’M FASCINATED by frugality. Being frugal is not the same as being cheap, though—based on what I read about some people who claim frugality—it sounds to me like they are indeed being cheap. We’re told frugality adds to the quality of life, that it creates a less stressful, less materialistic existence. Being frugal is fine, but living frugally because it’s a necessity—especially in retirement—not so much. Is a minimalist lifestyle all that satisfying?

I think being frugal is a misnomer. What we actually mean is being prudent with our money, living within our means, and not being extravagant or wasteful. In the end, the money we claim to be saving as a result of our frugality is going to be spent in some way. If you choose to live frugally, should there be a purpose, a long-term goal? If not, why do it in the absence of financial necessity?

It all boils down to my simple formula: Take your after-tax income, save what you need for a secure future, never carry a credit card balance and spend what’s left of your pay in any way you like.

When I shop for coffee K-cups, I only buy those on sale, even if they aren’t my favorite brand. I’m not paying $10 for 10 cups of coffee. Am I frugal? I rarely buy from Omaha Steaks. But if there’s a so-called sale, I might.

Is that frugal? I’m thinking neither is frugal. Why buy K-cups except for convenience? Similarly, I could buy beef less expensively if it wasn’t shipped from Nebraska.

My grandfather removed every piece of tinsel from the Christmas tree, placed it in a box, and used it year after year. I never heard him use the word frugal. It was more like, don’t waste anything. In my grandparents’ day, that’s how most people lived—waste not, want not.

There’s a no-name, cash-only gas station near me. It always has a line of cars waiting for gas. Sometimes, they call the police for traffic control. What amazes me is that the line of cars includes many BMWs, Mercedes, Porsches and similar cars. Do we call that frugality—saving 20 cents a gallon when you own a car that requires premium gas? Not in my book.

I recently read a discussion about a leather chair that had torn arms and seat, so the stuffing was falling out. The question was, have it repaired, throw it out or simply use a slipcover? Slipcover was the frugal choice. I can just hear that discussion in my house. “It’s not that bad, hon, just put a slipcover on it.” My wife’s response: “Get the car, we’re going shopping.”

READ THE REST OF MY ARTICLE AT THE LINK BELOW

Source: Cheap Talk – HumbleDollar

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