Let’s face it: Being frugal is not much fun. But, just like eating your broccoli, it is good for you. If you need some motivation, here are ten crucial reasons why frugality is a virtue worth cultivating:
1. Saving for an emergency
The most practical reason for living frugally is to give yourself a buffer for emergencies. If you are already spending everything you earn and then some, a decrease in income (like losing your job) or an increase in expenses (like illness or injury) can derail you financially.
One way to look at it is, “You never know when the day before is the day before.” Everything might be great today, but if something changed tomorrow, would you have a cushion?
2. You will be used to it
The psychological effects of a sudden change in financial status can be devastating. Going from buying everything you want to worrying about how you are going to feed your kids is more than some people can handle. Living frugally cultivates the right mindset to get you through a crisis: You really will be OK if you do not buy everything you want.
3. Not running up debt
Few people master the art of spending exactly what they earn. If you are not living below your means, you are probably overspending. And overspending means running up debt. If you overspend every month, when are you going to pay off the debt?
4. No interest or late fees
A corollary of running up debt is that you are also running up interest charges and late fees. With most credit cards charging at least 13 percent interest, it adds up fast if you are only paying the minimum each month. And that is if you are not making any additional purchases. Add in late fees, and your debt can become unmanageable before you know it.
5. You control your money, not the other way around
When your spending is out of control, your finances tend to run your life. You are always thinking about it. There is guilt attached to every purchase, and, for a lot of people, that guilt leads to even more spending. When you live frugally, you are the boss, not your money.
6. Assets are better than stuff
Some things have intrinsic value. A home is a good example. While it is certainly possible for a house to decrease in value, that is the exception. And even if your home does decrease in value, it will not lose all of its value.
Buying extra lives for games on your smart phone, on the other hand, loses value in about 15 minutes. Spending $100 on a bottle of wine? Once you drink it, it has gone. Living frugally allows you to save money for assets – things that hold their value.
7. You are not the only one affected
It is not all about you. If you are married and have children, the connection is obvious. Living frugally makes things better for your whole family. But even if you are not, that does not mean no one else is impacted.
Maybe your parents have to bail you out, or your friends end up footing your dinner bill. Even if no one you know ever puts a dollar toward your debt, that does not mean all the nameless, faceless people who will pay higher interest on their credit cards are not impacted.
8. Less stuff to take care of
We have all watched those shows about hoarders. Too much stuff can take over your life. Who wants to spend all that time cleaning? Having less stuff in your life can be very freeing.
9. It is green
Our consumer society is bad for the environment. That knickknack we just could not live with out is likely to end up in a landfill in a couple of years. And that is not even counting the packaging.
10. Personal worth is more than what you buy
Unfettered consumerism fosters competition. If someone has a new car, you have to have a better one. It shifts the focus from who you are to what you have. Living frugally refocuses your attention on what is important.
Living frugally might not be fun, but it can definitely be rewarding. Whether it is working toward a goal or refocusing your attention from stuff to people, living frugally can be one of the most satisfying things you ever do.