Mastering Frugality

Today’s news is full of financial doom and gloom and many people are feeling the pinch of the credit crunch. A natural reaction to this is to cut back on everything but this is often not sustainable for the long term as you feel you are missing out on everything. A far better approach is found in mastering frugality.

Here are the key factors to mastering frugality:

What is frugality?

There are many definitions but it all boils down to not being wasteful and not spending relentlessly. What is doesn’t mean is being cheap, it’s really all about spending your money wisely. This is very important to understand in your quest to mastering frugality. If you try to cut down on everything it will have the same effect as going on a crash diet – you will feel hungry for the things you don’t do or have and it just won’t last.

It’s All About Attitude

Your attitude is absolutely crucial. Over time you want to gain full control of your money and then make sensible decisions with regard to spending. You need to keep the thought in your mind that you will not miss out on the things that you really enjoy in life. Think of it as reducing your spending in some areas so that you will be able to increase it in others. You may have a hobby that you need more equipment for or more training – don’t look to cut this out. Frugality is best achieved through control and planning and that is the mindset that you need to adopt.

Being Resourceful

We are all resourceful but many people don’t apply this skill in their everyday home lives. As an example do you throw away clothes that could be easily mended? Or pay a mechanic to change the oil in your car when with a little education and confidence you could easily do this yourself and save money? Resourcefulness is a trait that you really need to develop if you are serious about mastering frugality.

Are You Organized

Do you go to the grocery store without a list or any clue as to what you really need? Are you in control of your money to the point where you know where every last cent is going? When you go to the store are you armed with money saving coupons for the items that you need? If you answered no to any or all of these then you are like the majority of people. It is reasonably easy to change this with a little effort and will save you considerable money and time. People that have developed a frugal lifestyle are always organized.

Financial Goals

Few people have financial goals. All the most successful businesses have financial targets for revenue (your income) and costs (what you are spending). Treat your personal finances like a business and set goals for the things that you want to purchase in the future (car, home, TV) and also set targets for reducing your spending – reduce your grocery bill by 20% or eating out by 50%. Of course it is no use setting these goals if you don’t monitor them regularly. Improving your income while driving down your costs is really where you want to be. When setting you financial goals think about why they are important to you. Have a big “why” associated to them like saving for a car, vacation or other important activity.

Mastering frugality is all about planning and making smart decisions about spending money. It will take a little time and a fair amount of determination but the rewards are substantial. Take the first steps now to control your money and enjoying a frugal lifestyle.

Part 2 of Mastering Frugality “Putting It Into Practice” can be found here