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Today’s post is going to be a bit short, but I wanted to get a few thoughts out that I’ve been thinking about. One of my friends calls me cheap. They say this because I’m pretty good at saying no to things that cost money and I don’t want to do. I call myself frugal. Who is it right?
Don’t Get It Twisted, I’m Frugal Not Cheap
I would consider myself a frugal and strategic spender or money. I place the value of a dollar higher than many people I know since I know the purchasing power of $1 invested in many years down the line. Because of this, I allocate a specific amount of spending money for myself each pay period and that’s all I get. A friend of mine divides their paycheck by the number of days before they get paid next which gives them the amount they can spend each day to ensure they don’t overspend. Then the day before they get paid they move a little into savings if they have anything left over.
I do the opposite of that. I put money into my 401K, savings, real estate accounts, investment accounts, etc. the day I get paid. I generally have $500 or so a pay period to spend for all things before I get paid again. I ONLY allow myself to spend that much money. This means that I must be strategic with the money that I spend. I’m a master of delayed gratification (mostly 😊). If I want to purchase something that costs more than the $500 I have, then I better keep that money and wait until the next pay period.
This strategic thinking leads to me declining invitations or telling people I can’t do something now. That’s not cheap. That’s frugal.
Cheap People Only Focus On Price
Cheap people only look at the price of something and decide whether to purchase it. In general, someone that is cheap bases their purchase decisions exclusively on whether the price is attractive. If I were a cheap person, I would only ever buy the least expensive option of anything I ever needed to buy. I don’t do that.
Bring Frugal Is About More Than Price
Being frugal means being cautious with the way you spend your money so that you don’t break your goals. Frugality is all about evaluation.
Being frugal is evaluation which pair of jeans to purchase based on more than just purchase price. In addition to how much it would cost, I generally consider a ton of reviews to get an understanding of how something held up over time. Jeans are a great example because the cheapest jeans are generally cheap because the quality sucks so I opt for a more expensive kind. I could buy jeans at Walmart, Target, Old Navy, etc. – those would be the cheapest at around $15 a pair if I waited for a good sale.
Those are some cheap jeans. The only problem, they’d probably last 2 washes. Instead, I opt for the much better reviewed Levi jeans. As I write this, I’m wearing a pair of Levi’s I purchased almost 2 years ago and they have little signs of wear and tear. They cost me $32. I’d rather pay the $17 different to get an extra year and a half out of my jeans before I have to replace them. In the long run, that’s a huge saving. #winning
Don’t Be Shamed For Your Frugality
People will shit on your money habits if they disagree with them. Don’t let that bother you. Remember that your finances are personal and you’re in control. You’re the only one who knows what’s going on in your life and what your goals are. Be persistent and march towards your goal.
-My Strategic Dollar