Frugality is a Mindset

Frugality is a way of looking at things; it's a mindset. Just like anything else, people have certain beliefs and patterns of thinking, and that becomes their mindset.

I think it's a very good mindset for simple and economical living. Let's look at this mindset to get a better idea of what the frugal among us might be thinking and what they believe in.

There is no need to "copy" someone else, but it certainly pays to gain insights from those who have been successful.

The key to my financial freedom has been conservative financial decision-making. It has helped me create a comfortable, debt free lifestyle that provides me with peace of mind. It's a core attitude about money management and creation of wealth.

To provide insight into the mindset of frugality, I'm willing to offer a peek at mine. After all, it's the mindset I have the most knowledge of.

Here are six core concepts of frugal living as I see them. They are the leading sentences in the paragraphs below, and I've highlighted them in bold text. These concepts have taken me a long way toward establishing a life of financial security. They're like a rudder on a ship. If you lose sight of the concepts (as I once did), you won't be able to stay on course and you’ll fail to reach your destination. You’ll drift around, and you'll live like you’re drifting.

Stay on concept, and you will be strong and in control.

1. Create a vision of financial freedom, and avoid obstacles along the way. One of the obstacles will be you. Whether you like it or not, chances are that you are the most formidable obstacle to financial freedom that you will ever encounter. You just might be your own worst enemy. Many people are, myself included.

Here is a story of two life situations, both are living on the edge. One with success and one with miserable results. Each have been created as a result of decisions made by individuals just like you and me. This might be called a comparison between the frugality minded and the frivolous.

Another frugality interference factor is the idea that we can get used to it, no matter what "it" happens to be. Carefully consider what you're doing to make certain you aren't capitulating when you want to compromise.

If we truly want financial success in life and a good shot at creating financial freedom for ourselves, then we need to stop playing the victim and stop living one day at a time.

Another obstacle is our tendency to react with emotion instead of thinking with logic. We've all heard that happiness is something that money cannot buy. We often ask can money buy happiness, and it simply can't because happiness is rooted in achievement and self worth, not making purchases.

When you find yourself in a "bad place," just remember that some people won’t change stubborn habits until they get disgusted with the results they've created for themselves. I know sometimes I have to get mad at myself before I change.

For others, a simple and frequent self assessment is sufficient to help keep them on course. It's something we need to be doing every day of our lives to help avoid poor decision making. Once we get good at it, then it comes naturally to some of us. For others, we need to make this assessment rather deliberately to keep us heading in the direction of our goals. Whether you're looking to create wealth, retain it, start a new enterprise, or achieve something else altogether, a little assessment of where you're at and where you're likely heading is always helpful.

Making a change often requires that we act like it before we become it. We need to have a can do attitude before we can do just about anything. It's called courage, and living a life of frugality requires a bit of it.

Along with courage and attitude, we need to improve our sense of individual responsibility and continue to cultivate it as part of our personal culture. If we dodge responsibility and keep blaming others, we're only spinning our wheels and digging ourselves deeper into a "can't do" mindset that won't help us one bit.

Oddly enough, once I got mad enough (and desperate enough), my financial freedom was secured for me by investing money very close to home. I put what little I had in the hands of someone who I trusted. It was someone who I knew would work very hard on my behalf - me!

2. We need to understand financial advice from others because it can have motivations that aren't consistent with where we're headed. No matter what others say, only you can answer "Can you afford it?" when it comes to making purchases.

The key here is to understand that people afford what they choose to afford, and not what they think they can afford. There's a huge difference here. One choice is made based on emotions and the other is made based on rational thinking and a focus on frugality.

A big part of my financial downfall was listening to others make suggestions about how I should spend my hard-earned money. Never let anyone twist your arm about spending your money. It's yours and it represents your hard work. Only you should be concerned about how it's spent.

If you're letting others tell you about how to spend your money, then you're hanging around the wrong people. I believe strongly if you hang around smart people – they make you smarter. The opposite is also true, so choose your company wisely and you'll benefit from that good decision making.

3. Money management isn't easy for many of us, but I suggest it's similar to managing nearly any other asset. All it takes is a little understanding and a little practice. You don't need to be an asset management professional. You only need to know the basics and be comfortable managing your own affairs.

If you think you're not capable of effective money management and you believe that you'll never be accomplished in that area, it's probably because you've never given it a serious try. I suggest you get started by defining what financial independence means to you, and start taking responsibility for this aspect of your life. The next step is to have a reasonable money management plan with a strategy for success. It's not all that difficult.

For successful money management, you'll need to adopt other elements of the mindset of frugality. Here are ones that I follow carefully. Savings should be as regular as your paycheck. Create wise criteria for investment of your hard earned money. Invest in you because it's one of the best investments you can ever make. Invest in your future because it's always coming at you.

Also, consider the return on investment you expect to received, even for basic purchases that don't appear to be investments. If you expect to build wealth, you'll have to make certain your savings is coupled with higher earnings. Wealth accumulation goes much faster when you combine saving more with earning more.

4. Personal finance is really a matter of understanding how you're going to pay for you and your lifestyle. In order to do this effectively, you have to know the difference between needs and wants. Many people don't.

You'll also have to commit yourself to meeting your basic needs first and foremost. This is accomplished by distinguishing between important versus urgent matters. You'll also have to commit to live within your means – well within your means. This will require that you reduce expenses where you spend the most, and know the difference between cost and value – it's the measure of return on investment.

5. If you're getting out of debt or trying to stay out, you can learn plenty of lessons from my own story. I got out of debt by investing money in my own business. Whether it's debt or financial success, I believe that in a general sense, we get exactly what we deserve.

Part of getting what we deserve is having a goal in mind and a way to get there. If we don’t plan it, we'll never make it happen. Anything impressive, significant or noteworthy that humans have accomplished has always involved planning, so we need to be capable in this area.

Failure in the area of frugality is often encouraged by credit cards and our lack of understanding as to how they should be used. Credit cards are only a convenience. If you view them as anything else, then you're likely headed for trouble.

When you're deep in trouble, sometimes it matters little how you got there, and mostly how you're going to get yourself out. Declare bankruptcy if you must and only if you're ready to to live your life consistent with a mindset of frugality. Otherwise, you'll head right back into financial trouble again.

6. Simple ideas for frugal living are often the best. Learn what a good idea for your life of frugality looks like. As I wrap up this section, let me give you a handful of frugal living ideas to consider.

Practice delayed gratification to keep yourself financially enabled for things in life that really matter. Understand six ways to help yourself delay gratification and stay the course of frugality.

And, don't confuse being frugal with forced frugality. One is playing the game, and the other is allowing yourself to be played.

You'll find that debt free living makes your income go way farther than you ever thought it could. I stretch my income by living off of what others waste. It's unimaginable the value of what's wasted in America until you start to take a good look.

For some things in life, you need to ask for help and build a team. It can be fun and lead to much more success and satisfaction. Simple living is often much better than being wrapped up in the complexities of our high speed, high stress and high cost world of consumerism.

Start using money equivalent thinking to help you determine the true cost of things.

Trading is a good way to obtain things without spending additional money. If you dicker, you can save money on a wide range of purchases. There's nothing wrong with sharing, and it can save you plenty.

Be more self reliant in many aspects of your life. Know what you can do well, and make that work for you in terms of increasing your income and reducing your expenses. You don't have to focus on self sufficient living, but at least reduce the number of areas in which you truly are a dependent of others.

Lastly, it's okay being different. You'll have to get used to it because with a mindset of frugality, you'll likely become successful, satisfied, confident, at peace with yourself, relaxed, optimistic and financially comfortable if not wealthy. Yep, that's different from most folks, so get used to being different.



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As a small business owner, it's important to be frugal wherever I can, but I never skimp on communications with my customers because that's very important. If you're running a small business, you might want to consider a business voip plan for your phone system so you can stay in touch and still stay within your budget.