Keep Things in Perspective - respond, don't react

A frugal person will keep things in perspective, so cost and value judgments are easier to make.

Toothpaste and other small purchases provide examples of times when we might lose our perspective when it comes to money.

Let’s say that one tube of toothpaste costs about $2. Another brand costs $3.50 for the same size, but it has the taste we like.

Which one would you buy?

If we only look at the cost and consider that both do the same job, we might choose the cheaper brand because the more expensive brand costs 75% more. At first, this seems like a reasonable decision. After all, we wouldn’t spend $5.68 for a gallon of gasoline when we can get gas elsewhere for $3.25 a gallon.

If we keep that toothpaste decision in proper perspective, we will recognize that a tube of toothpaste every six months will result in a $3 cost or savings each year – not exactly something that we should be excited about. So, we should spend the extra $3 a year and get something that we will enjoy using each day

If we keep things in perspective it means, among other things, that saving money of any significant amount will only come from larger and more frequent purchases, where you spend more, not minor or infrequent ones like toothpaste.

Y2K is another example of how some people can lose their perspective. Listening to the "news" caused many people to spend large sums of money on being prepared. There's nothing wrong with being prepared, but $20,000 in "meals ready to eat" and burying a large chunk of cash in the backyard for "safe keeping" proved to be knee jerk reactions instead of well considered responses to what might occur.

My neighbor at the time had done absolutely nothing to be prepared. (I think that's his credo in life.) So, instead of keeping things in perspective, he had no perspective at all. This is something that is similarly ill-advised.

To keep things in perspective means you're keeping your wits about you and making well considered decisions. You don't go bonkers, you don't go bananas and you don't go ballistic. You think and act in a rational and realistic manner.

If you keep things in perspective, you'll find that you're keeping your eye on a frugal living lifestyle without overdoing it. You live in comfort and security instead of austerity and paranoia.

There's a big difference in being frugal and being a miser, in being a thrivalist and being a survivalist, and being rational and being emotional. Stay a good and wise course by staying in perspective.

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