Often times the word frugal is thrown around with a negative connotation for someone who is a cheapo. In some ways that’s not wrong, however someone who practices frugality generally does so with a purpose other than being a cheapskate. Frugalism is typically practiced by those who are financially sound and are in tune with their financial goals. The practice of frugality can be done on many different levels, but I like to classify the intensity into three categories, the laxed, the focused, and the hardos.

Levels of Frugality

Before we dive deep into these categories I want to make it clear that these are my personal thoughts and frugality can be practiced in many ways. These are just three categories that I have created to present the intensity levels of frugality.

The Laxed

Also known as the “relaxed” level of frugality. This level of frugality is for those who are conscious with their level of spending but don’t drastically change their lifestyle. They may cut back on unnecessary spending, such as eating out less or shopping less.

The laxed style is a great way to start practicing frugality. It shows that you are more aware of your spending habits and have control over it without drastically changing how you live. The next two levels of frugality get a little more serious and require some more discipline and lifestyle changes.

The Focused

I think of this level of frugalism as the middle ground. People who fall into this category are those who are financially conscious and have set monetary goals that they want to accomplish. If you fall into this category you are willing to make some lifestyle changes.

Some of the everyday things that make life comfortable are now easier to get rid of in order to accomplish your goal faster. Things like cable may be cut for something more affordable such as netflix. Going out every weekend for drinks with your friends is now no longer sustainable. You may decide that only once a month is more appropriate.

The focused group is very attuned to what is important to them and they are willing to cut things out that aren’t important or are holding them back from accomplishing their goals. As “focused” as this group is they still have their personal limitations and may refrain from cutting back on extreme measures.

The Hardos

As you may have figured out, this category of frugality is the most extreme. Those who fall into this category are willing to make themselves extremely uncomfortable in order to reach their financial goals.

Someone in this category may sleep on the couch of their own home while renting out their bedroom. They very rarely eat out and live on a tight budget. For some people, this is the only way for them to have success with frugality. Any other category may offer them to much freedom that they may slip back into old money spending habits. But, by going all in to the extreme they are able crush it.

Like we’ve said personal finance is just that, it’s personal and the category of frugality that you fall into is completely up to you. At the end of the day do whatever works best for you 🙂

The Point

So, what’s the point of frugality? Why make yourself live an uncomfortable life? Why not just live the YOLO (you only live once) motto?

The point of frugality is to understand your financial goals and know what is actually important to you. If you are focused on accomplishing your financial goals you will begin to become more aware with every dollar you spend. When you begin realizing that every dollar you spend puts you farther back from your goals you will start to see what is actually important to you.

You may realize that you really don’t watch tv that often and don’t actually need that $80/ month cable subscription. That new car that you really wanted doesn’t make sense to buy anymore because you realize a vehicle just gets you from point A to point B. Heck, you may even decide that you don’t need a car at all and can just bike or walk everywhere.

When you actually start to understand what is important you will realize that you aren’t making yourself uncomfortable by being frugal. But instead, you are making yourself happier by cutting out the things that don’t directly impact your happiness.

While the YOLO motto can be extremely fun, it can also be extremely reckless. It’s really important to understand where you want to be financially in the future and the sooner you figure that out the faster you can focus on how you are going to get there.

Closing Thoughts

There are three main things I want you to take away from this post:

1. Frugality is not a bad thing.
2. The practice of frugality can be done in many ways and does not always have to be extreme.
3. Frugality leads to a personal understanding of what is important to you.

I personally categorize myself in the focused group as I understand my goals and have cut back on a lot of things, but I am not willing to live in my car and eat ramen 7 days a week. As I mentioned before though, you must do whatever is right for you, personal finance is personal.

Which level of frugality do you fall into? Let us know in the comment section! 🙂

 

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