
Frugal living is not something that happens overnight. It’s a lifelong journey guided by our habits and decisions when it comes to money. Making small changes on a daily basis can have a substantial effect on our lives.
These frugal living habits will help you learn how to budget your money, destroy your debt, save like crazy, and start investing to reach financial freedom.
What Does Frugal Living Mean?
To be perfectly honest, it means something a little bit different to each and every person, but in general, it means living within your means and not spending money unnecessarily.
To put it simply, it implies being intentional with the money and belongings. There are some big similarities to minimalist living.
While we’ll get into some specific mentalities and habits shortly, which will get you into the right mindset to look at your situation (and your finances) from a different perspective.
In a nutshell, there are 3 basic rules to simple frugal living:
- Minimize the waste you create (reuse whenever possible).
- Maximize the value of every single item you spend money on (and even some things that you don’t spend money on).
- Let go of the idea that money = happiness, and that money = popular/successful/worthy/etc. (Those are all just lies to get you to spend more money and stay miserable.)
What I do want to take a second to point out is the difference between frugal vs cheap.
If you live frugally, you’re making smart choices with your money, getting the most value for each penny spent, and not purchasing things that have low value.
For example, buying a Honda or Toyota vehicle knowing they are the most reliable cars on the road.
On the other hand, if you’re living cheap, well, I hate to say it but you’re actually not being very smart with your money.
You’re buying a cheaper, off-brand TV because it has a lower up-front cost, but you’re definitely going to need to replace it much sooner than if you had bought a higher-end/better quality TV.
You might buy shoes that only cost a few dollars, but if they’re running sneakers and you’re training for a marathon, I doubt you’ll make it to marathon day before they’re worn out entirely.
In a very simple but straightforward example, consider this:
- Frugal: Go out to dinner at a restaurant. Only drink water, and skip dessert to save a few dollars. Tip the waiter at least appropriately, if not generously (20%+).
- Cheap: Go out to dinner at a restaurant. Order anything you want, realize you need to save a few dollars and give the waiter a really crappy tip (maybe 10% or less).
You don’t have to be a cheap skate in order to be living a frugal lifestyle. We suggest making small incremental changes if you have doubts. This will allow you to start living frugally and still be a kind and courteous person without feeling overwhelmed.
Another example that demonstrates the true frugal meaning: When shopping you may find yourself choosing value over the price of an item. A frugal person won’t be afraid to spend a little bit more money on something they know will last them longer. A cheap person will try to find the least expensive option available, to spend as little as possible.
What Benefits Come From Frugal Living?
Now we aren’t trying to talk you into an extreme frugal living, where you reuse bath water with your entire family to save on your water bill or something!
But there are a number of benefits to frugal living. Some examples are:
- Improved mental health. If you can live within your means and stop worrying about how your life compares to others, you’ll feel much less stress and less desire to “keep up” with those around you.
- Increased overall wealth. Whether this starts to happen immediately or it takes a little longer will depend on your income level, but in general, you’ll be spending less money on things that don’t matter and start seeing an increase in either savings or money spent on things that do matter, such as memorable family vacations. Wealth isn’t just measured in dollars, after all.
- More satisfying family life. With less money going out the door every month, you’ll very likely be able to right your finances to finally get out of debt, not need to work as many hours (as you were when trying to pay off debts), and have more time to relax and enjoy your family without feeling stressed that you aren’t at work.
- Capability to have more freedom. You may find that frugal living is the key to being able to minimize costs to such an extent that you could retire early. Maybe it simply allows you to have a comfortable disposable income each month.
How To Enjoy Living a Frugal Lifestyle?
This is pretty easy, so I’ll keep it short and sweet: stop caring what your life looks like in comparison to anyone else’s life, and start enjoying it for exactly what it is this very minute.
I mean, it could always be worse, right?
Really, that’s all it takes. With a little more pause before you buy, and a little more creative thinking before you complain, you really CAN live a life that feels fulfilling, comfortable, and enjoyable, all while being smart with your money.
Once you settle into your own routine of living your frugal life, you’ll find that frugal living is fun and that yes, frugal living is worth it.
15 Frugal Living Habits That’ll Change Your Life
These are the best frugal living tips that you’ll find, because rather than giving you a specific list of “buy this, don’t buy that,” we’re giving you the mindset required and the mental tools necessary to help you learn how to be frugal.
Because again, everyone has a slightly different scenario and frugal living could never be compiled into a list of specifics.
We want to you work hard on this, and one day find yourself living a frugal life and enjoying it — I mean, we sure do!
1) Always think long-term when making decisions
Again, don’t get cheap people confused with frugal people. There is actually a difference. Cheap people always look for a quick fix, something that will benefit them immediately. Frugal people are always looking for a long-term solution.
Get into the habit of thinking long-term when making purchases, especially “big” purchases. Things like appliances, cars, and houses should be thought of as a long-term investment. These are items you want to get the most value out of in the long-term.
Being able to sacrifice your desire for instant gratification and a fast solution will save you a ton of money.
2) Always seek the best value
Whether it’s a new pair of sneakers or a meal from the grocery store frugal people always seek the most value. Frugal living is all about getting the most value out of your money.
Instead of buying quantity start thinking about quality. You want your purchases to continue to work and provide value years down the road.
Did you know you can earn cash back using companies like Ibotta? Using cash back programs are a great way to help get the most value with your purchases.
3) Never pay full price
Find coupons and deal shopping is what frugal living is all about. A frugal person is always looking for the best deals around and planning shopping around them.
It’s important to note that just because a store is having a “deal” does not mean it’s a deal for you. Unless the deal is an item you need it’s not worth buying. Understanding wants and needs come into play quite a bit. Start a good habit of learning to decipher between the two.
Remember everything is negotiable!
You might also consider saving any gift cards you receive as gifts to either re-gift at a later date (if possible), or use as the money to pay for a gift for someone else. Why spend your own money if you don’t have to, right?
You can even get discounted or free gift cards, if you know how to!
4) Put saving right into your budget
Have you heard of the saying “always pay yourself first”? This means that you should always put money into your savings/investment accounts before spending your money on other things.
A good habit is to automate your savings. Not only do you want to budget your savings right into your monthly budget, but having them on autopilot is also a great habit.
We use Mint & Personal Capital to manage our money electronically and automate our savings.
Click here to learn how to budget your money without all the stress, in a way that fits your life.
5) Pay off your debts…and keep it that way
While saving is important, you won’t do yourself any favors by saving a ton of money while you’ve got debts piling up on the other side of that coin.
Make it a point to tackle any and all debts you’ve got against you BEFORE you get heavy into saving and investing. The sooner debts are off your shoulders the sooner you’ll have more cash available to put into savings!
If you’re currently struggling to get out from under your debts because your income just doesn’t stretch far enough, take a look at this list of side hustle ideas.
6) Buy a smaller modest home for frugal living
Banks will often approve you for a mortgage much higher than you can comfortably handle. Stop listening to their advice! A home is the largest purchase in your life and it’s not a liquid asset (can sell quickly). Purchase a small modest house as your first home that you can easily afford.
A good rule of thumb for knowing how much your mortgage should cost is 25%-30% of your monthly take home. Since your home is such as a large portion of your budget, be realistic when deciding where to live.
Remember that buying is not for everyone. Renting might be a better option depending on your individual situation.
7) Use everything until you can’t any longer
If you want to start saving money fast, simply don’t spend money at all.
It’s true, we both wear our shoes until they have holes in them and our pinky toe starts to stick through.
Frugal people have the habit of using everything to the very last drop. This includes cars, clothing, tools, disposables, machines, appliances, and more. The longer you can use something the more money you save.
If you truly want to start frugally living, get into the habit of using everything until it’s no longer possible.
8) Use your handyman skills to repair and reuse
Learning how to repair and reuse your own items can save you thousands of dollars each and every year.
A car is a great example of this.
Learning how to replace your own brakes and complete your own oil changes can save you hundreds of dollars by its self. Add in some drywall repairs, driveway sealing, roof patching, electrical work, and plumbing and you are now a money-saving savage.
The saying “knowledge is power” is so true. Most basic handyman/repair skills can be learned by a simple search on YouTube, Google, or Pinterest.
9) Learn how to entertain yourself at home
Leaving your house for entertainment is almost a guarantee you are going to spend money. Learn how to stay entertained at your house. Buying a device like an Amazon Fire Stick is a great way to stay entertained at home.
Get into the habit of never leaving the house without a plan in place. Going out for entertainment is not a bad thing, but keeping it in moderation is a great habit.
Some great at home entertainment ideas include a campfire, dinner with friends, game night, DIY projects and movie nights.
Even better why not make some extra money with your spare time? Or even do what we did and start a money making blog. It has allowed us to achieve an income level we thought we could only dream of, making our frugal life no longer an absolute necessity, but now simply a fun challenge!
10) Cook for yourself / Don’t eat out
We are a huge proponent of this habit! Since we don’t “value” eating out we don’t and save thousands each year by not doing so.
Eating out is EXPENSIVE! Anytime someone else is making, serving, and cleaning up your food you are going to pay a premium. Learn how to cook for yourself at home. There are a plethora of cheap recipe ideas all over the internet.
Start with some basic meals and work your way up. You will soon find that cooking at home is actually fun and the money you will save will put a huge smile on your face.
11) Have an emergency fund
One of the most important aspects of personal finance is having your emergency fund set up. An emergency fund a set amount of money put away for unforeseen expenses such as car repairs, deaths, and surgeries.
The last thing you want to deal with during an emergency is where the money is coming from. Take the stress off an already stressful situation and have your emergency fund set up. This will also prevent you from going into debt when something comes up and you don’t have the money to pay for it.
Normally $1,000 set to the side is more than enough for an emergency fund, but everyone’s situation is different.
12) Find a credit card with great rewards
If you are responsible with your money then using a credit card with great rewards is a no-brainer.
Once you have decided your responsible enough to use a credit card decide what kind of card you are looking for. Do you want a travel rewards card? Cashback? Building credit? A great source to compare cards and see which ones fit your needs best is creditcards.com.
We personally value travel far more than anything else. With that being said we obviously use a travel rewards credit card to earn miles and save up for free vacations.
If you are using credit cards it’s always important to keep track of your credit score.
You can do this for FREE using a company like Credit Karma (you can read our in-depth Credit Karma review here).
13) Buy a used reliable car
This is a very debated topic for some reason. Buying a used car should be your only option when it comes to frugal living.
Cars are a depreciating asset so “investing” in a new car or even worse financing one can kill your financial future.
Use a website like Kelly Blue Book or Edmunds to research, compare, and find the value of cars. After completing your research, go on a site like Craigslist and start a search for cars that are of good value. We also always use Consumer Reports when purchasing a car.
Buying a reliable car is important in steering clear of large expensive repairs. Brands like Honda and Toyota are always rated top notch when it comes to reliability.
14) Never gamble
Did you know the average American spends $300 a year playing the lotto? What a waste of money! You have better odds of getting struck by lightning twice in the same day.
Although casinos and playing the lotto can be very enjoyable for the rush of winning it big it’s not a good habit to be in. Save your money and put it elsewhere that’s more important in your life. Better yet invest that money.
15) Declutter and avoid letting it build up again
While “stuff” sure does seem nice to have, think of how much money you’ll save by not buying it, how much space you’ll keep freed up by not having it, and how much time you’ll save not having to keep it all clean!
If you don’t need it anymore, don’t like it anymore, don’t fit it anymore, etc., send it straight to the donation pile and wish it good riddance! Better yet, have a garage sale and earn a few bucks, that you can put towards paying off those debts or building up your savings.
While you’re on your decluttering mission, make sure your home is super well organized so you can eliminate the risk of buying duplicates because you forgot you had something or, worse, couldn’t find it!
Frugal Living Frequently Asked Questions
How Do You Live a Frugal Lifestyle?
You can start to live a more frugal lifestyle by making more intentional life decisions. Become selective about your spending habits, and making sure that your purchases align with your budget goals.
How Can I Become Very Frugal?
You can become very frugal by becoming informed of your spending choices, and learning to use a budget. Understand the time value of money, and make sure that you get value out of everything you purchase.
Is Frugal Being Cheap?
No, most people would say they are two different things.
Is Being Frugal Bad?
Being frugal usually is not a bad thing unless you’re allowing it to control all of your spending decisions. You’re allowed to buy things you value or that you receive joy from, such as a nice cup of coffee from time to time.
Bonus Frugal Living Tip: Start a Side Hustle
Take Online Surveys – The perfect side hustle while you watch tv, wait in the doctor’s office, or even sit on the toilet. Yes, you can make money while you use the bathroom.
Start a Money Making Blog – It takes a lot of effort up front but once you start seeing the success the sky is the limit. Our blog brings in over $10,000 per month!
Start a Facebook Side Hustle – Want to make money using Facebook. There are plenty of small business owners in need of marketing help. The perfect flexible side hustle anyone can start.
Teach for VIPKID – If you love working with kids and have some teaching experience why not earn up to $22/hour teaching English online?
Become a Freelance Writer – Freelance writing can be an incredible side hustle. Earn anywhere from $0.10-$0.20 per word depending on your experience.
Become a Proofreader – Love to read? Why not get paid to read others work and find spelling/grammatical errors. You can easily earn a few hundred dollars a month in your spare time.
Become a Pinterest VA (virtual assistant) – Love being on Pinterest all day and all night? Why not help other online business owners market their business with your Pinterest skills?
Flip Items on Ebay and Amazon – Love going thrift shopping and finding neat things to turn into cash? Start your own flipping business today!
Start a Book Keeping Business – Love working with numbers? Why not start a legitimate work from home business as a book keeper?
Good list. Definitely like 6 and 9.
Cut cable and ditch Verizon/AT&T on the cell phone.
We still have Verizon and pay around $90 a month. Would love to cut that expense down. How have you liked AT&T?
I suggest looking into xfinity mobile and Tello! My hubby and I pay $20 per month for the two of us combined for xfinity mobile!
Go with Tracfone. Unused minutes, texts & data carry over if you do not use them in a given month. By buying an annual renewal, that costs only about $120 ANNUALLY or about $12 per month.
If you need more data, you can add that along the way. Still a lot less expensive than ATT/Verizon/Sprint, etc. In the USA, the cellular companies attempt to lock you into a contract that limits your flexibility and also costs you a lot more than you need to pay.
6) Use everything until you can’t any longer
Totally agreed! I just mended a T-shirt I got for free 4 years ago and feel pretty good about wearing it for more years to come 😉
Yesssss!
Great post. Now I just got to get my girlfriend to agree to some of them lol
Good luck! Maybe we need an article on how to get your significant other to live more frugally.
That definitely would be a good one. She grew up spoiled so she doesn’t know what it means to save up or to not be able to get everything she wants lol. She tries though 🙂
Hahaha you are going to have to show her how much fun investing is and watching your money grow.
Right on!
7) Use your handyman skills to repair and reuse is SO true.
You can easily save $200 each visit from a Plumber, Electrician, Painter, general handyman, etc. The savings add up quickly especially if you own an older home!
Absolutely. The old saying knowledge is power is so true.
Be careful attempting electrical on your own if your not properly trained. As a licensed electrician I have come behind more than I care to count homeowners that have rewired some. Sometimes after a bad outcome and then can cost much more than a normal service call.
Find a good plumber and electrician IN ADVANCE OF NEED. I was fortunate enough to find an electrician who only works for himself on nights and weekeend. During weekday normal working hours he has a day job with the government —- as an electrician! He runs his own business in off-hours so charges regular (day) rates for nights and weekends.
#4 all the way!! it creates a feeling of scarcity and we make it work with what is left.
Totally agree.
when buying a house, take what the real estate agent says you can afford and chop it in half. when you get a mortgage, put a large down payment down and ask for a “reamortization” clause. this allows you to make large sum payments periodically and reduce your monthly payment (term or number of years remains the same). before you know it, a year and a half for us, your mortgage is completely paid off.
Excellent advice!! People don’t realize that real estate agents want you to pay as much for a house as possible. Their commission depends on it. Makes no difference if you’re buying or selling.
Exactly. Although a good real estate agent should have your best intentions as their #1 priority.
Great tips! Thanks for sharing! I’m definitely a fan of the mileage credit card… we just booked a trip to Australia with one ticket completely paid for through miles!
When used responsibly they are incredible.
I love free t-shirts….. Also, there are tons of companies online that will send you a free sample of their product if you ask. And tons of instant win games that can get you other stuff. PinchMe is one. They send samples (some full sized) based on your preferences and others I just find browsing Facebook. Recently got an 8 ounce sample of fresh roasted coffee beans. Haven’t tried the coffee yet since my grinder broke, but it smells incredible.
I also buy clearance clothes at the end of the season in the next size for my son. Basics like jeans and shirts don’t change much year to year. I even do it with shoes.
Which company is that I also need free cloths and shoes
Always pay yourself first! Mine is set up to automatically withdraw weekly and I never miss the money! Budget what you can save and watch it grow!!
Yes! Paying yourself first is a very good habit to get into.
I’m not that much of a online reader to be honest but your sites really nice, keep it up!
I’ll go ahead and bookmark your website to come back in the future.
Many thanks
Great tips! I recently learned that #3 (never pay full price) also applies to outrageous medical bills. Always call to see if you can get a bill lowered!
An old boss once told me, “No’s are free”!
Nice post and Good information
Very nice article! I will try to keep up with the good advices and I hope that frugal way of living will be my way..thank you! Lots of appreciation, Fotini (Greece)
wow really do agree with most of this. Staying home and cooking saves money and calories. Using the same things like my 1980’s microwave and Tv they were built to last better back then and certainly I have several yard sales a year. The only difference is buying a used car if you buy an affordable new car at least you have a warranty for at least 4 years where you dont have to pay for major repairs and if you have a trade in it could be cheaper than a good used car.
Do most of the above. We were faced with unemployment for a period of almost two years and were able to survive through it because we were frugal. Our used cars were paid for, our monthly mortgage payment was low, no cable, etc…We did pick up some debt during this time -husband hospitalized and air conditioning went out. But we negotiated the medical bills down significantly.
Thanks for sharing this Fantastic! blog.
These are some wonderful tips. I have been in to frugal living and advocate it to any platform that I could find. Growing up in a frugal lifestyle environment made me realize the worth of every penny.
This is good article for me. I learn now how to spend money properly. Thank you for posting it
Our pleasure =)
We’ve learned that what is frugal to one person is not frugal to another. I like your analogy about the word frugal meaning “to not waste money”. We actually consider it to mean getting value for your money, which I guess is the same thing.