1) Learn to distinguish between “want” vs. “need.”

2) Learn to harness the need for instant gratification and embrace delayed gratification instead.

In my experience, I first had to identify the situations where I went the instant gratification route, and then determine what was really going on in my emotional life. Trent describes being depressed or upset as his trigger.

For me, it was a sense of hopelessness about the future. “There’s no point in denying myself this purchase, it won’t make a difference anyway, I’ll never get anywhere financially because I came from working class and I didn’t have the financial/social/safety net advantages of folks with money.”

Then it became a self-fulfilling prophecy; I’d spent more than I could afford on things (mostly intangible experiences, like travel and eating out, not on material items), and I was juggling bills trying to make payments while still spending more to make myself feel better.

I got the first lesson down pat pretty easily. The second lesson took time (measured in years), introspection, and analysis.

Interestingly, the more I learned to control the instant vs. delayed gratification, the more hopeful I became, not just in financial areas, but in all areas of my life. I’m actually happier.

I saw money piling up in my accounts. I stopped having to juggle bill payments. I was able to save, invest, and help others in trouble without a second thought. It was a tremendously good feeling when I could write checks for many thousands of dollars several times to help others in a severe crisis, without expectation of ever being paid back, because it was the right thing to do and I because could afford it.

I had a medical emergency that ended up costing me many thousands of dollars out of pocket. It was wonderful not to worry about hassling with the insurance company about treaments and payments; I paid whatever I needed to pay to get the best care possible, and later I dealt with getting reimbursed from my health insurance. I didn’t get reimbursed appropriately, but it doesn’t bother me, because my health is now so much better. I can always make more money, I can’t replace my health.

I had a potential job layoff situation in the past year, and the combination of my emergency fund and my savings/investments eliminated most stress about the potential job loss. I knew that I would be fine for several YEARS of unemployment if I was willing to tap into the money I had saved up for a hefty down payment on a home.

The reduced stress made me much more relaxed during job interviews because I wasn’t desperate to land the jobs, and much more selective about which jobs I would consider in the first place. I ended up with a pretty good job after all.

After I got the job, the interviewer commented that I seemed so relaxed and confident in the interview, which really stood out, that he felt I truly was head-and-shoulders above the other candidates in terms of skills and abilities.

I also know I can walk away from this or any other job if I need to. That is a hugely liberating feeling, and it’s all because I have reduced the amount of money that I need to survive on, and because I have saved and invested the excess funds over the years.

In a few years, I plan on retiring at a reasonably young age. I will do some charitable work, or possibly some low-paid work that does good things in the world, and I won’t have to worry about making enough to make ends meet.

That is true freedom. Freedom tastes wonderful. I’m willing to delay gratification to get there.

The changes in my spending habits (distinguishing between wants vs. needs, delaying gratification, and paying myself first for saving/investing/retirement) are now ingrained. I don’t have to think about it at all, and it’s not some tremendous sacrifice.

I still eat out, I still travel, and I live in an expensive city. But I’ve learned how to cut expenses where it matters little to me, so I can spend more where it DOES matter to me.

On my paycheck, I take home about 57 cents for every dollar I earn. Taxes, insurance, etc. eat up 43 cents of every dollar I am paid. I am much better served by saving an extra dollar vs. earning an extra dollar. Also, I can control my savings. I can’t control what I’m being paid.

When the company I worked for had a business downturn due to the economic crisis, the first thing they did was freeze salaries, and eliminate raises, bonuses, and awards. Then they started eliminating positions and talked about cutting salaries for the remaining employees. That’s when I bailed out.

For the record, I will NEVER make my own laundry detergent (and I was a chemistry major!). I do make my own window cleaner, however. Not because it’s less expensive (it is), but because it works better on the window exteriors which get very soiled with city air pollution.

Much of the personal financial information in books, on the Web, etc. focuses on the mechanics and “how-to” of financial decisions. To really make positive changes in our lives, I think we have to look at the EMOTIONAL aspects of money in each of our lives.

Make-up remover: Add a couple drops of a mild essential oil (for scent, I recommend rose. otherwise totally optional) to a cup of vegetable or mineral oil, and you’ve got a cheap, effective and healthy makeup remover. Just use it on a cloth or a cotton ball.

Homemade bath salts are easy. There are lots of recipes on the web. Or just add a drop or two of your favorite essential oil for a special, scented bath.

Cloth napkins. The synthetic ones wash beautifully.

I do make my own laundry soap and use vinegar as fabric softener, because I tried it and it works for me. If it did not work for me, I wouldn’t still be doing it.

The bigger picture and the point that Trent is trying to make with all these tips, is that if you want to save money, it’s those little things that you do to save pennies here and there that will do it and not anything major. It’s like dieting. Both are lifestyle changes and to be successful, it takes baby steps. If you plunge headfirst into either, you will fail and go back to your old ways.

There is always a bigger picture when saving money, and you have to look at the bigger picture. With eating out, for example, yes, it’s cheaper to cook for yourself, but in the bigger picture, if you cook from scratch and don’t rely on convenience and processed foods, you will save money on your health care costs when you are not suffering from preventable diseases brought on by eating these foods.

Frugality forces us to stop and slow down and work for things. People who want instant gratification are not going to embrace frugality unless something happens to them to force them to be frugal. And when they see the benefits pay off, they will wonder why they never thought of doing this before. Being frugal requires patience.

When we make laundry detergent it’s often more ecological, so comparing it with store bought ‘green’ detergent making it is cheaper (I’m not in the US so assuming Tide isn’t ‘eco’). And we’re not just saving money, we’re reducing pollution.

When we eat at home, we can make healthy meals with quality ingredients for less than eating out – improving health, saving petrol, teaching our kids important skills and saving money.

Thermostats are a bit beyond my experience (we don’t have heating or air con) but I’m assuming that it’s reducing carbon footprint as well as saving money.

Saving money is great, I’m a big fan, but there is so many more benefits to being frugal that makes frugal living (and saving small change here and there) to me really exciting. As they say: “from little things, big things grow.”

But there are ways we truly do enjoy cutting back. Based upon an article by a dentist in Mother Earth News, we now make our own toothpowder…just baking soda, a little salt, and some winterberry essential oil from Whole Foods. (Note…this concoction doesn’t have flouride). Our dentist has been very pleased with our teeth, and our mouths never felt cleaner! The cost…about thirty cents a month!

Let me ask these questions, and think out of the box:

1. Why is it necessary to throw everything for a wash everyday and create one laundry per day? What makes everything so dirty or messy or so filled with germs? NOTHING. Think outside the box.

2. What makes eating raw vegetarian foods like cereals, eggs, fruits, vegetables so difficult? Why does everything have to be cooked? NOTHING. Think outside the box.

3. What makes people keep their homes at 72-76 degrees in the winter and 74-76 degrees in the summer? Why not 66 degrees in the winter and 80 degrees in the summer? NOTHING. Think outside the box.

4. What makes people buy drinks and snacks from outside instead of packing it from home in little plastic containers just in case we get hungry. NOTHING. Think outside the box.

5. What makes someone throw away a product before the engineering life of it is over? Just cause a new one came out? Do you do that to your Washer, Refrigerator, Desk, Plants, Pillows, Socks, Fans, Toaster, Loaf of Bread, Spoons, Patio, Clock, Door, Wall Switch, Toilet, Headlight of a Car? NO WAY. Think outside the box and use the products to the end of the life, since that was the intent when we bought it.

Bottomline is that I can keep going. Every convenience and impulsive thought/action has a HIGH COST associated with it. Every planned thought has a lower cost and higher savings associated with it.

Bullet 5 will give you the BIGGEST SAVINGS in life than anything else.

As a result, I paid off my 1st home at age 41, have had no debt on credit cards or loans, have more money in the bank than myself or my kids will need (buy only you know that), and have been handed down a portfolio from my parents that I do not even know what to do with, so told my Dad that I will be the ‘gardener of that portfolio’ and pass it on to my kids.

Not bragging…..Just preaching what I do. Not trying to change anyone – Just showing a different road. Not boasting about my no-debt (since it is too personal to me), but you will ENJOY LIFE MUCH MORE during/after these changes.

Hope this view is different and helps, but along the lines of the author of this article.

Kenny

ps: Please publish any of these ideas in any article if you like it.

The most important thing about all of this frugality is that we’re making conscious decisions about how we want to earn/spend $. Thanks for all these good ideas!

You will also never convince me to make my own laundry detergent. Ever. I tried and it’s not enjoyable on any level to me.
Also, maybe Marco already works 2 jobs and doesn’t have time to spend making his own detergent. Or whatever.

It was definitely a good investment of $24.99. :) We just moved into a new house and that was the first thing I installed, again paying $24.99 because they were on sale everywhere in October.