Comments on: Frugality Won’t Make You Rich

By: Annie

Annie — Thu, 15 Sep 2011 13:09:39 +0000

I agree with Elyn, i have no idea what kind of training some of the starbucks people have where i work. They make it like water and it’s such a waste of my money. Other starbucks locations, i can’t complain do a great job. Reason i bring this up is my family is the same way, we buy coffee and make it the right way. My parents do that with food also, we make everything from scratch and it tastes much better and you have the option to make it more healthy. Frugal ideas like this are more rewarding than a burdening. It really helps to save money when you do this. 5 dollars a day in 10 years returns 20K, hmmm maybe i will try this. thanks for the post.

By: Ginger

Ginger — Wed, 14 Sep 2011 18:16:49 +0000

By being frugal during undergrad, I don’t have much student loan debt and I was able to buy a duplex with my husband when he started grad school. That duplex increases our income by 20%. I agree that being frugal creates opportunities to build wealth. By continuing to be frugal we will be able to afford another duplex in another year or so.

By: Liz

Liz — Wed, 14 Sep 2011 12:01:55 +0000

I agree with Ryan, although it is not “spending on what makes you happy.” Even with health insurance, I have fairly high out-of-pocket medical expenses. Cutting back on things I don’t care about helps me purchase these items. Living on one income, two adults, can be challenging. But finding ways to be frugal without big sacrifices makes it bearable.

By: Ryan

Ryan — Wed, 14 Sep 2011 10:48:09 +0000

Bottom line is that it all boils down to cutting back spending on things you don’t care about while spending your $ on what makes you happy. Being 100% frugal in 100% of your life isn’t needed, all you guarantee with that is leaving a huge inheritance for your heirs (not saying there’s anything wrong with that)

By: Brittany

Brittany — Wed, 14 Sep 2011 00:59:00 +0000

This was a great article–first one in a while. Right on.

By: Steve

Steve — Tue, 13 Sep 2011 21:33:00 +0000

Frugality is necessary but not sufficient for wealth. You need both Frugality and Income (by which I mean, some way to get income, sooner or later). Frugality without Income will avoid debt, but not create wealth. Income without Frugality won’t get you wealth because you’ll just be spending all the Income. You can’t get rich without some frugality; but you can’t get rich from frugality alone.

By: mike crosby

mike crosby — Tue, 13 Sep 2011 21:09:26 +0000

I like it.

And the fact is, most of us will not become rich. But by being frugal, life is sure a hell of a lot more enjoyable.

By: Steven

Steven — Tue, 13 Sep 2011 20:23:39 +0000

I think using a fictitious character named Joe Average and NOT using average numbers is misleading…and Adam P is right, his point could have been made just as easily using average numbers. He’d have better off calling his character Joe I’m-way-over-my-head-in-debt rather than Joe Average. Maybe even Joe Blow…just not Joe Average.

Hey, we’re all entitled to our opinions, and this is mine.

By: Other Jonathan

Other Jonathan — Tue, 13 Sep 2011 19:42:24 +0000

Steven, he didn’t say those are averages, he just made up a fictitious character and called him “Joe Average” for a sense of relatability.

By: Adam P

Adam P — Tue, 13 Sep 2011 19:42:18 +0000

I don’t really know why he used such high amounts of credit card and student loan debt for his Joe Average example either, Steven.

The point would have been just as valid with more normal numbers, say $25,000 in student loan debts and $8,000 in credit card debt.

By: Steven

Steven — Tue, 13 Sep 2011 19:21:11 +0000

How is $80,000 is student loan debt “average?” Do you just pluck these numbers out of thin air?

“Two-thirds (65.6%) of 4-year undergraduate students graduated with a Bachelor’s degree and some debt in 2007-08, and the average student loan debt among graduating seniors was $23,186 (excluding PLUS Loans but including Stafford, Perkins, state, college and private loans).”

Finaid.org

By: elyn

elyn — Tue, 13 Sep 2011 19:13:47 +0000

I think this quote is a misconception about frugality:

“What good is that if it brings you misery?” they ask. “It can’t possibly make you rich!”

At our house, we make our own coffee- and done right (and there is a right way to do it), it tastes MUCH better than any coffee shop coffee I’ve ever had. We cook at home most of the time, and this also tastes better. We walk most places, we have a smaller house than most. We don’t have or miss cable. We don’t have air conditioning. We used cloth diapers, and did very early potty training. The list goes on and on.

None of these things make us miserable, they instead make life pretty good while saving us tons of cash, which we use for investing. Miserable would be handwashing our laundry, forgoing indoor plumbing, etc. I think this misconception that giving up small or even big things causes misery comes from a fear of having to examine your life and make changes.

By: Marinda

Marinda — Tue, 13 Sep 2011 18:54:08 +0000

Frugality for my family gave us the opportunity to purchase hearing aides and glasses for our child when she needed them. We continued those frugal habits and created wealth. With our good habits, established to take care of medical costs, when those were reduced, we put our money into CD’s, the stock market, retirement and paid off our house. We are retired and not yet 60. It can give you peace of mind, a chance to grow and work for yourself and over the period of time (years and years) you can amass wealth. Oh, we treated ourselves to lattes, have traveled to all 50 states and to Europe. Our children have graduated from university, both are free of debt, one owns her home. We drive new and used cars, have magazine subscriptions and use cell phones. But we did NOT do all of this years ago, we added on the treats as we could afford them.

By: Telephus44

Telephus44 — Tue, 13 Sep 2011 17:48:41 +0000

I agree that frugality creates opportunity, not riches. I think the confusion lies is that while frugality is not directly opposed to creating wealth, and you can certainly do both, most practitioners of frugality DON’T focus on wealth building. They tend to focus on debt reduction and financial securiry – which aren’t the same as wealth creation. Most frugal advocates don’t say “I saved $20.00 this week, so I’m going to put it in the stock market, or loan it out on a peer-to-peer lending site, or invest in some advertising for my business.” – it’s “I saved $20 this week, so I’m going to pay down my debt, or add it to my EF.”

Again, it’s not that frugality can’t be a tool to help you with wealth creation, but it’s not often associated with it. And it does create opportunities as Trent wisely notes in his post.

By: Jenna

Jenna — Tue, 13 Sep 2011 16:50:00 +0000

Material things give no lasting pleasure, and the more one gets the less fulfilling they are. What I aspire for is to be able to retire without having to worry about having a decent roof over my head and being able to afford surgery or medical treatment I will need as I age. This is a very challenging time to save for these things, but I sure am trying.

By: JC

JC — Tue, 13 Sep 2011 16:31:34 +0000

Great post. I’m in the OPPORTUNITY phase right now – with a healthy savings account, stable and fulfilling job, and no debt, I’m able to afford some plane tickets because I’m in a long distance relationship. I haven’t abandoned my frugal lifestyle (no cable, no cell, cooking a lot at home, library patron, etc) – I just have the financial means to have more opportunities to spend time with my Significant Other.

By: AndreaS

AndreaS — Tue, 13 Sep 2011 16:14:21 +0000

Great point Trent. I believe in the saying “Luck is when preparation meets opportunity.” Even if you have no plans to create a business in the future, you just never know when that great idea might come along. In addition, the most important factor in what makes a business a success, is if it generates enough income to meet your needs. If you know how to live on less, the threshold for your business success is much lower.
I have also known people who were unable to invest in money savers (such as a freezer) because they didn’t have money in the short term.
My in-laws were children of immigrants who were unable to speak English, or read and write. My mother-in-law had a high school education. My father-in-law didn’t finish high school and his whole life worked modest-paying blue-collar jobs. They worked hard all their lives, and were very thrifty. My father-in-law, a widower, died about three years ago in his late 80s. He left an estate in excess of $300,000. I don’t know if that makes you rich, but they had a rich life, with vacations and other things they wanted.

By: Carole

Carole — Tue, 13 Sep 2011 15:41:15 +0000

I agree with the post. If one has a frugal mindset and doesn’t spend every single penny on trumped up needs and constant “running the road” then money may be available when the need or opportunity arises. Of course some people may be very frugal and there is still no wiggle room, but often that is not the case.

By: Tanya

Tanya — Tue, 13 Sep 2011 15:14:47 +0000

I love the point you make that frugality creates opportunity. We talk a lot in my office about how spending less on X means you can spend more on Y. As Emily points out, saving a little here or there means being able to pay for a car!

By: EmilyP

EmilyP — Tue, 13 Sep 2011 15:05:19 +0000

Frugality also changes one’s perspective on what “rich” means. $20,000 after 10 years is nothing? That’s enough to buy 2 good cars with and all I had to skip was a daily latte. And it means I’m in a mental state to absolutely love a $10,000 late-model-used car. Frugality means you can be a lot richer on a lot less.