Updated on 07.14.08

Undermining Your Frugality

Trent Hamm

A reader named Mindy wrote in recently and asked the following:

I use all sorts of money saving tips all the time to save, but we never seem to get ahead. There’s always some expense or another that comes up, or something that my family needs. Then after a while I get tired of living cheap and not giving my kids the things they deserve, so on payday or when we make some extra money we go out and have a blast, but then the next day I feel guilty. I know I shouldn’t do this but the way we live feels so unfair to the kids. What can I do to fix this?

pf 101When I was growing up, we did countless little things to save money. We grew an enormous garden. We hunted. We fished in a fairly high-throughput fashion, putting out lines overnight to catch hundreds of pounds at a time. We raised hogs and chickens and rabbits for our own consumption. We didn’t have any television besides the big three networks until I was in high school. We read a lot, swapped books, and visited the library in the nearest large town all the time.

The thing was that we often did this out of necessity. There was rarely a lot of extra money to spend. I was the youngest in a family of five that often had additional family members living with us – nieces and nephews of my father, my mother’s brothers, and so on. With only one wage earner, money was constantly tight, and thus frugality was a natural part of our lives.

The only problem with this was what happened when a windfall would come our way. My parents often felt guilty about raising kids in this fashion, so when a windfall would happen, I’d get a new video game and some new school clothes, we’d go out to eat a few times, and before we knew it, we’d be right back where we were before.

I don’t begrudge my parents making that decision. As a parent, I know very well the temptation that I already have to make sure they have everything they need and many of the things that they want. A genuine smile on the face of one of my children is worth quite a lot to me, and I don’t know how I would act if we were in a situation like the one I grew up in. I’d be sorely tempted to do the exact same thing – when a windfall came in, I’d probably buy my kids something, too.

The painful drawback here is that doing this undermines much of the effort of that frugality. Instead of striving to spend less than you earn, spending windfalls on fun stuff is merely a continuation of living paycheck to paycheck – spending exactly what you earn. Then, when something goes wrong, you have to usually dip into debt and start stretching those paychecks even thinner instead of relying on a bit of emergency fund, and then instead of using frugality to build a future for yourself, you’re using frugality to pay down the interest on your debt.

Inconsistent frugality is wasted frugality. If you scrimp and save carefully, only to toss caution to the wind and spend like mad when you get a bit ahead, all of that effort for scrimping and saving was swapped for one rush of spending.

Think of it this way. Family A and Family B scrimp and save on a regular basis to stay ahead of the game. Family A is $60 ahead one week, $20 ahead the next week, and $100 ahead the third week. Each week, though, they spend that full amount on stuff to enjoy living in the moment: $60 one week, $20 the next week, and $100 the following week.

Family B is seeing the same financial cycle, but they spend a budgeted $35 each week on fun stuff. After the first week, they’re $25 ahead, and after the second, they’re $10 ahead. After the third, though, they’re $75 ahead. Not only that, they didn’t have a “depressing” down week in the middle where they couldn’t spend as much – they planned around it.

At the start of the fourth week, one kid in each family suddenly needs cash to rent an instrument for band. Which family is in better shape to handle the sudden expense? Family A has undermined all of that frugality in order to fulfill some short term wants, and now they’re right back where they started – having to put an important expense on the credit card. Family B, on the other hand, still had fun (and had more fun during that second week), and gets to skate right through this crisis.

Frugality is a powerful thing. It’s the “spend less” part of the one sure recipe for financial success, spending less than you earn. But it’s also incredibly easy to undermine it if you’re doing it inconsistently. Spending less doesn’t mean just cutting back when you have to – it means consistently spending an amount that’s less than what you bring in.

One great way to make frugality work for you is to budget your entertainment and other unnecessary expenses. Each week, agree to cap your unnecessary spending to an amount that allows you to spend a little less than you earn, and don’t exceed that amount. If you have something big coming up that’s unnecessary, like a trip, start saving some of that personal spending money for it. Then, whenever you’ve saved a lot one week or had a nice windfall, just let it ride. Put it into savings, and as it builds up, realize that it’s frugality that’s building this safety net for you.

Another vital tactic is to realize that the most valuable thing you can ever give your kids is your time. Sure, it’s fun to go to an amusement park with them, but the kids usually aren’t craving Chuck E. Cheese. They’re craving time with you. Instead of going out and blowing a bunch of money, go to the park and actually climb on the monkey bars with them. Play frisbee or kickball with them in the grass. Cuddle up with them and watch The Lion King for the umpteenth time, or read them a book. Dig through your closet and bust out an old board game. Quality time doesn’t have to come from spending money – it just comes from spending time doing something where your focus is on your kids and you don’t have demands pulling you away (like making supper, etc.).

Over the long run, you’ll be happier, too. Life is a lot easier when you can go to bed at night knowing that if the car blows up tomorrow, you can handle it without breaking a sweat. If someone loses a job tomorrow, everything doesn’t immediately collapse. If Johnny needs an instrument for band, you don’t have to shuffle stuff around on the credit card. While it’s really tempting to spend when you’re ahead (especially at first), when you let the money just sit there in the emergency fund, you’re actually buying something else – peace of mind. That’s one of the biggest bargains of living cheap.

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  1. ToilingAnt says:

    What kids deserve: shelter, food, clothing, love and dignity. Everything else is just EXTRA. The idea that you’re not a good parent unless you spend yourself into a hole is a lie straight from the pit. Even if that’s what your kids want, it’s certainly not what they need. The “good parent” is the one who can tell the difference!

  2. Lolita says:

    Awesome post! I couldn’t agree more….there are so many things that can be done for little or no money, it’s unbelievable! A few weeks ago, I took all of our kids(yep, 5 of them) and got them a .99 banana split. We all sat down on a bench outside and talked about whatever they wanted to talk about. They were thrilled to death that they got a “special ice cream” and I spent less than $10! When we got home, they were all too happy to tell my boyfriend where we had been. You would have thought I had taken them to Disney!

    Last week, I took my youngest to the library to get a book. While we were there, she spotted the video section and somehow she picked out a Strawberry Shortcake flick within .5 seconds! We took the book and video home and I didn’t see her again for about 2 hours….when she came down, I got a BIG hug, kiss and “thank you!” for letting her get the movie she wanted. (she’s 4 so she’s still happy with the little things. lol)

  3. Yup. That word DESERVE jumped up and smacked me in the face too. “Deserve” is a word that is used to undermine budgets, attitudes, and plenty of other things. It’s not just parents feeling that their kids “deserve” things. It’s often adults feeling they “deserve” things that are luxuries, not necessities. Banishing the word from your vocabulary in association with material things is a great idea.

    To ToilingAnt’s list of things kids truly deserve, I’ll add education. It’s a birthright for everyone on this planet. Other than that I think s/he nailed it.

  4. cv says:

    The word “deserve” caught my eye, too. I hear it and similar sentiments all the time in ads – “you deserve a break today”, “because you’re worth it”, etc. It’s really easy to play into this idea that we all “deserve” pick-me-ups for bad days, celebrations for good days, treats for achieving minor goals or special occasions, etc. It’s pervasive, and it’s another reason to turn off the tv and minimize the advertising you and your kids are exposed to. Save the treats for when you really have earned them and can afford them.

  5. Suzanne says:

    Mindy – let me ask you this – Do you deny your children love, attention, food, shelter, reasonable clothing or gifts at birthday and holidays? Then you have nothing to be guilty of. “Society”, in the form of advertising, peer pressure, and a consumer economy, tries to teach us that material goods and services give us meaning in our lives. “If I go out to eat this weekend and to the family fun center with my kids I must be a great parent.” “I should buy that new e-gadget my daughter’s friends all have so she doesn’t feel left out.” There’s no reason to give in to these thoughts. You know you love your kids. There are plenty of ways to have fun on the cheap and easy.

    A story from my childhood: Remember the year Cabbage Patch Kids dolls came out? My parents couldn’t get one for me for Christmas so the next Christmas they bought me 4 Cabbage Patch Dolls to make up for it. I was already happy with the one doll I had bought for myself using layaway at the local department store. Those 4 new dolls didn’t add a bit to my enjoyment. My parents were/are notorious for going overboard with gifts. This made no sense to me in my late teens and I do my best to dodge it in my adulthood. What made the most difference to me in my childhood was my dad coaching my soccer team, mom taking me to the library, going to football games to see me play in the band, and having dinner together each night. Once a week we would have pizza or go out to eat, though in tight times it was every other week. I never felt deprived and always felt loved.

  6. RACHEL says:

    The word “deserve” popped out at me, I was going to say something but you all beat me to it.
    The idea of being unfair to your kids bothered me too. You are not being unfair to your kids because you can’t or choose not to buy them whatever they want. I think one of the fairest and best things you could do is explain to your kids the concept of frugality and saving money, letting them know that as a family we choose not to go out to eat often, and we choose to wear generic clothing, and we choose to live this way so that later we can pay for your college and you won’t be burdened with student loan debt or later we can buy a nice house without a huge mortgage or go on vacation with out going into debt or whatever your goals are. That may be a lot to tell a young child but I think it’s important to tell your kids that as a family we are giving up something now so that later we can enjoy something better.

    Love Trent’s ideas and response, especially about just spending time with you kids.

  7. Jules says:

    I’d also mention that budgeting for “fun” things should be mandatory unless your budget is REALLY that tight. You’re less likely to splurge or overindulge if you have a few bucks set aside for fun things. And it really doesn’t have to be much–enough to rent a DVD and buy a bucket of popcorn, for instance, or enough gas money to take the car to a secluded place to watch the stars come out (I’m a science geek–this is the sort of thing I could only wish my parents did). Nor does it have to be that often: right now, my counterpart and I arrange “dates” once a month to do something fun with each other. Once or twice a month is just often enough to be special, but not so often it becomes routine.

  8. Alisa says:

    It can be hard to stay on a budget for a long period of time. I like the idea of allowing yourself some “fun money” but then not tapping in to other budgeted areas when all the money is gone out of the fun.

    I just started My Investment Journey and I must also budget in order to be in a position to take advantage of investment opportunities when they occur.

    Be well.


  9. Jules says:

    ‘Doh! I just reread the post and it seems as if Trent addressed that already. Shows what you get for staying up too late…

  10. Sarah F. says:

    Great post, Trent! “Quality time doesn’t have to come from spending money – it just comes from spending time doing something where your focus is on your kids and you don’t have demands pulling you away (like making supper, etc.)” Exactly!

  11. Val says:

    I really enjoyed reading this post. I like when you said “It’s the “spend less” part of the one sure recipe for financial success, spending less than you earn.” Seems so simple but so many times overlooked; you make some awesome points!

  12. Shevy says:

    Having too tight a grip on your budget is like dieting too intensely. You can only do it for so long before you go off the rails.

    It works better to build in some small indulgences along the way but, if you don’t, the key becomes getting back on track as fast as possible.

    I’m sure Trent didn’t intend it that way but, it would be easy to read “inconsistent frugality is wasted frugality” and say that you’ve totally blown it by going out for dinner and getting your hair cut, so now you may as well go out and trade in your car or get a plasma TV.

    If that sounds ridiculous to you, consider how many times someone on a diet has a piece of cake and ends up eating the whole cake and ditching the diet. All or nothing thinking is very common when people embark on diets or budgets.

    Just be gentle with yourself and try to both more careful and more realistic in the future.

  13. km says:

    My biggest threat to my frugality are hobbies that I wish were a business – either full or part time. It’s very easy to justify spending above my budget when I also tell myself buying new supplies or equipment will get me that much closer to my dream. So far frugality is winning this year, but my creative side still resents the limitations my responsible side place on spending in these areas.

  14. kazari says:

    2 thoughts.
    1. if there are particular money saving activities that make you feel poor – don’t do them.
    2. every budget should have a sanity allowance built in. a small amount (mine has been $10 or $20 a week) that is yours to spend on whatever you like. enough for a magazine, or 4 McDonald soft-serves for the kids. or you can save part of it up to have a trip to the movies once a month. but every person should have some – and nobody should be questioned about what they spend it on.

  15. michael says:

    If she really wanted to give the kids what the deserve, she’d go crazy putting all that extra dough into their college funds :-)

    For those without kids, I recommend having your “let’s go blow our extra cash” days on the day BEFORE you get paid. That way you don’t feel guilty, and don’t blow $$ you need for other things.

  16. jake says:

    Growing up my dad was very very frugal, and he didnt hide that fact and made us know it, but importantly he made us understand why.

    To this day i still always close the lights when i leave the room, if i dont, i hear my dad’s voice. i still dont turn on the air conditioning until i cant stand it, even then just for a short time.

    The point is I never blame my dad for instilling such frugal habits, even though I nagged about it growing up. Now that I am on my own, I can really see the returns and it adds up.

    Another side effect of my dad’s frugalness that rub off was that it made me watch my money very very carefully. When I left college the only debt I had was student loans and even then it wasnt that much. I didnt borrow or use one cent from my parents even though they always tell me to ask if I did need it.

  17. bp says:

    If anyone is blaming themselves for not being frugal enough or not working hard enough, they should take a look at this video. It shows how our monetary system really works. Why are we always, always behind, no matter how hard we try? Check it out. I couldn’t believe it when I watched it– it’s incredibly illuminating.

  18. sillygirl says:

    Don’t children “deserve” a good role model from parents of living within your means – it seems to me that’s a very loving gift to give your children.

  19. Quatrefoil says:

    My method of dealing with a genuine windfall is to halve it – half goes to savings or debt repayments, but the other half is ‘fun money’. That way I don’t feel deprived of the feeling of something unexpected and good happening, but I don’t feel guilty about not saving. Generally the fun half is spent on entertainment or buying something I wanted sooner than I’d planned.

  20. charlie says:

    loved the article i am just starting to realize the importance of living within my means. i have struggled with these same problems (i.e. spending crazily when a financial windfall occurs) and wish i would have just stashed the money in my ing account. blogs like these are helping me get on track and provide amazing insight and advice.

  21. Journeyer says:

    I agree that a small allowance for fun spending is absolutely necessary when trying to save. It helps prevent the splurges and can reduce the martyr attitude that can easily develop when we feel we aren’t allowed to do something.

    What children deserve is to have parents that spend quality time with them. I don’t know how many times I’ve bought things for our kids that only get played with for a few days. Now I only buy them toys at Christmas and birthdays. Of course, I buy them clothes as they need them. But in all honesty, what’s the point of a wardrobe full of clothes that only get worn once or twice?

  22. Margaret says:

    I totally feel for your reader about how it seems unfair to the kids. That’s a really hard one for me too. However, I don’t do them any favour by getting them a treat every time we go into a store (teaching them to waste money), or buying them junky toys at the dollar store that fall apart (teaching them that they don’t really need to take care of their things), or whipping out the credit card so that we never have to say “can’t afford it”. Is this how I want them to live as adults? No way. I want them to learn that if they want something, they have to save up their money for it; that money is a scarce resource; that they can deal with disappointment and be grateful for all the other things they have in their life.

    I love the idea of having a fun factor built into your budget. I haven’t done that — it just ends up coming out of the grocery budget, so it doesn’t really get tracked and thus controlled.

    I would hate for my child to have a big opportunity in the future that we couldn’t afford because instead we had frittered away our pennies at dollar stores and fast food joints.

  23. One of my closest friends grew up with a family situation like this. They weren’t wealthy, but they would go out every night for a pizza feast–at the most expensive pizza parlor in town. This included money for games and vending machines, etc.

    I’m sure those nights were fun, but it wasn’t fun for my friend when they didn’t have enough money to send her on school trips (not overnight, fancy trips, just in-town fun excursions), to pay for athletic equipment to participate in team sports, or to pay for college applications.

    Mindy, it’s wonderful that your kids’ happiness is a priority. You can also make them happy by having enough money on hand so that they can enjoy those kind of everyday experiences that my friend often missed out on.

  24. As an ex=dieter, this sounds very reminiscent of the yo-yo dieting many many people get sucked into. You deny, deny, deny, and then when you allow yourself some leeway, you blow it.

    I’ve been thinking of my commitment to saving money like a diet. I know I could try to put every spare penny away towards debt and savings, but in the end I’ll “fall off the wagon” and be back to square one. I think the same philosophy can apply here.

  25. InDebtToo says:

    Excellent post, and very good comments as well. I particularly agree with comments 1 and 2 — I just cringe when I hear the word “deserve” these days.

  26. Along says:

    Just wanted to say I love your blog and I read it everyday. Thanks for all your articles and advice. For that I awarded you with the Arte Y Pico award. Yeah, I dunno what it is either but I hope you like it. If you have the time, details are at my blog.

  27. Liz says:

    Mindy – I think the tone in your post hints at your not really being comfortable with trying to cut back – you say “I get tired of living cheap”. You are not living cheap – you are being frugal – other people who give into every instant “want” are being wasteful – wasteful of their money and in the end wasteful of their kid’s futures since what they spend now cannot be spent later (for college or hobbys). Be proud that you are trying to save – not defensive. You are trying to do the best for your family in the long run. Try not to let the materialistic messages get to you. Like Trent says – when they look back your kids will appreciate time with you *so* much more than the toy of the moment. You have to have faith in this – of course your kids may not understand this now (they are only kids after all!) but they will look back and appreciate it later.

  28. "Mo" Money says:

    The goal should be “plan” for everything even windfalls. And in your budget should be items that are fun, you need to not feel like you are in prison all the time.

  29. Carol says:

    Here’s a story I would like to share: Before I got on the frugality track I did the same as Mindy. My employer awarded me a bonus and I took my three young children out and let them buy alot of new clothes, etc. I then proceeded to *brag* about it to another coworker who was probably laughing to herself because she was pretty financially intelligent. Thinking back about that now makes me really embarrased.

  30. partgypsy says:

    I sympathize with this poster because there have been months where almost all discretionary money was put towards paying off debt. Although it is satisfying getting rid of debt, sometimes it can be tedious (as Ramsey says putting) giving a name to every dollar. I find I get almost as much fun with little purchases (barrettes for my daughter, going out for tacos) as I do for larger or expensive purchases, and gives one a way to enjoy one’s money while still keeping to a budget. Just make sure you have clear (hopefully somewhat ambitious) financial goals. As long as you are meeting your goals, don’t feel too bad.

  31. Melissa says:

    The one thing my mother said before she died seven years ago that hit home with me was, “I regret not having spent more time with my children.”

  32. It is so tempting to splurge or use that extra income to take the family out for a treat. I agree that setting up an entertainment budget category can help organize this spending. It is tough, and you want to give your kids and family a special treat once in a while. But, your kids will be so much better off, if you can consistently pay your bills and not argue or stress over finances.
    So many wonderful fun and free things we can do with our children. My kids love the park. Pack a lunch and just hang out. Absolutely free.

  33. Erin says:

    @ Mindy
    The word “deserve” didn’t jump out at me, as I totally understand the impulse to give our children everything they want. What jumped out at me was “unfair” – that makes me think that you simply are not happy with the way your money management is affecting your lifestyle and, most importantly, your relationship with your children. It sounds to me like, while you are saving money, you still have an intensely emotional view of the power of money; it’s hard to wise with money when your feelings about it are so strong. I agree with Trent that inconsistent frugality is wasted frugality, so I think it’s best to find a level of savings that YOU are consistently comfortable with, even if at the beginning that amount is not high; my guess is that once you realize on an emotional level that you have power over money, and not the other way around, you will be able to save more easily.

    @ Kacie
    You might also look into G Diapers as a middle ground – they are basically cloth diapers with a disposable (even flushable!) insert. It minimizes the amount of waste you put into landfills and the amount of laundry you have to do. I guess I’m in the minority when I think that cloth diapers are probably feasible in your situation, though – yes, newborns are demanding, but a useful secret to know is that nursing a newborn in a sling while taking a short walk is pretty much guaranteed to put them to sleep ;-) Even that walk down to the laundry room might be a much-needed energy boost on the days when you can’t even think about washing your hair, Congratulations!

  34. Peter says:

    Just keep in mind, what you show your children is as, if not more, important than what you tell them. You are showing them that every time they get a little extra money, they need to spend it on a good time or for something “fun”.

    It doesn’t matter what you feel, this is what you are showing them.

    There is nothing wrong with doing this occasionally. However you may want to think that another message is taking a portion of it for the fun, or show how they can take some of it and save (budget) for something better down the road.

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