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My Financial Independence Journey » Reflections » Frugality is Just a Tool – Nothing More

Frugality is Just a Tool – Nothing More

1181394_tools_and_euroFrugal habits take many flavors, kind of like ice cream.  There is the do it yourself (DIY) approach which focuses on making your own clothes, doing your own home and car repairs, even making your own laundry detergent.  There is the bargain hunter approach which wield coupons, shopper club cards, and weekly sales like some kind of a money saving Navy Seal. Then there is the haggle and negotiate approach, which emphasizes debating the price of everything, even a box of corn flakes, if it it will save you money.

There is always a frugal habit to fit your personality, you just have to find it.  But oddly, I’ve only had the misfortune of running across two basic frugalist archetypes during my journeys across the internet.

Frugalists, people who practice frugal habits, seem to appear (at least online) in one of two basic flavors.  Kind of like ice cream, if ice cream only came in chocolate and vanilla.  First there are those who were reluctantly forced into frugality.  “Well crap, I need to pay off these credit cards, better find a way to cut back.”  Then there are the philosophers who spend their time espousing frugality as a path to happiness.  “My minimalist lifestyle brings me unbounded happiness as I am free from material want.  And the fact that I’m helping the Earth by not raping it’s resources gives me a warm fuzzy feeling inside.  Kind of like I swallowed a kitten.”  Yes, that was sarcasm.  I’m rather good at it.

As should be evident from the title of this post, I don’t connect with or agree with either of these kinds of frugalists.

First off, we need to get something straight.   Frugality is absolutely essential if you want to achieve financial independence.  So you’re going to have to suck it up and get used to it, especially if you want to pull off financial independence in a relatively short period of time.

Why These Archetypes Don’t Fit Me (and may not fit you either)

I’m not forced to be frugal.  Back in my grad student days, I was.  But not now.  I make more than enough money to buy whatever I want, whenever I want. iPad? No problem.  Luxury sedan? No problem.  A round for the house?  I got you covered.  But yet, I don’t actually buy all this crap.

I’m not going to tell you about how not consuming has somehow made me happier.  Honestly, it hasn’t.  I like having things.  I like buying things.  And expensive and trendy things provide me with much needed social status.  I’m not going to pontificate about how my lifestyle is saving the planet.  I don’t really care that much about global warming, peak oil, or whatever eco-issue I’m supposed to be ‘aware’ of this year.  Yes, that was more sarcasm.  I certainly don’t make my lifestyle choices based around them.  But yet, I still make a point to save and invest my money, rather than buy crap.

I’m not even an early retirement aspirant.  I like my job.  I like my boss.  I could do this for 30 more years.  But yet, I’m hell bent on achieving financial independence. In order to do that I need to save money, which by default indicates that I must avoid buying crap.

Frugality is a Tool to Achieve My Objective

My primary financial objective is to achieve financial independence, sooner rather than later.  Since I don’t have unlimited income, I need to find ways to free up more cash so that I can direct it towards my brokerage account.  That’s it in a nutshell.  I made a choice to aggressively work towards financial independence.  And in order to do that, I need to break out the frugality.  If I made a different choice, such as trying to retire at 65 like everyone else, I could be a lot less frugal and live it up a lot more.  Only time will tell if my choice was a wise one.

Frugal Habits and Me

Let’s finish this post in the same fashion that we began it, with a discussion of frugal habits.  I’m not much of  DIY person.  The things I’m good at doing tend to be highly academic and scientific.  I’m not so great with house or car repairs.  And anything remotely crafty is going to wind up as an unmitigated disaster.  I bargain hunt when I can, but bargain hunting it’s not my thing.  I really hate going to three different grocery stores just to save a few bucks per week.  I’m not a haggler either, although I’ve had some success trying to negotiate prices in the past.  And I’ve had some failures.  Overall, I find it too stressful.

So then, what kind of frugal habit do I have?  My focus is on the deliberate and conscious allocation of my money towards things I care about and away from things that are less meaningful to me.  The profit from this arbitrage is what makes it’s way into my brokerage account.  I’ll talk more about my philosophy in future posts.  So stay tuned.

Readers:  What frugal habits fit your personality?  Do you consider yourself forced into frugality or do you have more of a philosophical take on your frugal lifestyle?

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40 Responses to "Frugality is Just a Tool – Nothing More"

  1. Headed Home says:

    Interesting take on frugality. I’ve never thought of it as a tool. Based on this viewpoint, would you say you plan to be less frugal once you reach FI?

    1. Headed Home,

      Ideally, I would become less frugal as my degree of financial independence increases. Once my investments can pay off all of my yearly expenses, everything above that is gravy, so I should be able to increase my spending to account for it.

      But realistically I was raised by cheap parents. I’ve been frugal my whole life. I’ve got probably another 10 years of frugality to go in order to achieve financial independence. Those habits will be very hard to deviate from.

      1. Steve says:

        I have also been frugal my whole life, whether I needed to or not at the time. It seems to me you set up a strawman of “all those other people are frugal for one of two reasons” and then gave your own, third reason for being frugal. But then here in the comments you admit that it’s actually a fourth reason. There are perhaps as many reasons for being frugal (or not) as there are people; but also I suspect that few of us break out of the molds that our parents raised us in.

        1. Steve,

          Thanks for stopping by. I think a portion of my frugality is due to my upbringing. But a sizable chunk is due to my own decision to aggressively pursue financial independence. If I wasn’t pursuing FI, I would probably just max my 401K and spend the rest. There’s a whole list of things I would love to buy and do, but choose not to in favor of savings.

  2. Mike says:

    Excellent post. Describes me as well.

    1. Mike,

      Thanks for stopping by. Makes me feel good that I finally met another person with a similar outlook on frugality.

  3. Integrator says:

    I definitely used to be more frugal. I’ve really lost some of that edge since I got married and had kids. Now, I’m happy to pay a slight premium and enjoy some of the convenience. The nature of things that I’m frugal with has changed over time as well. Clothes and even food to some extent used to be an area of frugality when I was single. Its not any more. We spend big on anything to do with the kids items as well and don’t skimp there. I guess thats why parents are such good targets for marketers!

    1. Integrator,

      I would imagine that my spending habits would change if I got married and had kids.

      I’m pretty sure that I would fall on either extreme if I had kids. Either they would get everything they ask for, since I’m a pushover. Or they would get nothing, since I didn’t have that stuff when I was a kid and they should be studying anyway.

      1. greg says:

        I personally find that my parents giving me a few expensive things every now and then when I was younger kept me from wanting them now – when my personal goals are towards FI. ie. A trip to Europe MANY years ago, ownership of a non-shitty musical instrument, a good computer, etc.

        Someone close to me seems to be reaching out for such experiences simply because they never had them … at the expense of expressed concerns about immediate finances >_<

        1. Greg,

          Thanks for stopping by. I’ve seen people who were deprived in their youth go both ways. Some spend everything they have and others hoard everything. Oddly, I think my grandparents, who were raised in the depression, probably have the most balanced outlook on spending.

  4. says:

    My motto is to spend on the things that really matter to me and to save on the things that don’t. The balance seems to work well.

    1. Miss T,

      Thanks for stopping by.

      I agree with you wholeheartedly. But finding that balance is particularly challenging for me. In part because as I’ve matured over the last decade from being a college student to being a needlessly educated professional, what’s important has changed so much that it’s hard to keep up and adapt quickly.

      I imagine that this difficulty will remain for me as I’ve still yet to encounter several of the standard life changing milestones (marriage and kids).

  5. says:

    I agree. Sometimes the extreme frugal practices like measure the amount of toilet paper makes me roll my eyes, but I figure those people will see me as very wasteful. So it all comes down to “personal” finance. My general frugality is to cut ruthlessly on things that do not affect us much and splurge on things that gives us maximum enjoyment. In the last 5 yrs our priorities have changed dramatically. I am assuming it will change again when we (1) buy a house (2) start a family. Some priorities like charity will always remain the same. As long as it doesn’t affect anyone else (if it does I call this cheap) and people are happy with their practices everything is fine.

    1. Suba,

      I cut pretty ruthlessly over here too.

      I think that things will probably change when/if I ever get married or start a family. I would hope that buying a house would have a positive overall effect on my finances. But so far, I’m not convinced that buying a house is a great idea for me at this time.

  6. Pauline says:

    I am a selfish kitten swallower (apparently it’s not a word, but I can’t find the proper one!). I appreciate nice stuff and don’t care too much about my impact as a human on the planet, but do not want to work more than I have to for things that would go to waste. I’d rather spend on what I need, and do splurge on nice things that I get value out of.

    1. Pauline,

      I’m with you on this one. I’m really trying to focus my spending on the better things in life. The one thing that I hate about living in a high cost of living area is that so much of my money gets diverted to the necessities. But I have a great job that pays well, so I am very thankful for that.

  7. mysticaltyger says:

    Ultimately, the motivation for frugality doesn’t matter as long as you can execute.

    1. Mystical Tyger,

      Thanks for stopping by. Correct, the motivation doesn’t really matter as long as you can execute. But one thing that I hoped to do was offer a form of motivation that was a bit different than the more popular motivations out there. Ultimately, if you’re not motivated by the arguments presented, you won’t follow through.

  8. [...] certain core elements central to our ability to be productive and happy.  In a previous post on frugality, I mentioned deliberately and consciously allocating my money towards things I care about and away [...]

  9. I prefer to be frugal to have as much of a gap as I can to invest towards reaching early FI. Travel is one of my favorite things. My wife and I are planning a road trip to see one of my friends and then one of her friends this summer hitting DC and then Nashville. That will be a great trip. I’m like you where things that I don’t get much enjoyment out of don’t get my money. It truly is personal finance so to each their own, frugality is the way to reach independence however.

    1. JC,

      Frugality is the only way to reach financial independence, outside of being a trust fund kid or winning the lotto.

      One thing that I try to do is to emphasize the personal aspect of personal finance. I make lifestyle decisions that are good for me, but may not be so good for others. I also expect that the personal aspects of my finances will change over the course of my life. I’ve only recently hit the point of having a real job. If I’m lucky, I’ll be able to cross off the marriage milestone sometime in the future.

  10. I don’t necessarily consider myself to be frugal, I just think to myself sometimes “how could I spend less money on this?” Or “do I actually need this?” These two thought processes drive all of my savings. It’s so engrained in my mind that I don’t even realize that I’m thinking these things most of the time.

    1. “Do I actually need this?” comes up a lot for me.

      The question of could I spend less, not so much. Having recently moved to a much higher cost of living area, I’m still adjusting to the fact that everything costs way more than I’m used to paying. I’m still trying to figure out a good baseline for cheap for this area.

  11. [...] post on frugality being just a tool got mentioned by Retire By 40 in his blog [...]

  12. kathryn says:

    You are right. Frugality is a tool, and it allowed my husband and I to retire at 46 & 50.We raised 4 children on a factory worker’s income and paid off a house.One parent was always home. Using the equity we bought lots of rental properties, and put in many hours. When the children left home, we travel about 8 months a year in Australia.
    We bought a used campervan, and also housesit. We are still very careful with our money and average about $12-$15k a year to live.
    We never see being frugal as denying ourself anything. It makes us more creative. If we want something, we just try to figure out a way to get it free..or close to it.

    1. MFIJ says:


      Thanks for stopping by. You really made impressive progress to be able to retire so early. And having one parent stay at home is great. Was it full time taking care of the kids or were you working on the rental properties or some other side job as well? My parents were pretty frugal, but they both worked full time.

      1. kathryn says:

        While I was home full time with the kids, I also took care of a couple of neighbour kids.During the time when the chidren were little we concentrated on paying off our home. They were all mid teens by the time we spread out to rental properties.
        Being able to access the equity in our home, allowed us to use this as downpayments for other properties.
        When you first start with rental properties, you dont make any money, because you keep reinvesting it back into the business.

        1. MFIJ says:

          It’s great that you got to spend your time with your children. And taking care of other kids sounds like a good way to bring in extra money.

          When you got into rental properties, did you do all the maintenance yourself? Or did you hire a property manager?

          1. kathryn says:

            My husband is very handy and can do most of the maintenace himself. I help paint and clean up between tenants (and there is rarely a clean place when they leave).We have a good relationship with a plumber and elctrician and carpenter, when we need to bring them in.
            No one cares more about your properties than you. We have concentrated in 2 towns which are 100 kms from each other. You need to understand the residential property rules for your province, because they all different.YOu need to follow them to the letter and not be afraid to make an appeal when you feel the Director has made an error.
            Now that we travel 8 months of the year,we have 2 sets (husband & wife in each town) who we use as property supers. They work under our instruction, and we keep in daily contact via email.It’s important to have people you can trust.We return each summer and give them a vacation.
            Property managers are completely different, as they have many properties to service other than yours.Our supers only work for us.

          2. MFIJ says:


            Thanks for the detailed reply. I can attest to the difference in property managers from the point of view of a renter. I’ve been amazed at just how little some of them cared about finding tenants or taking care of the property. Others have been exceptional and really nice people to boot.

    2. Marissa says:

      Kathryn that’s amazing! Decades of frugality and it paid off well! I would like to see myself in your shoes in the future. And yes, resourcefulness and creativity comes out like an instinct when the need calls.

  13. Jim says:

    Well for me frugality is a mindset; it is the quality of being practical and taking control of our finances. Being frugal is all about making the most of what you have. Thanks for sharing new perspective.

  14. [...] portion of those wants cost money.  Sometimes a lot of money.  When I wrote previously about frugality, I mentioned my philosophy of deliberately and consciously allocating my money towards things and [...]

  15. [...] before, I’m not particularly fond of extreme frugality.  I’ve also mentioned that I prefer to make thoughtful decisions about everything that I’m going to purchase.  One of the factors that goes into that [...]

  16. Untemplater says:

    I have fun being frugal. I’m happy when I need something that I have a coupon for and anytime I can save money.

  17. Interesting perspective here. I see frugality as a tool and fun game. I don’t quite fit the boxes you painted though, at least completely. I wouldn’t say we were forced , but labels by others have us in the working poor category. My husband works a fulltime minimum wage job ( living in very rural area, jobs are scarce but rental cost extremely cheap)’ I stay home and homeschool the kids. We spend less than earned. I do care about the earth ( being a country girl my whole life), and about the foods we eat ( New interest when first in history of huge family to get cancer) we have always gone without gov assistance until recently when I was diagnosed with Stage IV breast cancer and became bed ridden overnight on deaths door. I am getting better and all ready have plans to get us off food stamps and raising at least 80% or more of our own food. I am an extreme frugality by nature because I enjoy it, our focus is not on material things but deep connecting relationships and living joyfully. However not minimalist. I am not a fluff bunny, it is just the tool I use to live the life we want. We even have plans to ride horses across USA in 3 years!

  18. Troy says:

    For me, frugality is a matter of principle. It’s my way of remind myself that I’m still that same kid from that small town, and don’t you forget it. I’m not going to start spending lavishly, even if I can afford it. I don’t want to forget my roots and forget who I am.

  19. [...] have always been a frugal individual and an aggressive saver.  Certainly this has benefits.  The more I save the less time it takes to [...]

  20. [...] is just a tool for saving additional money. Almost all of us can find ways to save a bit more more money.  And [...]

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