Financial Tips that Don’t Require You to be Frugal

We’ve all seen the very “helpful” tips online where we are told that we simply needed to stop buying $5 Starbucks Lattes every day and that’ll automatically add up to an extra $150 in or pockets. We are also often told that we needed to be more “frugal” in order to save money. In some way, I think these kind of advices are genuine, but lazy. For example, most people are not buying $5 Starbucks Lattes every day; and what is living if we’re not going to put limits on how we enjoy live based on financial constraints. That’s why rather than being frugal about spending, I’d rather try to be more conscientious (or “smart”) on what/why I am spending the way I do.

Opportunities for Smart Spending

1) Cars

Some people love cars, while others simply need a vehicle to get from point A to point B. For people that care about what car they drive, you don’t have to limit your options based on the notion of “frugality”. At the same time, you also don’t have to get into tremendous debt to drive the car of your dream. Getting into tremendous debt to buy something you want is usually a “not smart” way of spending money.

So how do we be smart about buying a new car?

Short answer. Don’t buy a new car off the lot, buy the same car elsewhere.

Longer answer. Pick the car you want to drive, but can’t really afford. Now look for one three years old that is just coming off of a lease. The price of this car will usually be at least half the price of the brand new current model from the dealer. As you likely have heard, cars depreciate in value as soon as it leaves the lot. Buying a car this way will allow you to drive your dream car at a price that you can afford.

2) RV’s

Some people dream of going on an RV adventure. In reality, however, buying and venturing off with a nice RV is beyond what most people can afford. Think about the cost per year of depreciation, interest, storage, maintenance, and gas costs. Ask yourself what about buying an RV appeals to you for your travel?

There are a couple ways to tackle this in a financially smart way. One is to find a used RV (similar to how we would buy used cars, except the market for RVs is slightly different) and then sell the RV after your adventure. Let’s say we bought a nice RV for $100,000 and then we want to sell it after one year. We might be able to sell the unit for $80,000 in that time period. This would mean that our total cost of owning the RV was $20,000 (depreciation + interest). It’s better than holding onto the $100,000 vehicle, but $20,000 for an adventure is still pretty pricey right?

The other smart way to think about is to simply not get an RV. Really think about what is it you are after for you travels, and consider an alternative approach to how you might enjoy travel. Instead of spending money planning and executing an RV trip, how many independent vacations can you go on with that money?

Reframe what your ideal travel looks like, and see if there is a financially smarter way to reach your goal!

3) Stuff – TVs, Watches, Clothes, and Anything Else You “Need”

Buying things things for yourself should also be a conscientious decision. It’s a good idea to avoid impulsive purchasing behavior. But how do we identify less-than-smart purchasing behavior?

Something I really agree with Marie Kondo on is to always ask yourself whether something “is giving you joy”. Take it further, think how long that thing you’re about to buy is going to give you joy, and what are you going to do when it stops giving you joy? I found that taking a moment to simply ask that question really helped me with impulsive or therapeutic shopping.

On the other hand, you can also think about value. How much “value” you will gain from buying that TV, watch, clothes, etc. If it’s a large TV that will serve as the foundational piece of your gathering – yea, the value of the TV just went up and it would be a “smart” decision. However, if you hardly watch TV or really won’t notice the difference of a smaller TV, then the value of that TV to you isn’t that great and buying an extra large TV just for the temporary satisfaction would be a not be smart decision.

The same goes for trendy clothes or jewelry. How much value will you gain for yourself (perhaps in measure of “joy”) if you bought that item. Can you return it afterwards?

You don’t have to be frugal on buying stuff for yourself. Just be smart and conscientious about each purchasing decision, and notice how that will impact your behavior and your wallet.

4) Alternatives

Sometimes we buy things that are expensive when there are equivalent products that are either free or much cheaper. Let’s take the example of your everyday breakfast lattes and bagels and going out for weekday lunches.

While I love the ambiance and experience of a nice cafe for breakfast or lunch, I really don’t need that experience every day. Sometimes I just need a bagel and a coffee on-the-go because I’m late for work. Sometimes I just need to stuff myself with a sandwich to not feel hungry in the afternoon. I’ve also gone through a period where I bought a case of Soylent to drink as my lunch because I simply didn’t need to enjoy a nice lunch during busy workdays.

Do you really need to go to a bar by yourself for a $12 glass of wine after work, or would you be just as happy buying a $12 bottle of wine to enjoy at home? Sometimes you need the ambiance and experienced from a restaurant/bar, but other times it’s just a bad habit that’s costing you money you really don’t need to spend because you have alternative options.

Again, I’m not telling you be frugal, but be smart. Understand what makes you happy, and what satisfies your needs. Then figure out if there’s an alternative way to reach that same goal that could be cheaper – without compromising on quality.

5) Trends -Clothes, furniture, accessories

I don’t skimp out on high-quality, long-lasting items. When it comes to clothes, furniture, and accessories, I always look for things that our pretty neutral, timeless, and well-made.

Most trends fade and change quickly. It’s not “smart” to simply follow the hype for the sake of it, because the hype of a certain purchase may last only a few days or months. One of the most annoying feelings after a purchase is buyer’s remorse. Be smart about “trendy” purchases.

If you think about it, there are many trends that have been categorized as “timeless” because it never goes out of style. A study leather boot, a nice pair of jeans that you can wear for years, a simple watch with leather strap, and other classic items are great purchases to being stylish as well as being smart with your money.

Another great tip to looking fresh is to buy things that can be mixed and matched well with other items in your arsenal. Every combination of different items would be a new “look and feel” so that you have more options to be trendy without having to reach into your wallet.

Bottom Line

Don’t be Frugal, be Smart.

Be smart with your money. Understand the needs you have, understand what makes you happy, understand when people are charging you a premium for a benefit that you really don’t need. Then find cheaper alternatives to getting it done without compromising on quality of life.

Many people burn through money without ever stopping to think where it’s all going.

People that are “wealthy” often define wealth by their own terms and are very conscientious about where their money is going. Look for ways to minimize the useless drain on your wallet without minimizing what’s important to you. Learn to find contentment in what you have and can afford, instead of always chasing new things.

Being smart about money is a mind-set. It doesn’t require you to be cheap, frugal, and filled with self-sacrifices. If you are honest about yourself, your needs, and your goals, then you will start to hopefully see that money should never be a limiting obstacle in your happiness.