Frugal lessons can help you make the most out of your financial resources. If you really want to start living a frugal lifestyle, you can find a lot of role models out there. It is just a matter of finding the right person that you will emulate.
Believe it or not, a frugal budget can help you improve your finances exponentially. If you want to increase your net worth, you can accomplish that faster if you live frugally. Here’s how it works.
The key in growing your finances faster is to invest your money. It is simply putting your money where it can earn you profits through interest gains. It is like making your money work for you. But to be able to invest, you need to free some money from your budget so you can invest it. This is a problem if most of your income is being used for expenses and also to pay off your debts. How can you free some money from your budget if it is already allocated to various spending categories?
The answer to that is to live a frugal life. You need to lower your expenses significantly so you have the extra money to invest in stocks, bonds, and other accounts.
If you doubt the ability of frugality in growing your finances, you need to get to know the Debt Ninja. He is the person behind PunchDebtInTheFace.com. If you are wondering why he adopted the name Debt Ninja and named his site as such, he gave a very simple answer: he owed some debt and he wanted to punch it in the face.
Here’s the simple story of the Debt Ninja that can give you various frugal lessons. He started out with $28,000 worth of student loans and he held a job with the government – which meant he is not earning a lot of money (only $38,000 a year). When he proposed to his girlfriend, he knew that he did not want to bring his debt into the marriage. He and his wife made a commitment to live below their means so they can improve their finances before they got married.
And guess what? After a few years, they went from a negative $28,000 to being worth $400,000! Their secret? It was a combination of a lot of things actually.
First off, Debt Ninja paid off his debt fast – 2 ½ years of $28,000 student loans. They also contributed to their retirement funds, saved for a down payment ($100,000 in 3 years) and managed their money wisely. Guess how they did that? They lived well below their means.
That is what frugality can help you accomplish. Frugal living is all about spending only on what is important and not being extravagant – even if you can afford it. If the Debt Ninja can reach a net worth of $400,000 at a young age, it is possible for you to get that too. Take note that the Ninja and his wife achieved this without the help of a generous monetary gift or inheritance. All of it was caused by proper financial management and of course, frugality.
Known frugal celebrities and what you can learn from them
Apart from the Debt Ninja, there are other people who can help you with frugal lessons. Believe it or not, a lot of celebrities can give you some relevant pointers about this. When it comes to influence, we all know that celebrities can be quite influential.
According to a study done by MedicalDaily.com, those who showed interest in some celebrities get a feeling of belongingness and a sense of community. Although idolizing these celebrities too much can be harmful, it can also bring about a positive effect in the behavior and emotional well-being of an individual. If you happen to look up to celebrities with great financial qualities, then that can have a positive impact in your financial life.
Having said that, here are a couple of celebrities that can teach you a couple of frugal lessons.
Tyra Banks: Opt for freebies.
This supermodel has successfully built an empire in the modeling industry. Thanks to her reality shows and various endorsements, this is one celebrity that is worth millions. But if you think that her wealth will make her turn down freebies, think again. When she stays in hotels, she still gets the free toiletries that is included in the room rates. Do not look down on the free items. If there is a way that you can get something for free, go for it.
Jay Leno: Do not be quick to increase your expenses as your income does.
The next celebrity who can teach you frugal lessons is Jay Leno. Although he may be known to splurge on luxury vehicles, there are a lot of expenses that he holds back on. When he started hosting “The Tonight Show,” he made a conscious choice to not spend his salary from NBC. He chose to continue living on the money he made through this standup commitments. This is a great lesson for you to learn. When you get an income increase, do not be quick to upgrade your lifestyle. As long as you are not living in poverty, you can choose to invest or keep that money instead so you can afford an early retirement.
Sarah Jessica Parker: Know what you will buy used.
The Sex and the City star teaches us that not everything should be bought brand new – even if you can afford it. Sarah Jessica Parker relies on hand me downs for her kids. According to her, she does not want her kids to grow up feeling they are privileged. Although that is the reality, she does not want them to rely on what she and her husband have built on. While you will not rely on second hand all the time, you need to know the times when it is smarter for you to buy used items.
Paul McCartney: Just because you are rich, those around you should get a free ride.
Although you may want to share your blessings with other people, you have to hold yourself back. Spoiling them will not really do them any good. If anything, it might make them reliant on you – which can be destructive and unproductive. This is a lesson that Sir Paul McCartney can teach you. Although he is worth hundreds of millions, he let his daughter pay for her own post-secondary education. When he is with friends, he usually lets them pay for their own drinks. Even if he can afford it, he does not pay for the tab of those with him.
Leonardo DiCaprio: Give back to charity.
Finally, this is another celebrity who can teach you great frugal lessons. This person lives frugally simply because he wants to be able to give more money back to the community. While this will not really help you improve your finances, it will help improve your well-being.
You can really get a lot of lessons from these celebrities if you want to live frugally. Find someone that you admire and see how they are doing it. Deciding to live a frugal life is easy. Living it is another story. If you are sure that you want to pursue a frugal lifestyle, it pays to have someone to emulate. It makes the adjustments easier.
Frugal skills that you should learn for next year
Frugal living is all about deciding not to spend your money on unnecessary things and expenses. You can research all the personal finance quotes about frugal living but living them is a different matter. Take note that you are not going to be cheap about it. There is a difference between being cheap and frugal. Frugality is when you choose not to be extravagant and focus your finances on the expenses that are important to you and will improve your overall well-being.
One of the characteristics of being frugal is doing things on your own. Instead of hiring someone to do something, you will try to do it yourself. Although there are tasks that are best left with a professional, it does not mean these are skills that you cannot learn. For instance, instead of hiring someone to paint your room, why not allot a weekend to do it yourself? You can save a lot if you do this. You can invite a friend to help you out and this can be a great way for you to bond.
According to HouseLogic.com, there are certain DIY projects that can really save you a lot of money. Based on the article published on the site, refreshing your bathroom can cost you $10,000 – and that is for minor work. If you learn how to do it yourself, that $10,000 can go somewhere else – like your savings. Other tasks that you can learn to do yourself includes installing a new steel front door, new wood flooring, and even an upgrade in your insulation. Most of these tasks will only get you to spend around 25% – 33% of the cost that it would take if you hired a professional to do it for you.
Of course, it is impossible to learn every DIY project that you will need. But here is a list of DIY skills that you can learn and will be very useful several times.
Maintaining your car. This involves tasks like changing the oil in your car or a flat tire. These are simple tasks that you can do yourself. Just be sure that you have mastered them because failing to change a flat tire correctly can lead you into an accident.
Sewing and mending clothes. This is easy. If you can learn how to sew your clothes or mend buttons and holes in your wardrobe, that can save you a lot. In fact, if you are creative enough, you can probably alter last season’s clothing and accessorize them so they appear new the next season. This will also save you a lot of money on children’s clothing. Instead of buying, you can probably make them yourself. They grow up fast anyway so spending a lot on their clothes can be a waste of money.
Grooming your pet. This can easily cost your hundreds of dollars a year. If you learn how to trim the nails of your pet, cut their hair or give them a thorough bath, you can allot the money on something else that your beloved pet will enjoy.
Cutting and styling your hair. You should also learn to cut your own hair. This is especially true for guys who get to have a haircut more often than women. At least, this is true for those who want to keep their hair short. This will also save you a lot of money each month.
Cooking your meals. Finally, you can save thousands of dollars if you cook your meals at home. Not only is it more economical, it can be the healthier choice for your family. If you do not have the time to cook every day, you may want to just cook big meals every weekend and heat them before eating.
Apart from the frugal lessons you can learn from celebrities, these skills will help you apply frugality in your daily lifestyle choices. Here is a video from National Debt Relief that will aid you as you live a frugal life.