The Four Phases of Frugality

In Need of a New Wallet by somegeekintc on FlickrI have not always been frugal. In fact, there are times now where I often feel less than frugal, as I occasionally make an impulse purchase or indulge in something that isn’t exactly frugal. But hey, I’m human.

What I have noticed over the years is that our frugality has gone through very distinct phases, nearly coming full circle (but not quite).

We’re Deep In Debt – Time to Cut ALL Spending

A few years ago we found ourselves deep in debt, and decided we’d had enough of sending our paycheck to banks and credit card issuers. I returned to my frugal roots (which I’d lost for much of my 20s, or as I like to call them, my “Spendthrift Years”).

We instantly recognized that to reduce our debts we had to work on both sides of the equation – income and outgo. I also recognized that I couldn’t instantly boost the income side of that equation, but we could make a significant dent in expenses. And make a dent we did.

We canceled the cable. We stopped eating out. We stayed out of stores, movie theaters, and anywhere else that might try to separate us from our money. To us, that money represented something very precious – a debt payment – one step closer to debt freedom.

OK, We Still Have to Have SOME Luxuries

That first phase lasted a good six months. We made significant progress towards debt freedom in that time. Then life happened. My mom had a devastating illness that rattled our family, and after a year of grueling rehabilitation following a stroke, she died at the age of 53. Relatively healthy one week; then in the hospital for 102 days, and rehabilitation for months to follow.

It was a life-altering event for all of us. For me, it was a reminder that life was short. I began to question our radical spending cuts. We weren’t having much fun. The kids missed their favorite television channel. My wife and I missed the occasional dinner out as a break from the routine of cooking and cleaning. We all missed taking an annual vacation (which we had skipped a couple years in a row throughout the ultra-frugal phase).

I felt like a big, mean, financial ogre ruling over the household with an unyielding zeal for frugality.

So, we decided to loosen the tight grip on our finances, just a bit. We did ultimately reach debt freedom, but it probably took a little longer than it would had we continued our Spartan existence.

Debt Freedom – Ready to Spend Again

Once we reached debt freedom, we went a little bit nuts. Seriously. We made up for our lack of vacations with a trip to Disney World – the first for our kids. There wasn’t very much frugal about that trip, but we decided our first visit would be a fun one without much consideration to costs. Admittedly, this strategy was not financially smart in hindsight.

In the coming months we also did a little clothes shopping, and spent money on a few other things that had been put off for months (even years). I’m not proud of that time, because looking back, it was sort of antithetical to everything I’ve written here at Frugal Dad. Again, what can I say, I’m human.

That Was Fun, Now Back to Frugality

I guess the major difference in the old me and the new me was that this time around it was much easier to recognize my spendthrift ways and get control of them. Rather than putting everything on a credit card (which has a way of really adding up), we decided to go back to an all-cash basis, with the occasional debit card purchase.

We took a more frugal vacation this fall, spending a week in the mountains and enjoying the peace and quiet (a much different setting than Disney). We clip the occasional coupon, order water with our meals and split the occasional entree. We’d rather stay in and watch a movie than go to the theater. We look for sales to proactively buy seasonal clothing for the kids. You know, the little frugal moves that don’t cause much pain, but still help keep that expense side of the equation from creeping up to high.

I’ve learned many lessons over the last few years, but this last one was the most important. Being able to recognize when you are off track and make small course corrections is really a key to financial success.

The old me would have never recognized I was off track, and if I did, I would have just floored the accelerator into the nearest wall. I lacked the financial maturity (and I’m not referring to age) to keep myself in check.

So I’d encourage you to celebrate milestones, like reaching debt freedom, with a little spending splurge. Do something you’ve been longing to do, but put off because you were in debt.¬†Upgrade an item or two around your home that adds value to your life.

Should that spending slope begin to feel like a slippery one, remember what it felt like to be in debt and adopt our family motto, “Never again!”

Leave a Comment

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>