10 Habits of Frugal & Debt-Free People.
Webster defines frugal as "behavior characterized by or reflecting economy in the use of resources." The opposite of frugal is wasteful. Wasteful is defined by a lifestyle marked by lavish spending and hyper-consumption. - The Millionaire Next Door
After reading countless books on frugal and debt-free people, as well as a few YouTube videos on other blogs, I complied a few common-thread habits that most of these Frugal People advise others to do. Their recipe for success, if you will....
1. They do not buy new cars... and they almost NEVER lease a car. That's right.... they usually capitalize on someone who leased and returned a car. So they buy a car that is a few years old, well maintained and has already taken the biggest hit of depreciation. Also, they do not change cars often. They usually save for a car, purchase with cash and then keep it for the long term.
2. They pick up change in the parking lot. Yup. Simple, but they do it. Frugal people recognize the value of ALL money. They do not consider themselves "too good" to stop and reach down to grab some loose change off the sidewalk.
3. They do not toss around the word DESERVE. Frugal money-conscious people do not justify purchases that they can not afford by telling themselves "they deserve it." I heard Dave Ramsey say ... "we all work hard!... go home and make dinner and stop whining about it." People justify putting a vacation on a credit card saying that it'll be "good for their marriage." Debt is never good for a marriage. Frugal people research, assess the costs, and save to pay cash for anything they want to do.
4. They understand the difference between frugal and stingy. Typically, frugal people are some of the most generous and biggest contributors to charities big and small. Why? BECAUSE THEY CAN. Broke individuals can not give because they barely have anything left after the pay all their bills.
5. They purchase inexpensive clothing. People who are frugal tend to view retail costs as a waste. Same concept applies to their clothing. Frugal people are seen thumbing through the sales rack, shopping with a coupon in hand and frequent consignment sales and thrift shops.
6. They do not eat at restaurants often. A family that eats out a lot is actually a sign that they are not doing well financially. Counter-intuitive in our culture, but research has found it to be true. People who are rich are savers. People that frequent restaurants often as not usually savers.
7. They do not talk about money. A person who takes the time to tell you what they spent on something tends to be a person who actually has nothing in the bank. They hyper-consume in the hopes of impressing other people. Again, they are not savers, and therefore are not even close to rich. They are typically some the people with the most debt looming over their family.
8. They do not shop for recreation or entertainment. Frugal persons stay out of shopping malls and stores unless they are going in for an actual purpose. They also go shopping with a list, a budget and do not buy impulsively.
9. Frugal families usually have a mom who stays-at-home. Again, completely counter-intuitive - but, according the the 25-year research done by Thomas J. Stanley, Ph.D. & William D. Danko, Ph.D. a stay at home mom is a common-theme in American homes where a couple retires as true millionaires. In this case, the wife is usually even more money-conscious than her frugal husband and the two of them work as a team to stay away from debt and save. They usually have a paid for home, enough savings to put their children through college and retire with ample savings to live a nice retired-life. (The Millionaire Next Store).
10. Possibly the simplest but most important attribute of all frugal people is that they have a WRITTEN BUDGET every month for everything. No exceptions. Their money works for them. It does not work against them. They do not sit down at the end of the month wondering how they will manage. They are out of debt. They stay away from debt.
The majority of my findings came from Dave Ramsey's Total Money Makeover, Chris Hogan's Retire Inspired, Jonni McCoy's Miserly Moms and Stanley & Danko's The Millionaire Next Door.
