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Old 12-10-2013, 11:57 AM
 
18,481 posts, read 15,431,088 times
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Quote:
Originally Posted by johngolf View Post
Frugal when one has little is a good trait and one that could keep you out of trouble. As you start to earn, enjoying the nicer things is good. As you earn more being a bit extravagant is nice as you earned it. The ultimate is OK I have been there and while I enjoyed the $2,500.00 watch, I am just as happy with the $250.00 watch especially when I can still afford the $2,500.00 watch but I am going to invest the $2,250.00 difference for the future.

I say there are stages.

1. I have nothing but I yearn for more and I will work for it. Walmart.
2. I am beginning to earn and I can afford better. Macy's.
3. I am doing well and I can be a bit crazy with it. Nordstrom's.
4. I am doing very well but I want value for my dollar. A combination of all 3.
Why is "enjoying the nicer things" good? If you have debt or will have any debt, your money doesn't really belong to you anyway. You should probably keep the low costs until you are at a point where you can pay cash for everything.

Say for example you are going to go to medical school in two years, and will be taking out loans. By purchasing the "finer things" now, you are losing the opportunity to set that money aside and borrow less for the education. If you spend $2500 on a big, flat screen TV (even paying cash for it), and then borrow $100,000 for school later, you lost your chance to forgo the TV and get the education while only borrowing $97,500.

Therefore, you are effectively using money that doesn't belong to you on that television. The purchase will lead to you having $2500 of "television debt" rolled into your school loans!

Which is to say, you can't afford the television!

There are only two things you should pay for even if you can't afford to: food and shelter.

And we are talking BASIC food (not fine dining) and BASIC shelter (not living without roommates in your own place).

Last edited by ncole1; 12-10-2013 at 12:12 PM..
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Old 12-10-2013, 07:34 PM
MJ7 MJ7 started this thread
 
6,221 posts, read 10,680,637 times
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Quote:
Originally Posted by ncole1 View Post
Why is "enjoying the nicer things" good? If you have debt or will have any debt, your money doesn't really belong to you anyway. You should probably keep the low costs until you are at a point where you can pay cash for everything.

Say for example you are going to go to medical school in two years, and will be taking out loans. By purchasing the "finer things" now, you are losing the opportunity to set that money aside and borrow less for the education. If you spend $2500 on a big, flat screen TV (even paying cash for it), and then borrow $100,000 for school later, you lost your chance to forgo the TV and get the education while only borrowing $97,500.

Therefore, you are effectively using money that doesn't belong to you on that television. The purchase will lead to you having $2500 of "television debt" rolled into your school loans!

Which is to say, you can't afford the television!

There are only two things you should pay for even if you can't afford to: food and shelter.

And we are talking BASIC food (not fine dining) and BASIC shelter (not living without roommates in your own place).
thats all fine and dandy, however you could die tomorrow...anyone can, not that i wish it but accidents do happen. with that said, one should enjoy the finer things in life every once in awhile, you never know how long youll be around.
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Old 12-10-2013, 09:18 PM
 
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Quote:
Originally Posted by MJ7 View Post
thats all fine and dandy, however you could die tomorrow...anyone can, not that i wish it but accidents do happen. with that said, one should enjoy the finer things in life every once in awhile, you never know how long youll be around.
Depends on your age and health. If you're in your 20s and in good health and aren't an extreme risk taker (e.g. drinking and driving, ODing on narcotics, jumping from roofs over 10 feet high, etc.) the odds of dying in the next few years are actually quite miniscule. Given a decently-paying, stable job, one can amass $100,000. It just takes patience, hard work, and deferred gratification. Assuming you are gainfully employed full-time with health benefits, of course.

Now I am not necessarily saying all splurging is out of the question, but that one should be willing to put off large purchases if one wants to (for instance) travel a lot. You can have the large purchase sooner, or larger, or you can have more expenditure now, the problem is when you want all of that. This is the #1 cause of debt among most or all age groups. Too many Americans get in trouble because they want it all, and they want it now.
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Old 12-10-2013, 09:42 PM
 
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I think looking for value for the money you have to spend is the key. I am a sale shopper and try to not pay retail on items. I also find that things that I thought were important when I was younger are not anymore. I used to want a BMW, but now drive older cars that are less costly to maintain even though I can now go out and write a check for a new BMW or MB. Same with houses, paid for and just have to come up with the taxes now. It is a good feeling even if it is old fashioned.
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Old 12-10-2013, 10:01 PM
 
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When you're young, even small things add up quickly. Now is the time to be living frugally and socking away money in growth funds. Over time, the market averages 7%, so do the math and you will quickly see how wealthy you will be by age 60 if your money is compounding starting now.

If you spend and spend, in order to live the good life, you are merely sacrificing your future wealth in exchange for current indulgence. You are robbing your future self of vast riches, and your future self some 40 years hence will be looking back and saying, "God, why did I waste all that money? I could be financially independent today!"

Believe me -- I regret a lot of things and one of the biggest regrets is that I didn't start saving when I was in my 20s. Of course, I was in grad school until age 28 or so, but still. A lot of purchases, a lot of sushi, and not a whole lot to show for it today!
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Old 12-11-2013, 10:45 AM
 
18,481 posts, read 15,431,088 times
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Quote:
Originally Posted by Rogarven View Post
I think looking for value for the money you have to spend is the key. I am a sale shopper and try to not pay retail on items. I also find that things that I thought were important when I was younger are not anymore. I used to want a BMW, but now drive older cars that are less costly to maintain even though I can now go out and write a check for a new BMW or MB. Same with houses, paid for and just have to come up with the taxes now. It is a good feeling even if it is old fashioned.
+1

Debt free life that you find ways to resourcefully enjoy at every step FTW!!
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Old 12-11-2013, 10:50 AM
 
18,481 posts, read 15,431,088 times
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Quote:
Originally Posted by blisterpeanuts View Post
When you're young, even small things add up quickly. Now is the time to be living frugally and socking away money in growth funds. Over time, the market averages 7%, so do the math and you will quickly see how wealthy you will be by age 60 if your money is compounding starting now.

If you spend and spend, in order to live the good life, you are merely sacrificing your future wealth in exchange for current indulgence. You are robbing your future self of vast riches, and your future self some 40 years hence will be looking back and saying, "God, why did I waste all that money? I could be financially independent today!"

Believe me -- I regret a lot of things and one of the biggest regrets is that I didn't start saving when I was in my 20s. Of course, I was in grad school until age 28 or so, but still. A lot of purchases, a lot of sushi, and not a whole lot to show for it today!
I'm a grad student too. 26 years old, ~14 months gross income in savings/investments, not a dime of debt, and no mooching off parents.

I am still enjoying myself every single day. I don't ever pull all-nighters and I maintain social relationships.

The key is to pick the things (and the people) that are really important to you, and stop caring what strangers think!

Oh, and one more: Ditch the silly excuses and preconceptions...
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Old 12-11-2013, 11:10 AM
 
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One change I've made -- I used to buy more expensive clear shower curtain liners and when they got icky I washed them in the washer.

Now I buy them at the dollar store and toss them. It's quicker, and probably cheaper when you factor in water and the cost of heating it (have to wash them in hot water or the accumulated soap scum doesn't come off).

So on one thing I can be frugal AND cheap.
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Old 12-11-2013, 11:18 AM
 
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You don't know what's going on in other people's finances. Maybe they have to scrimp because of college loans or family problems or whatever. Personally, I'd much rather sacrifice quantity than quality. I can't believe some people have walk in closets! That are filled!!!! And the size of some houses today. Yikes!
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Old 12-11-2013, 11:37 AM
 
Location: Verde Valley AZ
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Quote:
Originally Posted by stan4 View Post
Becomes habit, I guess.

My brand of frugality is buying quality when it counts, using things up or over and over or until they simply wear out...most of those things are of better quality so they last longer.

Food is never the place to skimp.
I have to agree with you about the "habit". I lived on the edge of poverty for so many years that being super frugal is just a part of me now. BUT...and it's taken me three years to reach this point...I no longer deny myself everything I might want. I never felt deprived and as long as all my 'needs' were taken care of the rest could wait. Wants got put on the back burner for so long I actually forgot what they were! lol I admit that I will now buy things I really want IF I know I'll make good use of them and will keep them for a long time. I just bought a Food Saver that I have debated with myself for two years over! I considered buying a blender as well but vetoed that because I probably wouldn't use it very often.

Food is the one place I don't really skimp although I do take advantage of sales, etc.. My freezer, fridge and pantry nearly runneth over. Sometimes I think I must have an awful fear of starving to death. lol But it's nice to know that when the notion hits to make something I've nearly always got what I need.
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