4 Ways to Become and Stay Thrifty
When I was younger, I was a Boy Scout. In Boy Scouts we had to learn, memorize, and recite our oath and law.
The law said that “a Scout is trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean, and reverent.”
One assistant scoutmaster explained to us that the most important word of the law though was “is.” As he explained it, a Scout is these things. A Scout doesn’t decide if they are or choose to do them sometimes. It means that if it says a Scout is thrifty, it means they’re thrifty.
These guides have helped me many times in my life and there are times when I struggle to live up to them. Most notably, I am not the thriftiest person. Perhaps you are like me — you have trouble saving, you can’t seem to keep away from impulse purchases, you buy what you want, not what you need.
These problems have plagued me for some time now. Fortunately, there are ways to beat this, most of which I learned from Scouts.
1) Live within your means.
The first and most notable way to be thrifty is living within your means. This idea gets thrown about quite a bit especially by our parents and we are constantly reminded to “live within your means.”
If we’re honest, how many of us have an understanding of what that actually means? At best we have this vague understanding that it means don’t buy more than you make, which sounds easy, since of course how could you? Well the answer is more complicated than that.
Living within your means doesn’t just mean not spending 100 percent of your paycheck or more. Living within your means is about choices you make about spending your money. As opposed to going out and buying the drink your friends are buying, get the cheaper one. It means looking at the goods or services available and being able to say “no.”
This is not out of some self-pity, but rather a delaying of reward. This delay of small current reward for future bigger reward is something that separates humans from other animals. Even small children exhibit this problem.
An experiment originally done at Stanford University shows how as the mind develops, humans can learn to forgo instant rewards for bigger ones. Currently you are in college, probably working a job in retail or food-service and buying expensive things is beyond you for now. Working hard in college though will earn you days of more, bigger rewards.
2) Use debit cards and cash.
I said that it’s not possible to spend more than 100 percent of what you make and if you use debit cards or cash, that is absolutely true because these rely completely on how much money you have made.
So if you don’t have money in the bank and try to use your debit card you can’t use it because the money doesn’t exist. If you don’t have cash to pay for something at the corner store, you don’t have the means to buy that stuff. Enter the credit card.
3) Be smart about credit cards.
Although credit cards look incredibly similar to debit cards, they function in fundamentally different ways economically speaking. When you swipe a credit card, you’re not taking money out of your bank account. You are asking your credit card company to buy the item you need for you like your friend spotting you when you don’t have cash.
Your credit card company will have a certain amount of money that they will allow you to ask them to buy stuff for you before they say “no.” This is called your credit limit. Depending on the card and the cardholder, these can be very small – less than $500 – and very, very big –more than $5000 in credit.
Credit cards alone are not bad. They are certainly useful, but they present a hazard to thrifty living. High credit limits can cause enormous bills that take lots of time to pay off. These bills then accrue interest and become bigger.
As I said first, credit cards aren’t all bad either. If the credit limit on the card is low enough, these can actually act as spending barriers for the cardholder, forcing them to pay off their debt before they proceed to spend more.
4. Create shopping guidelines.
Another hard part of thriftiness is shopping. Sure, it might seem like a good idea at the time to buy that super cute stuffed animal, but later when you’re wondering why there aren’t any groceries in your fridge, you’re going to wish you hadn’t bought Mr Fluffles.
The first thing to remember about shopping is take only what you need, and I mean need. Will you live without that thing? Yes? Then don’t buy it.
The second thing to ask is, can I find a lower price or better deal? A lower price is just that, but a better deal is harder to spot. Sometimes the better deal is more expensive, but lasts longer.
Some stores have little secondary price tags that let you compare the price per ounce of product. Look and see if buying the 20 ounce is cheaper per ounce than buying the 12 ounce bottle.
The last part is asking, do I want that? If you want something, that’s okay. You can get it. You just have to earn it. That means taking a piece of your paycheck out every week or month and setting it aside for that thing. Work towards your goal and it will make achieving it all the better.