Saving money is quite possibly the number one rule of finance. It takes discipline and self-control that can be hard for some to develop, but is nevertheless a simple and effective way to boost your bank account.
Yes, saving money is great. Many have it down to a science. However, have you ever been accused of being too frugal? There’s a thin line between being cost-conscious versus a complete tightwad.
When it comes to saving money, there’s a right way and a wrong way. Don’t let frugality become a negative influence on your life.
Saving Money on Groceries
Right way: Buying the generic brand, comparison shopping and clipping coupons.
Wrong way: Forcing you and your family to eat unhealthy foods because it’s cheaper.
It’s true that bad food is also much less expensive than fresh produce. According to Reuters Health, a study by the University of Washington found that the average price of healthy, low calorie foods like green vegetables, tomatoes and berries, increased by almost 20 percent over two years. During the same period of time, the cost of artery-clogging junk foods like butter, cookies and candy bars dropped another two percent.
It can be so convenient to opt for a cheap and fast meal for the family, but doing so is extremely harmful to you and your loved ones in the long run. About a third of kids in the U.S. are overweight or obese and we can blame their parents’ ballooning waistlines for setting a bad example. There are plenty of ways to save money on food that doesn’t involve sacrificing your health in the process.
Saving Money on College
Right way: Applying for student loans with low rates, going to community college for the first two years and buying used books.
Wrong way: Avoiding the cost altogether by not going, period.
There’s no denying it — college costs a ridiculous amount of money. Collegeboard.com reports that the average yearly cost of attending a public four-year college is $7,020, up 6.5 percent from last year. It’s unfortunate, but there are plenty of people who would love to attend a university and don’t because they think they lack the necessary funds.
However, the amount of financial aid provided to students last year was also at a record high of $143 billion in grants, loans, work-study programs and tax credits. If you can afford to go to college but are skipping the opportunity just to save money, you are doing yourself a serious disservice. Whenever you sacrifice a valuable experience in the name of frugality, it’s bad.
Amanda M. Holt of Jobing.com explains the 2005 Occupational Outlook Handbook reports: “With a bachelors degree you [are] 12 percent more likely to be employed and for those with an advanced degree, your odds increase to 16 percent over people with a high school diploma.” In the end, paying for college means a better job and better pay in the future, not to mention the overall educational value you receive.
Saving Money on Entertainment
Right way: Going to the matinee, subscribing to Netflix and swapping music and movies with friends.
Wrong way: Illegally downloading music and movies for free.
If you’re frugal to the point of breaking the law, you’ve gone overboard. Illegal downloading seems to be commonplace these days and isn’t taken very seriously, but it should be.
Maybe you aren’t concerned with the moral implications of what is essentially stealing. Sure, the movie stars and musicians are probably not going to miss a meal because they lost money to illegal downloading. You, however, could face fines of hundreds of thousands of dollars and even jail time for doing so.
Maybe you’ll never get caught, but is it really worth the risk? CNN reports that last year, a 33-year-old woman from Minnesota was fined $1.9 million for downloading 24 songs illegally, which pretty much negates any frugality on her part. She probably didn’t think she would get caught either.
Saving money is a great skill, but don’t let your desire to spend less reduce your quality of life. There’s always a constructive way to save money on expenses. Just remember, some things are worth paying a bit more.
If you’re suspicious your frugality is verging on just plain miserly, reevaluate your current habits and determine if they are really making a positive difference on your budget and your life.