The post of a few weeks ago highlighted the concern many of us have about our ability to retire comfortably, or even at all. The news has not been encouraging for quite some time. Maybe you have decided that it is time you take a more active role in making the best of a troubling situation. Maybe you believe that the people in Washington are likely to continue putting their interests ahead of yours. Or, maybe you are simply tired of being the victim and want to have more control over your life.
A satisfying retirement is built on much more than money. But, let's not be naive. Without financial resources retirement could be anything but satisfying. At this stage of the game, whatever the reason for your situation is almost unimportant. What is crucial is what you are going to do about it. But,, if the forces of the financial world are aligned against you, what can you do?
There are a few things that make sense to me. You can control your spending by controlling your wants versus your needs. You can change your lifestyle to reflect the reality you find yourself in. You can adjust your attitude to become a positive force instead of a negative drag on your life.
I can't solve all the problems. If I had those answers I'd be running for President....no, wait. Who in their right mind would want that job? But, I have experience in being fired with two young children and a wife to take care of, having a company collapse from under me, living on mac and cheese for several months, losing 40% of my IRA and 50% of my house value in a year, and being bled dry by health care costs. I've been there.
If you have been visiting this blog for a while, you know about some of the steps my wife and I have taken to adjust to our financial reality. Look under Related Posts below if you may have missed those ideas. This time I am writing more about an attitude change rather than a list of things you can do to get your budget under control.
Wikipedia defines frugality as " the quality of being frugal, sparing, thrifty, prudent or economical in the use of consumable resources such as food, time or money, and avoiding waste, lavishness or extravagance." Since few people would want to be known as wasteful or extravagant, why isn't frugality something everyone embraces? Why is it almost a dirty word to many folks?
Like anything else, there are different degrees of frugality that range from casual to extreme. For example, I can clip some coupons, look for price match opportunities, and stock up on something when it is on sale. Or, I can become an extreme couponer, getting massive amounts of products for free or low cost and spending hours on the computer to get 100 rolls of toilet paper for a few cents.
I think frugality may have become a captive of those who are extreme in their definition and pursuit. Using both sides of copy paper is fine; using it to wrap a present not so much. Taking handfuls of sugar packets home from Burger King, probably not. Keeping the air conditioner off all summer and heating the house to 55 degrees in the winter goes beyond what is reasonable for most of us. But, I would guess that the concept of frugality makes many think of those extreme examples.
As a teacher of mine used to say, "I beg to differ." Frugal living means keeping more of what is yours, yours. It means not spending money for things you don't need and don't enjoy. It means eliminating the habits and activities from your life that take your hard earned resources and gives them to someone else. Wikipedia goes on to say, "Common strategies of frugality include the reduction of waste, curbing costly habits, suppressing instant gratification by means of fiscal self-restraint, and seeking efficiency." All that sounds good to me. Retirement and frugality seem made to go together well.
US News recently carried a story, "The Secret to Living Well on $11,000 a year." This man's approach isn't one many of us would follow, but it makes for interesting reading. It was a follow up to "The Secret to Living Well on $20,000 a year." This fellow's life is more mainstream. It is interesting to see how frugal others can be.
So, my simple question to you is are you frugal? Are you doing all you can to avoid waste and trim your expenses by eliminating things that no longer serve you well? Are you accepting whatever your financial reality is at the moment, regardless of why you are where you are, and controlling what you can control? Have you taken a hard look at everything in your life that costs you money, time, and effort and assured yourself that whatever it is passes the test?
If so, then I'd suggest you are frugal. Wear the badge proudly.