Frugal living is lifestyle that will help you save money, no doubt.
However, there is a thin line between being frugal and being cheap.
Many people trying to save every last penny get into a mode of thinking that any big investment isn’t worth the up-front cost. What they don’t see is that these “big win” items often lead to a greater amount of savings.
Forget pinching pennies by using a $0.10 coupon. Forget skipping out on a morning coffee. Forget cutting up those credit cards to avoid temptation.
If you want to play the financial game than you got to make the big moves to be a winner.
1. Fight for a Great Home Loan Rate
let you become a home owner; there’s no way around it unless you happened to have saved up a ton of money.
If you want a “big win” in your finances then you have to be ready to fight tooth-and-nail for the best rates.
Your best option is to use your brain – get out there and begin sourcing as much information about home loan rates, how to negotiate, and tools to align it to your finances.
Knowledge is your friend.
Take the time to find the best rates, negotiate better deals, worth with your bank, and you could save thousands of dollars over the timeline.
2. Never Buy a New Car
The moment you ride the car off the lot is the moment when it significantly drops in value.
It can be very tempting to purchase a new car – we see others with new toys and we want them too.
The problem, here, is that you’re now stuck with a large amount of debt when you could have saved up and bought an older model that provides the same features.
Use online forums, discussion groups, and talk with others buying cars – you’ll learn the truth about this investment and it’ll save you a lot more than you’d think.
3. Invest in Your 401k and Roth IRA
Two biggest financial, long-term wins are:
· Roth IRA
These items become your nest egg.
Regular, automated contributions to these two items over a long period of time will have you living comfortably when you reach retirement. Place as much of your income into your 401k as you can and allow it to grow each and every year. Also, make sure to max out your Roth IRA and see if your employer will match your contributions – this leads to big leaps and bounds for your investments.
4. Keep those Credit Cards (but Automate Them)
Credit cards allow you to take control of your finances and build credit.
Credit is absolutely essential in this day and age if you want to purchase big ticket items.
However, many individuals trying to cut corners and living as frugally as possible demonize credit cards.
What’s really at play here is the lack of personal control.
If you can make intelligent decisions with your purchasing habits and pay your bills in full, you’re on track to building great credit. With that comes the big wins.
You can go a step further with credit cards where you won’t even need to think about them if you automate the payments each month. Instantly, your worries are all gone.
5. Don’t Buy Cheap
There’s a reason why certain products are cheap and it’s often attributed to cheaper parts.
Sure, you may have found a great deal on an item. However, if it breaks after a year you’re going back out to buy it again. And again. And again.
If you look at the quality of materials, warranty policies, and reviews of your products, you can find quality items that could potentially last a life-time.
These items come at a higher up-front cost but it ultimately allows you to save more money. You don’t have to replace them annually (for some items it could be decades before they need replacing).
These 5 tips go deeper in frugal living than most guides. How can you score a "big win" in frugal living?