Episode 142: Learn how to live a life of frugality with Denis Truefin. Determine the difference between being frugal vs. cheap, how to start saving money, and what to do with the money you save.
What Does Frugal Mean?
There’s often a negative connotation with being frugal, when people simply don’t understand the difference between being frugal and being cheap.
The difference between being frugal and being cheap is looking at value and being intentional with spending. When you’re frugal, you want to spend your money on things that add value to your life and thinking before spending.
Alternatively, being cheap is not wanting to spend money, period.
Overcoming the Frugal vs. Cheap Mindset
In the future, when you’re financially independent, the people who concern themselves with your actions won’t matter. Being frugal doesn’t mean always cutting back; it means choosing to spend on things you want.
For example, being cheap might mean never traveling anywhere. Alternatively, being frugal might mean forgoing trips to a restaurant every week and saving for a luxury vacation down the road.
For Denis, one of his financial goals is buying a Tesla. Planning ahead and saving now will help him move closer to that goal, which has value to him.
How Frugal Living Can Help You Achieve Goals
Being frugal can help you achieve your financial goals to set yourself up for the life you truly want. Denis is currently saving to purchase a second property, which will boost his income and investments so that he can reach more financial goals in the future.
The money you save from being frugal can be reinvested into yourself, whether via the stock market or into diversification.
Having Fun When Being Frugal
The key to having fun and enjoying life while being frugal is setting some money aside for fun, and being intentional about your activities.
Denis and his wife have a $20 monthly fun budget that can be used freely. They either spend it on simple pleasures, like digital movie rentals or save for something every few months. Creating space for hobbies and passions is always a smart investment.