Many folks are often looking ways to cut expenses. It’s enticing to think about how a few small changes can add up to big results.
I generally tend to think that we can’t save money unless we make it – which is why it’s important to really focusing on trying to grow income and protect it. That being said, when it comes to the total picture, saving money obviously matters and has its place. Of course, the name “Squirrelers” should be an indication that this blog supports squirreling away money!
So, along those lines, I can get into a mode where I’m looking to periodically find ways to save some money here and there. I was thinking about how much I spend on food, which really seems to be getting more expensive these days, and it seemed like a good place to start trimming costs. Maybe bringing food from home for lunch could save money, but also eating less food too. The concept of Hara Hachi Bu, which I related to money in a prior post, might result in savings. Less food consumption might be healthier, and cheaper too!
But then I started thinking that such ideas are often easier said than done. Sure, they can be done. But do we want to go through the effort of cutting back on the basics? To me, the personal finance hierarchy of needs is a good way to look at what can and can’t be cut easily.
Here, it’s clear that food is a base-level need. Why not cut costs on something else? We also need medical care, and basic shelter. We can’t cut there either, right? Doesn’t that make life harder?
Going back to shelter, there is one area where we can cut – but it’s at the higher level of the pyramid where “comfortable” home is noted. In other words, while we need a place to live, it simply needs to get the job done. It doesn’t need to be luxurious.
Where am I going with this? Well, what it comes down to is that when we are looking for ways to save money, let’s be realistic. Instead of micromanaging every penny spent on basic needs, why not live with a little bit more freedom on those things – while focusing on the bigger ticket items. Such as, the decision to buy an upscale home or the decision to buy a big brand name car. Here is where we can save big with just a few decisions, instead of painfully pinching pennies on basic needs.
My Questions for You
Do you find it tough to sustain frugality in terms of basic needs?
What do you think of the notion that a few big ticket expenditures are where we can often make smart decisions to save the most money?
Oh yes I faced it. I am relatively more frugal than my wife and whenever I tried cutting down on basic needs I faced resistance from her. I usually give in.
SB – smart man, or at the very least practical, by giving in to her:)
I tend to think that basic needs are the worst place to pinch pennies. Eating healthfully,for example, is arguably the most important thing we can do. (Ask anyone who has heart disease!) We all take good health for granted, until it’s gone. Then we suddenly grasp that most everything else matters little in comparison. The reason basic needs are ‘basic’ is, in part, because they’re fundamental to our happiness and well being. I think we undercut reaching these ends when we pinch pennies on the basics!
Kurt – very wise words here, I totally agree. We take health for granted until it’s gone, then we seem to get it. This is why some things don’t need to be cut from the budget.
My favorite point in your piece: stop trying to save nickels when there are $100 items in your budget that could make a real difference. Powerful stuff, if applied. Thanks!
Average Joe – I think some people are just addicted to the thrill of saving, that they get too focused on getting “victories” instead of focusing on the bigger ticket, more impactful items.
It is that simple, really: the needs should get the attention and the wants are where the sacrifices should be made. Of course, not only is the difficulty sustaining a certain way of spending, but it may be even more difficult for people to separate the needs from the wants. Even in the case of needs, adjustments can be made, as you refernced with the housing reference; sure we all need to eat, but do we need to buy organic at a super-premium, or get our food from the trendy over-priced stores?
Eric – oh, I agree that even in the case of needs, some adjustments can be made. It depends on how one defines “need”. I think a need is basic, healthy food – but a “want” is getting said food from a trendy store.
I stick to my budget for basic needs. It is a modest budget though and not overly strict. The problem with only saving on big ticket items is that they normally only occur once whole the basics tend to happen much more often.
Lance – true, the little things happen more frequently. Thus, they can really add up. I agreee. The thing I’m advocating here is to really be careful to avoid denying ourselves the basic needs, in order save money, when a few adjustments on bigger ticket items can dwarf the savings on even many small expenses.
I understand your logic, yet, I usually try to do both. Of course you can be too frugal. I like to choose the items on which I splurge, usually those that I really appreciate, like a nice dinner out or a vacation.
Barb – sometimes we do have to choose the items on which we splurge, while realizing that we can also be too frugal. I agree.
Sure the big tickets can save the most money… but sometimes it’s about getting started. I’ve personally found that if I can keep the smaller things under control I have a much easier time with the big stuff.
Andrea – you have a point, in terms of building up some momentum with the smaller stuff. Interesting! Once that momentum and confidence gets going, the big ticket items that offer bigger savings can be handled.
I wouldn’t cut back on groceries spending. That’s a basic need, but when you say food it means different things to different people. A lot of people eat out all the time and that can be reduce. Eating out once can cost the equivalent of 4-5 meals at home. That’s why we don’t do it too often.
Joe – sure, I agree that it can depend on each person’s situation. Cutting back in this case, as I’m describing it, is more along the lines of denying a basic need. So, cutting back on eating out daily and substituting eating at home isn’t sacrificing a need. However, skipping a meal at home, even when low-cost – or denying oneself nutritious choices – would be cutting back on a need.
A good friend of ours once advised “Always eat well”.
I agree.
Marie – eating well, at least in terms of nutrition and basic needs, is something we should do and not cut corners on. At least I think so! So it looks like I agree with you and your friend 🙂