Even the mention of words like frugality and thrift send some people over the edge because, for them, those words conjure up thoughts of poverty and deprivation. They assume that cutting costs is tantamount to diving into dumpsters to find one’s next meal. No wonder so many people prefer a life of debilitating debt to one of frugality.


Let me set the record straight. Please.

There is nothing undignified about spending less than you earn. That’s called living below your means, and it’s a fabulous way to live!

When you spend less than you earn, you have money to save—imagine that! And to give some away, too.

When you spend less than you earn, you are not dependent on credit to get by. It is a very good thing.

So, you may be wondering, how can you move from overspending to spending less, without giving up your quality of life? It starts with prioritizing everything according to how important it is to your life. Then only spend on things at the top of the list, ruthlessly cutting your spending on the things that don’t matter.

On a scale of 1 to 10 …

The way to get started with prioritizing things in your life is to come up with a simple system for every non-essential expenditure.

Here’s a good one: On a scale of one to 10 how much joy does this bring to my life?

Now, apply this to every way that you spend money. Do not hand out “10s” willy-nilly. Reserve that designation for only those things you truly love because they bring incredible joy and fulfillment to your life.

Stop, think, prioritize

As you prioritize, examine everything. Do you eat out often? Go to the movies? Travel?

Do you spend on home-improvement projects, kitchen gadgets and visits to the gym? Are cable television and electronic devices a main source of joy?

Are you most fulfilled when you are donating your skills and time to an outreach charity in your community? Is fancy jewelry your thing, or are you more into driving a fancy car?

Perhaps for you, it’s shoes or gifts for those you love.

Our lists are not likely to be the same. For example, eating out in mediocre chain restaurants is not a priority for me. To me, the food is overpriced and of inferior quality.

Having my own car is not high on my list, either. And I could not care less about English bone china or maintaining a koi pond, but I know people for whom both rate 10s on their lists.

But having a beautifully maintained yard with flower gardens, traveling to beautiful places and spending time with good friends are all at the top of my list. I will cut mercilessly in other areas to have money for the things that I really love.

Stop spending where it doesn’t matter

Personal finance is not about saying “no” to spending on the things you love. It’s a matter of scrimping like crazy where it doesn’t matter so you are able to spend where it does.

Living below your means is not about adopting a life of poverty. It’s about conscious decisions, not guilt. It’s about thinking and deciding what’s really important to you and then planning and saving … and sticking to it!

Question: What gets rated as a 10 in your life? Tell us about it in the comments feature below.

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