5 reasons why you should become frugal during lockdown time.

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You might have not even though of it but now while in the lockdown is the best time to become frugal.

A frugal lifestyle is becoming increasingly popular amongst people and no longer is looked upon as being cheap. Obviously if taken too far, it can fall into such category.

However, there is a difference between being cheap and being frugal.

The main difference between those two is in the mindset.

If you never spend money and avoid buying anything other than necessities- that’s being cheap.

If you, however, think before you buy, avoid wasting and make smart cheaper choices, that’s frugality.

So what exactly means to be frugal?

According to a dictionary:

Frugal means economical in the use of expenditure, prudently saving or sparing, not wasteful.

I truly believe in the frugal lifestyle being a means for saving the planet as well.

Think about it- if we buy fewer clothes that we don’t need but just want to have as it’s in fashion it leads to an increase in production and the fashion industry is one of the 5 most polluting in the world. Same goes for driving the electric cars- the CO2 emission is much lower, saving the environment. Wasting food means fewer land fields filled with waste. You might think, one person’s contribution will not make any change… One person’s not, but if the majority adapts the same principle, together we will have a massive impact on saving this planet.

We already see how the lockdown and the change in our behavior is impacting the world environmentally. There is evidence proving the global air pollution has decreased significantly and I have already covered this in my previous post 10 Benefits of a Lockdown.

These are unprecedented circumstances and the one thing we have never thought of planning for.

We are in the pandemic state and it’s never been a better time to start living a frugal life.

You might have just lost your job, been made furloughed or had to shut your business down due to the lockdown.

SO now really is the time to revise your lifestyle and look at it from a different perspective.

You need to figure out how to survive this crisis on a decreased income. You might have some savings and that’s great if you do. However you might not have been in a position to save before a lockdown, or just spent all of your savings on a new house, a car or holidays. You have to figure out how to get used to living on a tight budget.

Changing your mindset and the attitude to money will help you tons. When you are put in a financial crisis, what you don’t want to do is to do nothing about it and just let days roll. Nope, that’s not the way forward my friend!

You have to start acting fast!

How? By making small adjustments to your everyday life. I have covered just how you can save money in my post 30+ everyday tips and tricks that helped us save over £5k last year.

But in this post, I want to focus on the reasons why the lockdown is the best time to become frugal.

Here are 5 reasons why you should become frugal during lockdown time:

1. We have financial pressures

As already mentioned above, you might have found yourself being in a position where you have lost a job, a business or your pay has been cut due to the lockdown.

You need to become savvy with your money and get used to the idea that for some time you will have less of a disposable income. Therefore you need to start considering what you can cut down from your regular spending to save money and also rethink what are the necessary items that you need.

Do you need this brand new iPhone that’s just come out that will cost you a fortune which quite frankly you don’t have at the moment? I am sure you don’t, and you can wait for it until either you have gone back to earning money and saved for it, or until it gets cheaper (iPhone’s don’t get cheaper quick hence option A is applicable in this case, but other items do depreciate real quick).

With the social distancing rules in place, it is impossible to go out to bars, pubs, restaurants or social events. This will already be a good cut down on your expenses, so what you can do is to compare previous months to the very recent one and see where your money goes.

How to do it?

The best way is to go through your bank statement and highlight every single credit on coffee, lunch, pub, bar even petrol. You need to analyse which one of them was essential. The questions you want to ask yourself would be:

Could I bring my coffee in a thermostat instead of buying if from barrister?

Could I bring my lunch instead of buying one?

How many times did I go out?

Did I need to use the car so much?

All these types of questions will help you understand which of the expenditures were of those you could avoid. Your mum’s birthday’s party was truly essential but going out with a friend 4 times in one week is probably not that essential.

The idea is not to cut off your social life but to evaluate what truly adds value to your life. If meeting friends is what keeps you happy, carry on, but if you want to be frugal consider cutting down.

Once you have established this look back at your shopping habits, drinking habits and any other habits you might have for that matter.

Did I have to buy the latest trainers that I had to pay for with my credit card?

Did I have to get them all-inclusive holidays in a 5-star hotel or would 3-star bed and breakfast do?

With the whole frugality, lifestyle is not about cutting down on the pleasures, is about fining cheaper alternatives, or perhaps waiting for a better time to buy at the fraction of an original price.

One more thing that we tend to waste money on is food.

During the beginning stage of the pandemic, we have seen some extraordinary panic buying where shops were being stripped off the essentials and dry food (and toilet papers). Stockpiling had become a real issue and even the government had been urging people to stop.

I have recently read this article in which we can read that Britons had spent £10.8b in March alone resulting in excess food waste. Bins are overflowing with bread and other even longer shelf life products as consumers had bought more than they can consume or store.

The way to avoid waste is to plan and to use leftovers to cook from. There are so many resources on the internet on food planning and millions of recipes.

Also, make list according to what you are planning to cook before you go shopping so that not only you buy all that you need for your recipes but also you don’t end up packing things you don’t need (potential waste).

Revise also were do you shop. Could you buy things in cheaper supermarkets?

All the above steps should help you to understand where your money goes and how can you reduce or avoid spending altogether.

 

2. Being Frugal will teach you to value your hard-earned money

 

Unless you have been born in a very wealthy house or won a lottery, you have to work hard to earn your money.

Becoming frugal will change the way you will think about your hard-earned money. It is a process in which you will start noticing just how much less you can spend if you only readjust your behaviour and habits and will teach you to value your hard-earned money.

This process is not something that will happen overnight and might take you a while before you understand this but it is so worth going through because it will possibly become your new way of life.

The short term burst of happiness that you might get from some fancy new gadget you buy, will not make you happy in the long term.

If you avoid unnecessary spending and become economical you will notice you can start saving too. This, in turn, will help you to save for a deposit for a house, or to pay off your mortgage if you have a house already. This leads to the next reasons why you should become frugal during lockdown time:

 

 

3. Frugal lifestyle will change your perspective for a long run

Wouldn’t owing to a house or being mortgage-free make you happy?

This cannot happen if you keep spending money on every wish you have.

 

In my early twenties I used to have this kind of attitude where I thought, I had earned the money- why should I not treat myself to the latest phone, a new watch, or fancy sunglasses etc.

This was not a healthy attitude and would not get me far if I would not change my perspective.

I then got married and I began to go through a process of changing my perspectives. My husband was very keen to get us on a property ladder. I saw how hard he’d worked (taking extra shifts and working longer hours). We had our first child and my priorities and my mindset had completely changed.

My needs were no longer my priorities as I wanted to provide the best life and living conditions to my child. So we both had begun living a frugal life and in 3 years from having our child we have saved for a deposit on our first house.

It probably could take us less time but we both had a lot to learn on the frugality journey. Back then I didn’t even think that this was the process we were going through as I never knew much about frugality. Just analysing the past makes me realise we were going through the same process I am talking about in this post.

This is the best opportunity to start changing your mindset and become frugal forever. It can truly change the way your future will look.

If you don’t sacrifice what you want, want you want becomes a sacrifice. 

 

 

4. You will be able to reach Financial Independence.

If you stick to being frugal now, you are more likely to stick around forever. This, in turn, will make possible to achieve a Financial Independence (FI).

In case you don’t know what is FI- it means you will have no debts and financial constrains like mortgage, loans, credit cards debts or finances. Completely debt-free.

Imagine being Debt Free!

No financial worries!

If you continue being frugal you will be able to also make your fortune as the more you save, the more of a disposable income you have. The more of disposable income you have the more possibility of investments open up for you.  Have you ever heard a say:

Money makes money

 

Exactly!

 

If you have savings you can make your money multiply.

I am not an expert in this field but I know just the person to send you to- Ken from the Humble Penny (mentioned on my blog many times). Ken has opened my eyes on the possibility of being Financially Independent. I have learned a lot from him and if you have any money questions- visit his website at TheHumblePenny.com

 

 

5. Frugality will help you retire early

It’s not to say you have to or you want to retire early, but think about it for a minute. Would you rather work in your usual career until you retire at the age of 67 or older (who knows what the government is going to come up with in the future- they might want us to work until we’re 70 or even 80!)? Or would you rather retire at the age say 45-50 when you have enough savings and investments for your money to do the work for you?

In the meantime, you still have enough time and energy to travel the world, socialise, explore your passions and interest and most importantly, spend time with your loved ones. Does this not convince you?

It does convince me and this is why I have become very interested in FIRE.

I have learned about the Financial Independence Retire Early concept from Ken (mentioned in the point above). This has become my goal and I hope you find this an interesting enough topic to at least give it a thought.

Conclusion

Here were my 5 reasons why you should become frugal during lockdown.

Being frugal is a journey in which you become to understand your weaknesses and where the full analysis of your financials are needed at the start. This might be rather difficult, to begin with however it can open up a door to Financial Independence and an Early retirement.

I truly believe that this is the best time to become frugal.

This goal speaks for itself and I hope you agree with me that it’s a dream for many too far to reach. It takes a strong person with self-discipline and a willingness to fight for it. But anyone can do it.

And I believe I can do it! And you can do it too!

And this, my friend, is why you should become frugal during lockdown time…

 

One thing I would also like to mention is that you can use this time now to seek additional ways of making money. If you have few income sources you are keeping your options open and in case of financial struggles, you always have a second or additional income you can fall on. I have covered some of the ideas in my previous post 30 Productive Ways to Spend a Lockdown Time.

I hope you enjoyed this post and will become frugal during the lockdown and will continue until you reach your dreams.

Good luck to both of us.

Thank you for reading.