Some people think the word cheapskate is an insult. Not me. I enjoy being called a cheapskate. It reminds me that I’m not what I used to be: a credit-card junkie. There was a time I used plastic to fill the gap between my pathetic income and the life I so rightly deserved.
When my six-figure bridge collapsed, (yes, you can take that to mean more than $100,000 in non-mortgage debt) I had two choices: change my ways or lose everything. Knowing I wouldn’t do well with the latter, I opted for change. I could fill several books with all that happened and what I’ve learned (Wait! I have), but I’ll cut to the chase. We didn’t go bankrupt, we paid back every penny and now I live to tell. Yeah, you can call me a cheapskate any day, and I’ll take it as a compliment.
So, you may be thinking, how did she do that?! I stopped spending every penny I had and all we hoped to have. Bottom line: I learned how to live on less than our income. A lot less. The steps are simple:
— Rein in your brain. You have to stop believing you are entitled to have it all now and then pay, and pay and pay for it later. The truth is you can’t have it all, but you can have enough.
— Embrace frugality. I was repulsed by the word until I understood it. Frugality is just doing whatever it takes to spend less than you earn. What a novel concept. Frugal doesn’t mean tacky, frumpy or stingy. The truth is we cheapskates (see? I called myself a cheapskate!) actually fix stuff instead of running out to buy new stuff. Another novel concept. We figure out how to use this for that when that costs more than this. We drive paid-for cars, we challenge everything and ask if there’s a better way. Here’s an example: I used to get my hair cut every four weeks. Then I figured how to stretch that to six. That’s four-and-a-half fewer haircuts a year, which translates to — well, you do the math. Apply this kind of thinking to all areas of spending and just watch the dramatic results. Being a cheapskate is less embarrassing than you’d think, unless you count that half haircut. Ha-ha!
— Never pay retail. As cliched as that may sound, it’s a principle to hang on to. With so many discount stores and America’s gigantic garage sale — ebay.com, half.com, craigslist.org — you may never pay retail again. And how about that food? Let me tell you, I was a major coupon snob until I learned how to make those suckers work for me. Now I save around 60 percent off my grocery bill every week. I swallowed my pride and learned how to do it right. Watch for more on that in an upcoming column.
I could go on and on, but I’ll close with this: If you begin to apply even a few of the things you read in this column every day, you will end up with extra cash. You just might want to open that savings account now so you’ll be all ready to go.
Mary Hunt is founder of www.DebtProofLiving.com, a personal finance member website. You can email her at mary@everyday
cheapskate.com, or write to Everyday Cheapskate, P.O. Box 2099, Cypress, CA 90630.