10 Habits of Frugal People and Are They Worth It?

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Many people seem to be inching toward frugality these days. During the Great Depression, frugality had to become a way of life. The actions many people did in order to save money are often considered crazy in today’s world.

During that time of twenty-five percent unemployment and a foreclosure rate nearing fifty percent, people did just about everything they could to save money. Consider this story from the Ohio Department of Aging regarding life during the Great Depression.

“Money was tight and we couldn’t afford many things but it is surprising what you can do without. There were times when there was not enough money to even pay the shoe repair man to fix a hole in my shoes.

But if you could find some heavy cardboard, you could stick that in the bottom of your shoes and that helped until your parents could afford to buy you another pair.” -Doris, age 78

Times have changed, but frugal people still work to stretch their money as well as they can. They have a different way of thinking than the typical spender. Here are ten habits of frugal people. How many of these habits do you practice?

Top Habits of Frugal People

Frugal people view money differently for a number of reasons. Some have developed habits of frugality after living through tough financial times. Others follow frugal habits learned from their parents, grandparents or other people close to them.

And still others learn habits of frugality from the simple realization that money managed well provides freedom. The good news is that frugality can be learned – it’s not just some innate gift that people are born with.

My husband and I both grew up in sparse financial situations, but for a long time we focused on wanting to have what we never had as kids – from a material standpoint.

A few years back we came to the realization that what we really desired, what we really felt was missing from our financially poor upbringings, was security – the security of knowing we wouldn’t ever have to worry about money.

Once we realized what we really wanted from our money, we began learning and developing the frugal habits listed below and are now working our way out of debt and into that financial security we long for.

The ten habits listed below can help you reach your financial goals as well – if you are willing to make them a part of your daily life.

Here are some of the habits frugal people practice in order to have more money to use for reaching important financial goals.

1. Frugal People Are Cost Conscious

Frugal people work hard at spending their money consciously.

This includes techniques such as:

  • Knowing the prices of things they buy regularly, whether by memorization or by keeping a list
  • Keeping an eye out for sales on things they use regularly or know they will need in the near future
  • Being willing to buy an item used instead of new if it makes sense

Frugal people work to stay cost conscious by thinking carefully before they buy. For instance, if they need a household item such as a ladder, could they find one on Craigslist for cheaper than they would by purchasing new?

Can they wait until an item is on sale before they buy it? Can they borrow the item from a friend or relative if it’s something they’ll only need to use once?

Being cost conscious means thinking carefully before laying down your cash for something, whether it’s a necessity or not.

It involves learning to almost subconsciously ask yourself before every purchase whether or not there is a way you can get the item or experience you are about to spend money on for less.

When it comes to groceries, this might mean menu planning around the sales or using coupons. It might mean buying generic as opposed to buying name brand.

When it comes to entertainment costs such as eating out it might mean only buying the happy hour specials, sharing a meal or finding a 2-for-1 dinner coupon.

Being cost conscious when it comes to vacationing might mean staying at an alternative to a hotel like an Airbnb that costs less. It might mean foregoing expensive attractions and taking advantage of the natural scenery at your vacation destination instead.

Cost conscious people work to spend money smarter instead of just for the sake of saving.

2. Frugal People Tell Themselves “No” Often

People who are successful at being frugal have learned the art of discipline. In other words, they’ve learned how to tell themselves “no”.

In today’s instant gratification society that can be a tough habit to pin down. Many people have become used to following their desires up with instant purchases.

Online shopping conveniences means you don’t have that extra time to get in the car and drive to the store as you are considering purchasing that new TV you want. You just add the TV to your online shopping cart, check out and it’s on its way.

The same goes for restaurant meals. Most chain restaurants will deliver your favorite meal on their menu with one quick phone call.

The lack of work needed to buy stuff and spend money these days has lulled many people into a lack of discipline when it comes to spending.

Frugal people work hard to exercise and practice that discipline, though. They take the time to think about their purchases and whether or not those purchases are the best use of their money.

Frugal people also consider whether the purchase will bring them closer to their financial goals or take them further away from those goals.

They think about how much value a purchase will bring to their life: Will the purchase provide lasting value or happiness, or will the joy from the purchase be short lived?

Using Visualization to Stay Disciplined

Telling yourself “no” about a lot of purchases can be difficult. One of the tools we use to help us stay on track and avoid unnecessary purchases is the tool of visualization.

For instance, the main car we drive at our house is twelve years old. Sometimes we get so sick and tired of driving that thing. Sometimes it’s tough when loved ones get new cars.

However, when we take the time to envision how we would feel if we were burdened with a huge car payment (the average car payment these days is a whopping $502 a month), it suddenly becomes much easier to avoid buying a newer car.

We focus on the fact that our car is in really good shape for its age. It runs well, has minimal rust and was a top-of-the-line model in its day. We bought it used for $8,000 and paid cash.

We’ve gotten really used to the wonderful feeling of not having a car payment, and using visualization to help us stay away from taking on another one really helps us avoid those times when we get drawn into wanting shiny stuff.

Telling yourself “no” about purchases that don’t truly bring value to your life might not be easy at first, but over time it will become a habit you’ll likely learn to embrace if you are willing to practice it.

3. They Will Sacrifice Quality – When it Makes Sense

Some people confuse being frugal with being cheap. The truth is there is a major difference between the two.

Cheap people sacrifice quality at every turn. Frugal people know when to sacrifice quality and know when it’s better to spend more.

For instance, many frugal people – although they stick to a budget – won’t sacrifice quality when it comes to gift giving. They also won’t sacrifice quality when it comes to a purchase they’ll use long-term.

If the purchase is a household item such as a table for instance, they may buy a quality product knowing they’ll keep that table for a good twenty years.

In our family one of the ways we’ve learned to know when to sacrifice quality and when not to is in terms of eating out. We used to eat out two or three times a week at subpar restaurants.

Now when we eat out we’re willing to go to a higher quality restaurant, but we only do it two or three times a year.

On the other hand, we won’t spend a lot of money on things such as school supplies. We buy the 25-cent notebooks and the 15-cent folders knowing they’ll serve the kids just as well as the expensive stuff.

Sacrificing quality when purchasing a product that you’ll use for a long time or use a lot will probably just end up costing you more money in the long run.

However, sacrificing quality on an item that is for short-term use or that just doesn’t need to be a quality item is often worth the savings.

Learning the difference might take some trial and error on your part, but with a little experimentation you can learn what items are worth buying for less and what items are worth spending more on.

4. They Value Their Money Down to the Penny

Frugal people understand that every penny counts. My husband and I got into tens of thousands of dollars of debt with an “It’s only (5, 10, 20, 50 or any random number that fit the purchase) dollars” attitude.

There were no huge purchases or vacations – it was all nickel-and-dime stuff.

It was that revelation that made us understand that every penny really does count when it comes to living a life where we’re spending our money on what is most important to us.

Today we routinely work to save pennies (as long as it doesn’t take too much time or effort) on nearly everything we buy in order to free up money for meeting our goals of debt freedom.

We also routinely put extra pennies and dollars into our savings and investment accounts, and toward our mortgage.

Sometimes it feels pointless to add an extra few bucks to a loan payment or savings deposit, but after nearly five years of understanding the value of a penny, we’ve learned that those extra little bits of cash can really add up.

As an example, let’s say you take out a $200,000 mortgage on a thirty-year note with a four percent interest rate.

If you pay an additional $1 per day on that mortgage note as an additional principal payment, you’ll shave 1 year and 8 months off of your mortgage, paying it off in 28 years and 4 months instead of thirty years.

While that may not seem like a lot of time when you are looking at a thirty-year mortgage, you’ll be glad when you get to year 28 and you’ve only got four months to pay instead of two more full years.

Start taking your spare coins and dollars and saving them for a financial goal such as saving for a vacation or using them to put toward early debt payoff. I’ll bet you’ll save more than you thought you would.

5. Frugal People Save Their Money Consistently

Having a consistent savings plan is highly important to many frugal people. They believe firmly in developing a habit of saving money.

For many frugal gurus, this usually means having an automatic transfer made into their savings account each and every payday. In other words, treat your savings just as you would any other bill.

Another part of saving money that is important to frugal people is paying themselves first. That means they put money into savings (and leave it there) before they pay anything else – including their rent or mortgage.

By learning to develop a habit of paying yourself first and paying yourself every payday without fail, you get used to learning to live on your post-savings income.

This “set it and forget it” attitude will help you spend less and grow your savings almost effortlessly, and before you know it you’ll have a nice-sized pile of cash with which to cover emergencies or pay cash for an important purchase.

Your employer may be able to help you save first by putting a percentage of your paycheck into a separate savings account, or your bank may be able to help you by scheduling an automatic transfer each week or month from checking to savings.

Another way you might follow the frugal people and make saving easier is to open a savings account at a different bank.

Some banks offer high interest savings accounts that can pay 1% and sometimes even more – a much higher savings account interest rate than you’ll find at most other financial institutions.

By having your savings account at a separate bank from your checking account, you’ll be less likely to dip into it than you would if it was at the same bank you have your checking account at.

6. They Work to Make Things Last By Repairing Items

Frugal people are great at working to make things last as long as they can before they spend the money to replace them. As you saw in the story I mentioned earlier, back in the days of the Great Depression that meant placing cardboard inserts in shoes to prolong their use.

You don’t have to go that far to be considered frugal, but learning to repair things or make due even if they’re not perfect will help you save money.

We have a garage that is heated by a big propane gas heater. A couple of years back a part went out (if I remember correctly, it was a heating element). When we called a local repair shop to get an estimate for our make and model of heater, they quoted us a price of nearly $250.

Replacing the large heater would’ve cost almost $1,000.

My husband did a little online research and found he could get the part for $47 at a shop about 25 miles from our house.

He was nervous about replacing the part, but found a YouTube video that showed it could be done pretty easily. He decided to try and do the repair himself.

In less than two hours he watched the video, drove down to the parts store, got the part, came back, installed it and we were good to go with a heated garage. We saved almost $200 by doing the repair ourselves, and almost $800 by avoiding purchasing a new heater.

Many times, things break and can be repaired, or don’t necessarily need to be repaired. I know Deacon has a chip on his kitchen faucet that can sometimes be an eyesore to him.

However, he and Kim would rather put an extra $300 on their mortgage than to replace a perfectly working faucet because of a harmless chip.

It’s tough to go against the grain sometimes: many other families would just replace the faucet. But frugal people don’t let appearance dictate how they spend; instead they live with imperfect stuff for the sake of reaching their financial goals.

7. They Take Advantage of Community Resources

In many communities, there is a plethora of community resources that make for free entertainment or help in other ways.

Frugal people keep abreast of these resources and how they can utilize them in order to save money. Here is a short list of some of the free resources communities share with their citizens.

The Library

Your local public library likely has a large selection of books you can read (either for education or entertainment purposes), movies you can rent or social events you can attend. Taking advantage of these resources can save bundles of cash.

Local Entertainment

Many cities and towns show free movies, put on free concerts or other free shows and put together other free events in the name of unity and fun. The best part about many of these events is that they are FREE.

Check out your local community paper or city website to see what types of free entertainment your city offers.

Free or Cheap Housing Maintenance Items

Many cities and counties offer freebies or items at terrific cost savings to help you maintain your home.  In my county, they regularly send out coupons for large discounts at the recycling center.

They also have occasional days where you can bring in recyclable items such as electronics or hazardous materials for free (If you want to take a bit of extra time, however, you can actually earn money and get paid to recycle computers or other types of electronics).

In addition, every spring our county offers residents the chance to buy a wide variety of trees at a deeply discounted price. Everything from fruit trees to maples, oaks and more are available to help landscape yards and provide self-sufficient food supplies at a very affordable price.

Local newspapers and city and county websites are great resources for being able to find free or cheap solutions for caring for your house and yard.

Check out the many community resources in your area that can help you save money.

8. Frugal People Keep Long Term Goals in Mind

Another habit of frugal people is that they keep their long-term money goals at the forefront of their mind. Staying aware of long term money goals means less temptation to spend.

It’s well known that keeping on track with long-term money goals can be tough. It can be difficult to avoid frivolous spending when you’ve still got to save another $150,000 to pay off your mortgage or another $400,000 in order to reach your early retirement goal.

One way frugal people help stay aware of their long-term goals is to use visualization. Some people create a poster board that represents their financial dreams and goals.

Other people keep a list in their wallet of what they’ll do when they reach debt freedom or financial independence.

And still other people use mentors and accountability partners to help keep them strong when they’re tempted to spend on something that isn’t in line with their goals.

Have you taken some time to figure out what your long-term money goals are? What money milestones would bring serious peace and joy to your life?

Would you like to be mortgage free? Pay cash for your kid’s college education? Save enough money that you could live off of the interest it earns?

If you haven’t done so already, make a list of your short, medium and long-term financial goals and how you can modify your budget to reach them.

Investing your money may help it grow faster, which means you can reach your goals faster.

9. They Seek Out Frugal Fun

Fun doesn’t have to be costly, and frugal people are often geniuses at finding free or frugal fun.

Here are some ideas for fun frugal activities:

  • Spend the day at the beach
  • Plan a hiking, biking or walking excursion
  • Call some loved ones and plan a picnic or BBQ
  • Have a weekly or monthly game night at your house
  • See an outdoor concert, movie or other event
  • Go ice skating at a local park that has an ice rink
  • Go camping, fishing or both!

The possibilities for free and inexpensive fun are everywhere. Sit down with loved ones and make a list of things you can do for fun that don’t cost a lot (or anything) and use the list to plan your weekly entertainment schedule.

10. They Consistently Practice Self-Development

In Tom Corley’s book, Rich Habits, he outlines many of the habits that rich people share. While not all frugal people are rich, most rich people are frugal.

One of the other habits of frugal people is that they are continually practicing self-development in order to excel both personally and professionally.

Many people who are good with money read non-fiction nearly every day, exercise every day, practice self-education on topics that are important to them and practice living a life of integrity.

In other words, they consistently practice improving themselves.

Are any of the habits listed above habits that you do practice or could practice on a regular basis? And more importantly, are the habits worth it?


I suppose the answer to that question depends on the individual person, but in order to help you answer that question for yourself, you should probably ask yourself a few other questions, such as:

Am I currently spending in a way that is hindering me from living the life I want to live?

Do I have unmet financial goals that could change my life if I reached them?

Would I be unhappy if I was in the same money situation five years from now that I’m in today?

If the answer to any of those questions is “yes”, adopting the habits of frugal people in order to find more money to save and invest toward your goals can help you go from “financially so-so” to “financially great”.