How to Live Frugally

Topics: Want, Stock and flow, Capital accumulation Pages: 2 (783 words) Published: April 18, 2013
Are you tired of being broke all the time? Do you want to know the secret to leading a wealthy and healthy life? If you have answered “Yes”, then it is time for you to live frugally! “But excuse me,” you might interject, “does that mean that I have to sacrifice certain things from my life and deprive myself?” Now hold on a second! Frugal living is not as torturous as you make it out to be. Au contraire, mon frère, living frugally is about living smarter and better for less. So let us move on to learning all about this “frugal living” that I have been advocating. It will be difficult at first but it will also get easier as long as you plan your savings properly, budget your expenses thriftily, and control yourself resolutely. Firstly, you must design a savings plan for yourself. Building up your wealth, instead of spending it all, will help you to prepare for the future. Maybe you want to get a car, maybe you want to take a holiday or maybe something unfortunate happens. With the money you have reserved, you will have less to worry about when the time comes. A good gauge to save is about 20% to 25% of your current income, but if that seems too restrictive then you can start off by setting aside 10% instead, or any amount which you are comfortable with as long as you stick to it. For those of you who, for some reason or another, are unable to trust yourself with your own finances, you can take this one step further by signing up for a savings plan with either a bank or an insurance company. There, they will design a plan that caters to your needs and usually offer you a better return rate for keeping the money saved in their savings account. This helps as they will transfer money periodically from your spending account into a savings account which you will only get access to after a significant amount of time. Therefore, if you will not see it, you will not spend it and will be saving it! So after saving some money from your monthly earnings, you must now create a...
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