Frugal Living Requires The Correct Mindset

With the correct mindset frugal living becomes enjoyable and an area which should be revisited frequently as your wealth grows. Many people have a natural dislike of frugal living because they want to live abundantly and see limiting what they can have as the exact opposite. Having the correct mindset and prospective is therefore necessary to change how you think about being frugal.

For example - how many times have you worried about something, or not wanted to do it but had to, and found that your attitude changed because of 'seeing' the problem from a different perspective.

Why then, is frugal living important?

Well, quite simply with less expenditure you will have more opportunity to save/pay off debt which will lead to more money for investments and wealth building. The more wealth we have the more abundantly we can live.

So, frugal living with the correct mindset actually creates wealth.

OK then, if you are thinking of leading a frugal living because of debt, think of it as the first step on your road to wealth building and a more abundant life. I still lead a frugal life from time to time as a way of cutting back on unnecessary expenses and becoming more 'lean and mean' again. I don't care how much money you have you will have to cut back from time to time to reassess and rethink your strategies. All wealthy people do this! It is one of the reasons they hold onto their wealth.

I have listed below the main ways you can live frugally, however I have split the list into two sections, Big Hitters and Small Hitters. The big hitters will make the biggest difference to your expenditure and save you the most money. The smaller hitters are still important and depending on your situation may save you alot of money too.

What do you think?

Have you got a particular tip or story to share about frugal living? We would love to here from you!

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Big Frugal Living Hitters

1. Get rid of or reduce income tax. Re think your whole life, depending on where you live your government may be taking a huge amount of your income in the form of income tax.


I did precisely this and am not only living more abundantly but can offer my children a better form of education and not one that is 'set in stone' by their former education system. There are a few countries and if you're from America a few states that have zero income taxes.

American States with no income tax - Washington, Florida, Nevada, South Dakota, Alaska,Texas, Washington, and Wyoming. Furthermore, New Hampshire and Tennessee limit their state income taxes to only dividends and interest income.

Countries that do not have personal income tax are Brunei, Andorra, Bahamas, Vanuata, United Arab Emirates, Nauru, Oman, Qatar, Maldives, Kuwait, Monaco(high cost of living)

There are many countries that have a low rate of income tax and/or a large personal allowance before taxation eg. Cyprus has a 19500 euro limit before tax is applied.

If your income tax decreases or even stops altogether frugal living is not so frugal anymore. The extra income can be used for wealth building.

2. Become a PT (perpetual traveller) - the idea is that governments treat you as a tourist and never as a citizen which means you don't have to pay any income tax to that government. You can very often stay as long as 5 months or so in a country before any tax liability. Citizens of the USA will still have to pay tax to their home country however there are ways round this. Our own wealth seminars have all the information and contacts to advice you of the legal ramifications.

3. Mortgage or Rent? This is quite a debatable subject these days. It all depends on your personal circumstances. There is no doubt that if you have a mortgage over a standard 25 years the interest you pay is phenomenal. This would lead many to automatically rent instead. My own opinion is this....if you are paying the mortgage eg. your own residential property, it is very important that you pay it off in much less than 25 years by increasing the amount/frequency of payments. That way you won't incur so much interest. If interest rates go up too much then rent out your home and move into rented.

Another point is to make sure you have a good mortgage deal, however this does not mean you automatically should change to a lower interest rate since the cost of setting up and/or redemption penalties may mean it will cost you more in the long run.

I think owning your home is an excellent wealth builder in the right circumstances. Having tenanted property is even better since your tenants are paying your mortgages.

4. Credit cards - 0% only or pay off every month. If you have this kind of debt then do your best to get rid of it once and for all. They are not enhancing your life unless you are using them to buy appreciating assets. If you are doing this be very careful you can pay the money back before interest is due.

5. If you are getting married or are already married make sure your assets are in a company name which is in an offshore location. Unfortunately divorce is common and can be catastrophic for your finances.

6. Reduce the thermostat setting on your hot water tank. It is completely pointless heating water up to cool it down again when you shower or take a bath. Hot water elements are extremely powerful and use alot of electricity.

7. If you are boiling a kettle, only put the required amount of water in. Pointless heating water up if your not going to use it.

8. Tumble Dryers use a huge amount of electricity, try to dry clothes naturally.

9. Try not to use air conditioning units as they are extremely costly to run.

10. If you can run one car only this will make you big savings in terms of insurance, road tax, fuel and servicing. Don't buy new cars. They depreciate in value. Also try and pay cash. The car I use regularly is only worth 2,500 euros!! Only fill the fuel tank to half full or less and check tyre pressures regularly. You can also change the filter and oil yourself. It's easy.

11. Stop smoking. In many countries smoking is extremely expensive. Huge savings can be made here by at least cutting back.

12. Alcohol. Same as the above or brew your own.

13. Keep your central heating thermostat on 15C when you're not there. Heating a house up from 8C or 9C to 18C is extremely expensive. This is assuming you have proper insulation including double glazed windows.

Small Frugal Living Hitters

14. Cut down on cosmetics...there is a huge industry out there getting rich on products that are not necessary especially womans products.

15. Start looking at your food bill and see where you can cut down, could mean you actually start to eat healthier too. Preparing your own meals should be cheaper but you will need to shop around for cheaper ingredients which will take a little more time.

16. Take sandwiches or similar to work if you are used to paying for lunch. Same with refreshments such as coffee.

17. Get rid of cable or satelite tv....there are more positive things you could be doing with your life other than watching tv.

18. Eating out and going out socialising, cut back if you do it more than once per week. Even if you do socialise/eat out once per week be careful where you eat. If you look around there is always a deal to be had.

17. Shop less, especially if you have a credit card and are not going to cut it up. Careful with online purchases too.

The above list of frugal living tips is not supposed to be exhaustive, just a few of the main ideas that I think you will find helpful.

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Frugal Living Inspiration

"History has demonstrated that the most notable winners usually encountered heartbreaking obstacles before they triumphed. They won because they refused to become discouraged by their defeats"

Bertie C. Forbes

"Beware of little expenses; a small leak will sink a great ship"

Benjamin Franklin

"It's not what you look at that matters, it's what you see."

Henry David Thoreau

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