Oh no, two frugal centric articles in one week! Sorry about that. I didn’t coordinate with Melanie enough so that’s why we ended up with two frugal articles this week. Don’t leave yet, though. I’m going to tell you why being frugal might not be a good idea after all.
I have always been pretty frugal since I can remember. Our family immigrated to the US when I was 12 and my parents struggled financially for many years. We didn’t make much money, but we never built up any debt either. We lived within our means and we had to be frugal due to necessity. I guess I’m naturally frugal because the frugal habit stuck around even after I finally earned a good salary.
When I started working, I prioritize saving first and always lived within my means. The only thing I really splurged on was traveling. Over time, some lifestyle inflation is inevitable, but I think we are still living a pretty modest lifestyle now. So what’s being frugal anyway? Here are some things we do to stay frugal.
- Moderate eating out – We usually cook at home and eat out once a week at the most.
- Car – We share one car and we don’t put a lot of mileages on it. Mrs. RB40 mostly uses public transportation.
- Communication – We use Ooma and don’t have to pay for a landline. Both of us use Republic Wireless and pay about $35/month combined for services.
- Clothes – The best thing about being a stay a home dad/blogger is I can wear whatever I want. I don’t have to look professional and I usually just wear jeans and t-shirts. Mrs. RB40 needs to look professional so she spends more on clothing.
- Entertainment – I love finding free entertainment. We’re pretty lucky because there are a ton of shows and fun stuff to do for free in the summer here. It’s a bit tougher in the winter, but we still find ways to be amused. We’ll mostly read and watch movies from the library.
We are generally pretty good with our discretionary spending and we don’t buy a lot of stuff to clutter up the house. That’s a good thing and most American household could improve there. I think it’s ridiculous that Americans buy so much useless junk that we need to rent storage units to store them.
Downside of Living Frugally
Being frugal is a good thing, but there is a downside too. Sure, we miss out on luxury cars and nice clothes, but that’s not a big deal for me. The bigger problem is that the frugal mentality clashes with the mainstream American value. That’s not good if you want to be an entrepreneur. I have been watching Shark Tank these last few weeks and I got worked up every time. Why? I got mad because I could never come up with these ideas the entrepreneurs have. I would never pay for any of the stuff that people come up with on the show. My frugality is limiting my imagination and that’s a big downside for an aspiring entrepreneur.
Let’s look at some products from recent Shark Tank episodes.
Bottle Breacher – A veteran came up with the idea to convert a 50 Caliber bullet into a bottle opener. Pretty cool, but pricey at $20+. I would never buy this because I already have a few bottle openers.
BeardBrand – They sell premium beard oil. A tiny little bottle is $15-$25. First of all, I can’t grow a beard. Second, I don’t think this beard fad is going to last. Just shave guys.
SunStaches – Novelty sunglasses. Pretty cool, but I don’t need one. This might be a nice gift, though. You can get SunStaches on Amazon.
Ninja Cards – A pack of ninja throwing cards and target. Flinging cards like ninja stars looks like a lot of fun, but do I really need one?
Floating mug Co. – A mug with built in coaster for $20. We already have mugs and numerous coasters liberated from the local pubs.
Titin – Wow, a weighted workout shirt and shorts for $250. I guess this will help you get the most out of your crossfit sessions (apparently around $150/month.)
Titin’s revenue is $1,000,000/month. Bootle Breacher sold over $500,000 worth of bottle openers last year. These numbers are amazing! The problem is I would never buy any of these things. Being frugal means being mindful when you spend money and these things are not very practical. Why should I pay $20 for a bottle opener when I can get one for $1? I have a big aversion to paying premium price.
Some of these entrepreneurs actually got partnership deals from the sharks! That’s the problem with being frugal. I’m out of step with American consumer sand my imagination is limited. Being frugal is nice for your pocketbook, but it might not be the right mentality if you want to be an entrepreneur. Even if I come up with an awesome invention for frugal people, there wouldn’t be a big market out there. I guess I should give up my dream of inventing a blockbuster consumer product and enjoy my frugal lifestyle.
What do you think? Is being frugal the wrong move for entrepreneurs? Shark Tank is on tonight. 🙂
Thanks for leaving your comments! Now that I think about it more, I think the imagination part isn’t the big problem. I can still imagine crazy gadgets, but I definitely don’t believe in them enough to invest my time an money. If I won’t buy it, then I probably can’t get behind it 100%. That’s what these small startups need. The inventor needs to bring their vision to the masses. The execution is much more difficult part of starting a business.
For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.
Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.
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