Frugality: 4 ‘Essential’ Expenses That Are Actually Luxuries

Money saved is like free moneyI’m often astonished how many things we in the developed world consider “essential” while a huge number of people in third world countries manage without them just fine.

Doing without many of these “essentials” – or at least downgrading them to cheaper options – can do wonders for your bank balance, helping you to live a more frugal lifestyle and making your money go further.

But there’s more too. Cutting down on these pillars of our capitalist society can also help the environment (the less we buy or throw away the better) and can, in many cases, actually lead to a simpler and more satisfying life once you adjust to the changes.

Indeed, it’s telling just how popular the “minimalist” movement is becoming as more people every day shed the consumer lifestyle and instead focus more on spending quality time with family and friends as well as having to work less to make ends meet.

All you need is a slight change of viewpoint. For some the benefits will be obvious. Others may scorn the ideas discussed below. But whatever your initial thoughts I’d encourage you to at least spend a little time thinking about the points mentioned in the hope that you can at least take away a few money-saving tips from this article.

So what are these “essential” expenses that most people can’t live without?

Exotic Vacations

Many of us work our fingers to the bone each week, with the only hope of escape being our annual vacation. We’ve worked hard. We’ve been tired and stressed. And now we deserve to see the fruits of our labor in the form of a luxury break.

And while I’m not dismissing the idea of vacations altogether, it’s worth noting two important points here. First, a vacation doesn’t necessarily have to be expensive to be enjoyable.

Second, if we took cheaper vacations we could either save money towards improving other areas of our lives or simply downsize to fewer hours or a lower-paying but less stressful career.

So when vacation time next rolls around, take a few minutes to consider if you really need that “all-the-bells-and-whistles” trip, or whether you can shop around, find a bargain, stay closer to home and save a surprising amount of money along the way.

Indeed, I know people who actually don’t go away when they’re on vacation. It might sound odd, but their ultimate pleasure is simply taking the time to slow down, visit friends and family and sit around in the sunshine reading a good book. All while saving hundreds or even thousands of dollars.

Cell Phones

It’s embarrassing to admit but a few years ago I dropped my cell phone down a toilet while I was out for the day. My first thought was absolute shock. How would I cope without my cell phone? As the truth turned out to be: quite easily.

Now sure, cell phones are certainly practical but as smart phones have grown in popularity they’ve also become a “toy” that constantly steals our concentration. There’s always a status update to read or a text to respond to.

We’re never really “switched off.” I’m sure you’ve had the experience of trying to chat to someone who just won’t stop fiddling with their phone and experienced just how annoying and distracting it can be.

So firstly put some time into considering whether a cell phone really is essential to you or whether you could manage without one—or at worst keep a pre-pay phone just for emergencies rather than constantly having the thing on 24 hours a day.

And if you can’t imagine a life without your cell, then at least take some time examining cell phone tariffs to see if you can downgrade your plan to save money while still getting the same level of service.


For some people, cars really are an essential expense, no matter how unwelcome they may be. However for other people cars—or at least many car journeys—really are anything but essential.

Cars make life a lot easier, there’s no denying it. But as someone who hasn’t owned a car in the last 10 years, let me assure you that you don’t need to give up on life when you give up your car.

Many of the journeys we take can easily be walked or cycled for example. I walk to work and I also carry my weekly shopping home on foot. Sure, it’s not much fun if the weather is being unkind, but overall we manage just fine. Then there is public transport. And lastly, there’s car sharing and lift sharing which can help you get to places that public transport doesn’t service.

I’m not suggesting you necessarily have to give up your car altogether (though if you put your mind to it, it may well be possible). But try being more conscious of your car use. Consider whether you’re getting into your car because you need to or just because you’re feeling “lazy” and another solution would really be just as good, as well as much cheaper.

Credit Cards

I lose count of the number of people who tell me they couldn’t live without their credit card. But a similar number of people have also told me they wish they’d never got a credit card, and how easy it was to wrack up debts that  take years to pay back.

The fact is that while credit cards do have their uses when used intelligently, the interest and annual fees can quickly add up, meaning that it’s possible to end up paying for your purchases many times over. I don’t know about you, but that seems like a crazy idea.

At the most extreme, consider ditching your credit card altogether. Doing so will remove any temptation to spend on it and will force you into making wiser financial decisions an budgeting properly.

At a lower level, if you really want to keep a card for emergencies, ensure that you comparison shop for a card with the lowest interest rate (and ideally no annual fee). Additionally, aim to pay off your account in full each month, so that you pay no unnecessary interest charges.

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Richard, our guest contributor,  is passionate about frugality, lowering your bills and living a life free of financial worries. His brand new blog can be found here.

3 Tips for Vacation Travel on a Budget

Be creative and save on vacation travel.In spring a young man’s fancy turns to love, and for the rest of us, we start thinking about our vacation plans. Of course, with today’s economy we’re specifically thinking about ways to save money on vacation.

With these 3 tips for vacation travel on a budget you can plan for summer vacation time with your family and not worry about smashing your budget.

1. Reduce travel costs.

Quite simply, driving instead of flying is a great way to save on vacation costs. Last time I checked, your car doesn’t charge extra for luggage.

But, if you really want to think out of the box as you work on your plan for summer vacation, consider ride sharing. Ridester and eRideShare are two websites that put riders together with drivers. If your vacation plans include a major city, often you don’t need your wheels after your arrive. This strategy can work.

Much of the Midwest and East is served by Megabus. If you’re really into frugal vacations and can plan well in advance, this is the way to go.

And, if you need suggestions where to go within a “tank of gas” distance from your home, check out this cool tool at TripAdvisor.

2. Explore alternative lodging.

“Youth” Hostels are for the young and the young at heart today. Many major cities have them as well as a lot of smaller towns and even rural areas. This worldwide hostel mobile app is a great way to find hostels and learn more about each facility as you’re drawing up your plan for summer vacation.

Home exchange programs and lodging in private residences is experiencing a surge in popularity due to the Internet and they’re one of the best ways to save money on vacation. You can do a Google search to find groups that facilitate home exchanges. Also, check out Airbnb, which recently boasted offering private lodging in 19,732 cities throughout 192 countries.

Hotel Tonight is an excellent app that connects you with deeply discounted hotel rooms in about 30 major U.S. cities. If you live near one of the cities it covers, you can enjoy a quick, inexpensive, last-minute getaway—perhaps the most frugal vacation of them all.

3. Coupon clip.

Look for deals ahead of time, especially using web-based services like Living Social, Groupon, Sweet Jack and Goldstar. They often feature “adventures” and lodging deals in major cities. The savings can be huge. You might find an activity you couldn’t otherwise afford and build your vacation plans around it.

With a little flexibility and creativity, your summer vacation plan can please everyone in the family, even the person who’s responsible for keeping to a budget.

2 Keys to Starting a Successful Home Based Business

Tips for a home based business or how to make money on the Internet.I started writing these articles to show readers how to make money online and I’ve written about several specific ways to leverage the Internet to improve your finances. I’ve done them all.

Here’s my problem. I’m getting so busy earning money on the Internet that I’m left with little time to share these ideas with you. However, I wanted to share a “big idea” or two that, if taken to heart, can dramatically increase your income and reward you with a strong launch as you’re starting a home based business.

First, Albert Einstein said, “Imagination is more important than facts.”

If you’re struggling to make ends meet, that may be today’s “fact” but can you imagine a better tomorrow? That’s the first hurdle you need to overcome.

For some reason there are people who would like us to think that the rich will always be rich and the poor will always be poor, but that’s not the picture painted by U.S. income statistics.

During the decade between 1996 and 2005, half of all U.S. taxpayers moved to a different income bracket. For example, half the earners in the bottom fifth of income, moved up to a higher bracket by 2005.

At the other end of the scale, 75 percent of the people who were in the top 1/100 of 1 percent of all earners—the most wealthy—fell out of that group. To put it another way, different people came up from below to knock them out of that ultra-elite group of earners. For the top 1 percent of earners, the turnover rate was about 60 percent.

Can you imagine yourself rising above your current income level? These statistics show that it happens all the time. Why not for you?

Maybe you think that’s easier said than done. I want to give you a one-two punch that will help you take the first steps to start a business from home:

  • Figure out how to create value, and
  • Start out small.

I’ve written a lot here about how to make money on the Internet selling on eBay, and Etsy. Underlying all of those ideas is your ability to recognize or find value in something that you can turn around and sell.

I’ve also discussed making videos and writing as ways to make money on the Internet. Writing has been where I’ve been able to create value, and I started out small. The first articles I wrote for the Internet paid as little as $1.50. Some of the articles I write now earn me $100 and I expect that to increase even more over time.

What do you know or what can you do that creates value? Start doing it. If you have a regular job, but you see it as a dead end, start to pursue your “value creating” activity on the weekends or in the evenings. You can start a home business with a very small investment, at least in terms of your finances—you time is another story.

The beauty of the Internet is that it is a low-cost way to reach people. Let’s take two simple examples: house cleaning and catering. These are two businesses you can start on either a full-time or part-time basis.

If you have a presence on Facebook, you already have potential customers, or at least potential references. Let all your friends and family know what you want to accomplish. If you can afford it, build a very simple, clean website to communicate what you’re doing. Make it reflect the value you are offering.

Start small and then ramp up. Again, using our housecleaning and catering examples, you can start as a one-man or one-woman show and as you become successful, add employees. When you’re small and make mistakes, the mistakes are small, but the lessons learned can be huge. The most recent example of this approach is Mark Zuckerberg, who started Facebook with just the students in the dorms at Harvard. Now there are nearly one billion active users.

Find a way to create value, start small and scale up.