Is Your Lifestyle Worth Saving?

Question: With the current economic crisis, what should we do to protect our
family and lifestyle?


Answer: Do what frugal and smart people have done for years:
Live below your means. In the 1970’s most people saved more than 10 percent of
their income. In recent years that figure dropped to 2 percent or less; most Americans
have been spending their savings and not setting anything aside. This is not a
smart way to live.

You’ve got to have emergency reserves and if you ever plan to retire or
at least work less, you’ve got to have money saved. If you can’t currently put
money aside, do what ever it takes to start doing so. Have a garage sale, sell
stuff on Craigslist or eBay and put the money in the bank. Or you might
consider renting a room or selling your house. Be brutal, but do something to
cut your expenses so you can put money in the bank each month.

The second thing to do is to question whether your lifestyle is really
worth protecting. Bigger houses and more stuff are not always better and
definitely don’t guarantee happiness. If your lifestyle and its accompanying
bills are causing more stress and less joy, it’s time to jettison those things
and simplify life.

We’d rather live in a smaller house, with smaller utility and tax bills,
so we can sleep peacefully at night and put some savings in the bank rather
than to live big and have stress. Our part of stimulating the national economy
is to make sure that our household finances are not in need of a bailout and
that we have a little extra to help others who can’t afford to put food on the
table.

Our first book, America's Cheapest Family Gets You Right On The Money talks about our lifestyle and how we strive to keep our overhead low by refusing to borrow money or take on payments. By saving in advance for all anticipated expenses, we've been able to live completely debt-free and get all of the things we need.

Frugality doesn't mean a life of deprivation—it means a life of freedom and fun!