Why Frugality Is Misleading: My Experience
A lot of us, including me, have a default approach towards money. Frugality is our go-to approach. The first thing we want to do with our money is to save it. And spend as little as possible, always. I can't say this for everyone, but I grew up with this approach. And now, it is ingrained in my behaviour. My friends and family know my love for frugality. Legend of my frugal behaviour goes around.
But after so many years of semi-unconsciously practising this approach, I have come to this not-so-sudden realisation that frugality is misleading.
* My sister Nittyaa made this on my request. Check out her website here.
Take a breather, don't panic. Let me explain. I'm not discounting the approach as a whole, neither am I questioning its existence. Frugality will always have its place, a very important one in fact. Besides, no matter how much you and I try, we won't be able to root it out. So, trust me when I say this, it won't do you any good as a default action. And I'll tell you why.
First, whenever you are successful in saving money, irrespective of the amount, it gives you a small high. Which is caused by a shot of dopamine being released in the brain. So, this behaviour in itself is very addictive. But what's wrong with this is, you are feeling accomplished as if you've built some wealth, even when you haven't done anything. You can save only as much as you earn. If 10,000 rupees is what you earn, you can save only that much. By no amount of magic will you be able to save more than that. If building wealth is what your goal is, you can't achieve it with this approach. What you might need is another source of income or a raise in your existing one. Besides, putting the effort in creation rather than saving will get your desired goals.
Also, have you ever seen anyone building wealth through frugality alone?
Second, frugality robs you of the pleasure of guilt-free spending. Once you've set up a financial system for yourself, which by the way everyone should, you can afford to do it. Approaching our finances from a strategic place, rather than a place of scarcity puts us in a much better position. You might discover there's no need for haggling over everything. Moreover, spending on things we love brings a lot of joy. And if saving is all that you're gonna do, then there are high chances of the 'victim mindset' kicking in. Soon you'll start to think it's you against the world. Another zero-sum game.
Third, there are chances you might never learn to invest. Invest in yourself, in money generating systems, in a better lifestyle. Looking at potential gains, beyond the initial investments might be particularly tough.
A type of behaviour also called 'penny wise and pound foolish'.
Another thing I observed about this type of behaviour is that it is born out of fear and even scarcity. Fear of running out of something. In our case, money or resources. Summing up, I propose reevaluating our approach towards handling money. Not letting frugality take over, by default. Unlearning the frugality approach that we might have passively picked up.
Right now, I'm in a stage of life where I'm reflecting on my own behaviour, habits, reaction approaches, nature and beliefs. The example of frugality being misleading is one of the many behaviours that I have passively learned. Such things are incapable of serving me any longer. Sadly, unlearning them is much difficult than it was learning. But that is where growth lies.