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By Carol Church

Frugality can be a really, really good thing, as most of us know! Learning how to spend less money and save more can benefit families in the short and long term, allowing them to build an emergency fund, save for retirement, put away money for their children’s education, improve their homes, and much more. Plus, having the power to bring down spending can feel very powerful, giving families more freedom and “breathing room” and creating peace of mind. These issues may feel especially intense to military families.

But have you ever known someone who got so focused on saving money that he or she made choices that were actually not so smart? It’s something to be wary of, especially in families where budgets have become unexpectedly tight, anxieties are high, or there might be a feeling of compulsion or control around money. Following are some examples of times when an overfocus on “frugality” or “bargains” can end up being financially foolish (or unwise in some other way). All of us who are interested in this topic need to keep an eye out for these tendencies.

  1. Skipping needed maintenance of home, car, or health. It’s not always cheap taking the car into get needed work done. It can be tempting just to ignore that strange spot on the ceiling. And nobody loves to go to the dentist! But when we put off routine maintenance, like annual physicals or checking the oil, or avoid calling a professional to handle a developing problem, we take a very real risk that a small cost will balloon into a huge and potentially catastrophic one. Ouch!
  2. Not valuing your own timeIf you really want to save money, research is your friend, and so is comparison shopping. Deals are out there waiting to be had, whether we’re talking about groceries or a new TV. However, unless you truly and genuinely enjoy spending hours cutting out coupons, driving all over town (don’t forget about gas!), or searching the Internet for a price that is just slightly lower than the first one you found, it pays to remember that “time is money.” In fact, you might be able to spend that time doing something else that actually saves you or earns you more.
  3. Underinsuring…or not insuring at all. Figuring out the right deductible for your car insurance, home insurance, and health insurance (if you have the ability to choose) can be complicated and is worthy of its own post. But keep in mind that you definitely should to be able to pay whatever your deductible is out of pocket, without having to borrow– or you are “borrowing” trouble. Also, in the case of health insurance, remember that most of us will probably need to use that insurance—and shouldn’t spend a lot of energy trying not to. Also, don’t make the mistake of not purchasing renter’s insurance or life insurance.
  4. Cheaping out where you shouldn’t. If the cheap but important item you buy is going to break or wear out quickly such that you need to replace it, it wasn’t a bargain after all. Of course, some things can be bought inexpensively (especially when purchasing used) with no concern, but items that receive heavy or repeated use deserve careful consideration. In my personal experience, cheap shoes, particleboard furniture, and cheap appliances have all been a poor bet in the long run. 

    Photospin/ Stuart Miles

  5. Over-couponing, over-saling, and over-Grouponing. Ever been unable to resist a Groupon or other special offer, then completely forgotten to use it? I have. Although you can actually get back the amount you paid in most cases, you may forget, and the “bargain” aspect is certainly gone. Other people who get so starry-eyed over coupons that they buy a product they don’t even like, or purchase an expensive item they would not have spent on “because it was such a good deal.” This is not a great idea, as most of us probably know in our hearts. If you find you have a tendency to get overexcited by deals in the heat of the moment, consider implementing a “cooling off period” where you wait at least a few hours, and preferably a day, to make that tempting “bargain” purchase.

There’s no doubt that making careful choices and looking for good deals is often the right choice to help families save money and build savings. However, families may sometimes need to take a step back and consider the long-term wisdom of their decisions, especially when emotions or anxieties are running high. Good luck to you and the families you work with in making sound budgeting and spending choices.