“Are Your Frugal Habits Actually Costing You in the Long Run?” – Grow

We’re talking about spending hours clipping coupons to save a couple bucks on groceries, driving to an off-your-route gas station because it’s slightly cheaper or sifting through sales racks (full of cheap clothes you’ll ultimately replace) instead of saving up for a nicer-quality item you really want.

Why We Do This

Turns out, deal-hunting is in our DNA. “We’re irrational beings, swayed more by emotions than logic. When we hear about a ‘great deal’—even if it’s a few towns over—we get emotionally activated and focused on the possibility of missing out, as well as the joy we will get for ‘getting the prize,’” says psychologist Ben Michaelis, Ph.D.. “This leads us to jump in the car without thinking about the true costs.”

Here’s What to Do Instead

Don’t beat yourself up over letting a good deal get to your head. “The key is to know that these are natural ways of thinking and that, with just a little effort and planning ahead, you can correct for them,” Michaelis says.

So next time you feel the itch to employ one of your less-helpful frugal habits, take a minute to think it over. Is DIYing a sink repair really the best use of your time? (Could you actually make it worse?) If the answer’s not so obvious, calculate how long the task will take compared to how much your time is worth.

To calculate that, consider how much you could be earning doing something else—say, working on your side hustle or taking a class that could help you grow your income down the line. If you could potentially earn more than the amount you’re saving in the same timeframe, it probably isn’t worth it.

The Bottom Line

Ditching unhelpful “frugal” habits doesn’t just protect your time. It also allows you to focus on more time-consuming (and rewarding) activities, like negotiating with customer service reps for a lower cable bill or cell phone plan, or learning how to redeem credit card rewards for your next vacation, which can save you hundreds over time.

You can also use your freed-up time to think up new, dynamic ways tosave more skillfully—say, by spending five minutes setting up an automatic savings transfer—which has a much greater impact over time.

This article was originally published on Grow

 

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