Thrifty People: Well Off or Out of Necessity?

[Soben]

In poverty, you are getting through day by day, week by week. You think a week ahead.

In the middle class, you are putting away for college and retirement. You think to the end of your life.

The wealthy think of wealth generationally.

I think this is different for immigrants. The ones I know definitely think generationally. Regardless of the county of origin, they're thrifty and focused on improving their children's/grandchildren's lot in life.

I think that everyone likes to think they're thrifty. I know I do, but I still want to go to WDW, the Unthriftiest Place on Earth.

 

[fae]

I would say it's mostly the "well off"/not struggling in my circle of friends/family. My dad is the cheapest person I know and my parents make probably double the national average household income. The only things he'll splurge on are vacations and myself/my sister.

In general, my family is doing pretty well, but they don't like to spend money on non-necessities for themselves. We're pretty recent immigrants to the US (the 1970s) and I think that their past keeps them pretty frugal. They're very liberal with gifts and donations, though.

 

[TrueLove's1stKiss]

For the most part the frugal people that I know are also the most financially intellegent and well off.

 

[ExPirateShopGirl]

If I needed new winter clothes I wouldn't head to a thrift store OR Kohl's OR Limited. Well-made non-trendy clothes last indefinitely. Wait for a sale if you must.

People throw away good money every day by purchasing cheaply-made goods designed to last only a very short time. Clothes, furniture, you name it.

Here is my scenario that prompted me to write this thread:

I needed some new work clothes for winter (I have always traveled for work and had previously been traveling to warm climates...now I travel to work in Northern MN).

I figured I needed some new sweaters and dress pants, plus some dress shoes that will do well in the snow.

Where did I go shopping? Goodwill. I could not even think of going to the mall or buying clothes full price until I had checked out the Goodwill to see what used clothes I could buy. I got 4-5 new-to-me tops/sweaters but they did not have any pants in my size in a modern style. So...I wrung my hands and bought a single pair of pants at Kohls with a coupon I had. Still haven't found shoes. I tried on some pairs that I think will do well at the shoe store, and I'm currently scouting eBay to see if I can get them at a bargain price.

Driving home, I thought about it and I figured that most people I would know head to Limited, Express, or one of those stores if they needed new clothes and wouldn't think twice about it.

DH and I are currently in top 10% of income earners (so very blessed to be in our current job industry) and could afford having cable TV, buying all our clothes at the mall, etc. but don't.

Not making a judgement...just an observation.

 

[jensen]

In your life, would you say that the thrifty people you know tend to be rather "well-off" or tend to be people who need to be thrifty out of necessity?

To get more specific, would you say that the people you know who "count every penny and stretch every dollar" tend to be people who are doing okay in the income-department and just like getting the most bang for the buck....or people who need to do so for their family to pay all their bills?

In my experience, the people who I know who are the biggest "penny pinchers" (myself included) are people who are doing well financially (good income, nice home, etc.) and some of the biggest money wasters are those who don't have a lot of money to spend.

I understand that we do not always know the ins and outs of the finances of everyone that we know, just wondering if anyone else has noticed similar (or opposite) generalizations.

I tend to think that those who are "well off" at least in part got to that point by being very budget-conscious.

Personally, I can tell you that my parents were thrifty out of necessity. They came from very poor families and were raising 5 kids, so every penny saved... They have nothing brand name, drive basic cars and enjoy finding gems at thrift stores that they can revamp and make into something special.

But, being thrifty has also paid dividends to them... today they have no debt, a nice retirement sum, own three homes and travel the world. They are not wealthy. They simply have spent their money on what's really important to them.

I try to live by their example.

 

[NorCalGal]

I was grocery shopping - After going through the local stores circular
to "Cherry Pick" the bargains...They had some brand of Pasta @ 2/$1
(remember 2/$1 pasta)?
So...I was kinda hungry for Rigatoni - but it was not on sale...It was .68cents a LB. Box-The other Pasta shapes were only .50cents...Hmmm...Hmmm

I paused and pondered over that .18cents...
I got the 2/$1 Pasta....

That night after dinner, without hesitation, I went online and made some ADR's @ The Rose & Crown Pub for Illuminations($200 Check) - The Coral Reef Lunch($100 Check) and Sci Fi Dine In($100 Check)

This is me exactly! I have a good retirement income, and a decent amount in the bank, but I like the challenge of seeing how "budget" I can be - except when it comes to travel and Disney. I do have a certain amount per month that goes in my travel fund, and I don't dip into other accounts, but I actually put almost as much in that account as I pay for rent!!!

 

[honeydiane1953]

IMO the thrifty/stingy friends are not rich but are very comfortable and pinch pennies. This infuriates me to no end. I of course am broke and love to spend money.

 

[Colleen27]

People throw away good money every day by purchasing cheaply-made goods designed to last only a very short time. Clothes, furniture, you name it.

And think they're being thrifty while doing it. That drives me absolutely crazy... I have a friend who just loves to brag on her great deals, usually from Walmart or Big Lots. I swear she's replaced her "great deal" $10 toaster at least 5 or 6 times in the years I've had the $30 Cuisinart (60% off of retail plus a stacked coupon - a great deal in my book!) that she insists is only more pricey because you're paying for the name.

 

[DawnM]

Why does it infuriate you? Why do you care?

IMO the thrifty/stingy friends are not rich but are very comfortable and pinch pennies. This infuriates me to no end. I of course am broke and love to spend money.

 

[stsomewhere]

Also I think there is a concept of "worth".

See for me since I tend to buy more "classic" styles that never go out of fashion I tend to spend a lot on my clothes. I hate kohls because imo every thime i buy some thing out of there it shrinks or fades within 2 washings.
I'd rather pay 150 dollars for a nice pair of well made lined black pants than a pair of 29.00 slacks from kohls that are thin, cheaply made (seams showing) etc. Now what's interesting for me is that, some things I'm thrifty about. Like jeans. Jeans and sneakers are really not worth much to me so I won't spend much on them.

Same thing with cable (or actually any thing). I use to have a full package but simply got tired of paying for lousy tv, so now I have the basic package to get internet service and I use redbox when I want to rent a movie.

Remember also we are on a board that is specifically for a luxury item. Disney. I know a lot of folks who think Disney is a huge, gigantic rip off. they are millionaires and wouldn't dream of dumping the money we spend at the mouse world. I also know folks who are squarely upper middle class that watch their pennies and are very thrifty during the year and when they go on vacation, it's first class all the way. so what category do they fall into?

There are just a lot of "factors" that go into how and what I spend money on.

I agree about clothing. I would rather have one pair of expensive jeans that I love vs. lots of cheap stuff. I hate Kohls. Their clothing is horrible.

 

[apnep]

Partially well off and partially out of necessity. We are pretty frugal people and only shop out of necessity or shop sales. We don't live in a fancy shmancy house but we know how to enjoy ourselves when we want to and living like this has given me the ability to be a SAHM for my kids. We like to save for trips or things we need. Ocassionally I will take on a part time job if needed.

I have done most of the remodeling/maintenance in our house. I remodeled our kids bath and now I'm working on our master bath. I have built my own cabinets, mirrors, tiled, painted, etc...could I pay someone to do all that? Sure, but why pay a ton of money when you can do it yourself and get everything you want for less than half the price. Plus we cherish it and appreciate it more.

We look on Craigslist for certain items, and as a matter of fact I'm going to Goodwill tomorrow to look for an end table.

Being frugal is not a bad thing!

 

[fall08CP]

Have you ever read Ruby Payne's "Hidden Rules of Classes"? It explains how different social classes make decisions. When it comes to money, poverty class spends money, middle class manages money, and the wealthy invest. While controversial, I've lived in both middle class and poverty, and I see that play out. The poor are more likely to help their friends out financially than middle class.

NPR recently had an article explaining that poor and middle class spend about the same on rent and transportation costs over the year, so the working poor's earnings don't go nearly as far. When they do have disposable income, they tend to spend it quickly. In my opinion, it's just a difference in culture, not a frugal vs irresponsible concept. Just food for thought

 

[Robbi]

Have you ever read Ruby Payne's "Hidden Rules of Classes"? It explains how different social classes make decisions. When it comes to money, poverty class spends money, middle class manages money, and the wealthy invest. While controversial, I've lived in both middle class and poverty, and I see that play out. The poor are more likely to help their friends out financially than middle class.

NPR recently had an article explaining that poor and middle class spend about the same on rent and transportation costs over the year, so the working poor's earnings don't go nearly as far. When they do have disposable income, they tend to spend it quickly. In my opinion, it's just a difference in culture, not a frugal vs irresponsible concept. Just food for thought

I don't agree with the underlined. People here have stepped up to help their neighbors during the tough economic times of the past few years.
In sociology we did learn that poor people will spend beyond their means on clothes, middle class people on cars and wealthy people on houses. These are the upper status symbols of each economic tier. Of course, this does not hold true for every person of each class but is representative.

 

[disykat]

Have you ever read Ruby Payne's "Hidden Rules of Classes"? It explains how different social classes make decisions. When it comes to money, poverty class spends money, middle class manages money, and the wealthy invest. While controversial, I've lived in both middle class and poverty, and I see that play out. The poor are more likely to help their friends out financially than middle class.

NPR recently had an article explaining that poor and middle class spend about the same on rent and transportation costs over the year, so the working poor's earnings don't go nearly as far. When they do have disposable income, they tend to spend it quickly. In my opinion, it's just a difference in culture, not a frugal vs irresponsible concept. Just food for thought

I think this is the chart I saw that I referenced earlier.

 

[aboveH20]

What an interesting discussion you've started. I've enjoyed reading the responses. A number of years ago I read The Millionaire Nextdoor and basically the premise of the book (maybe premise isn't the right word, it's a non-ficiton book) is that the person on your block in the modest house, driving the older car, mowing their own lawn, eating in, etc. is frual not poor.

 

[Samar]

DawnM: Why does it infuriate you? Why do you care?

I highly doubt that poster was seriously infuriated.



****My 2 cents. We blew through more money when DH's income was significantly less. Brand names were key. In all fairness, I was not aware of the amount of debt we were in until 2 1/2 years after we were married because he said that the money was "nothing to worry about" (manly ego) He called me one day while I was in Florida to visit family and close to being due with DD #1 and broke the news to me that things were looking grim. After initial anger and upset, acceptance that we needed to turn things around came through.

After she was born, he was hired by a new company and now we are much more conscious about spending, we split our bills to balance our money through the month and we only buy things as needed (my almost 8 year old is still wearing her clothes from 2-3 years ago because they still fit, why spend for a whole new 2012 wardrobe? I have clothes from much longer than that!).

Are we extreme couponers? Absolutely not. I find it overwhelming. But I do try to find a good deal before spending and make Goodwill visits when possible.

 

[jensen]

Have you ever read Ruby Payne's "Hidden Rules of Classes"? It explains how different social classes make decisions. When it comes to money, poverty class spends money, middle class manages money, and the wealthy invest. While controversial, I've lived in both middle class and poverty, and I see that play out. The poor are more likely to help their friends out financially than middle class.

NPR recently had an article explaining that poor and middle class spend about the same on rent and transportation costs over the year, so the working poor's earnings don't go nearly as far. When they do have disposable income, they tend to spend it quickly. In my opinion, it's just a difference in culture, not a frugal vs irresponsible concept. Just food for thought

Wow! This is so interesting... I have an uncle who has amassed a great fortune. And, just in the past 5 or so years we have started to see the changes in his personality where he's moving from his poor/middle class upbringing to the kind of person described above as wealthy.

He built a gigantic new home for his family. He's prepping his children to take over his different business affairs. I think, in his heart, he'll always be middle class. But, I'm seeing the "building a legacy" thing come out, so that future generations of his family will likely be in the wealthy category.

We all know the stories of Sam Walton and his old truck. Or Warren Buffet and his family home. Many times, the people who work to amass the initial fortune don't consider themselves wealthy... it's their future generations who take on that role.

 

[jensen]

First Story - We live prudently, Middle Class, Not wealthy, Not Poor.
I was grocery shopping - After going through the local stores circular
to "Cherry Pick" the bargains...They had some brand of Pasta @ 2/$1
(remember 2/$1 pasta)?
So...I was kinda hungry for Rigatoni - but it was not on sale...It was .68cents a LB. Box-The other Pasta shapes were only .50cents...Hmmm...Hmmm

I paused and pondered over that .18cents...
I got the 2/$1 Pasta....

That night after dinner, without hesitation, I went online and made some ADR's @ The Rose & Crown Pub for Illuminations($200 Check) - The Coral Reef Lunch($100 Check) and Sci Fi Dine In($100 Check)

Moral Of The Story...We were able to do this because we lived day to day prudently. We lived & Still live under our income.

2nd Story to follow...

OMG! I LOVE this because it's me to a "T"! I'm frugal in many ways to pay for the expensive things I really want.

I always tell my kids, it's not that we make any more or any less money than most of their friends parents. It's all about how we choose to spend our money. While their friends are wearing brand name clothes and playing with American Girl dolls, most of them have never been on family vacation, let alone Walt Disney World a half-dozen times.

 

[SamSam]

OMG! I LOVE this because it's me to a "T"! I'm frugal in many ways to pay for the expensive things I really want.

I always tell my kids, it's not that we make any more or any less money than most of their friends parents. It's all about how we choose to spend our money. While their friends are wearing brand name clothes and playing with American Girl dolls, most of them have never been on family vacation, let alone Walt Disney World a half-dozen times.

This describes us too! We have DVC and go to Disney often, as a consequence people tend to think we're rich. We're not, we are very frugal in other areas of our lives. We don't remodel our house every 3-4 years (like some neighbors), in fact it's been many years since we've done more than basic maintenance, we mow our own lawn, clip coupons, cook at home, don't buy name brand clothes, etc. However, we love to travel and we enjoy eating out at nice places during trips.

 

[Colleen27]

OMG! I LOVE this because it's me to a "T"! I'm frugal in many ways to pay for the expensive things I really want.

I always tell my kids, it's not that we make any more or any less money than most of their friends parents. It's all about how we choose to spend our money. While their friends are wearing brand name clothes and playing with American Girl dolls, most of them have never been on family vacation, let alone Walt Disney World a half-dozen times.

That's us too. When DS asks why we don't buy the video game system of the moment or DD starts talking about her BFF's collection of zhu-zhu pets or some other trendy little whatnot, I remind them why we don't have those things... Because those same friends have never left our state, don't go to the concerts and ballgames and shows we go to, etc. We live frugally day-to-day in order to afford the things that matter most to us.