Steadfast FinancesNew Frugality Appears to be More than Just a Fad

New Frugality Appears to be More than Just a Fad

Filed in Budgeting , Frugal Living , Saving Money 14 comments

When the world’s most bullish, pro-consumerism news channel suggests a new frugality movement is taking root, you know it’s more than just a fad.

Perhaps this quote sums it up best…

Both [interviewees] say their new frugality may be permanent, even if their finances improve. I don’t see any reason to go back to being frivolous with what we have [as we were in the past].

Somewhere, a marketing guru just lost his wings!

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Fact is, the frugal living movement has always been around. It just wasn’t as fun or as popular as the spendthrift lifestyle so heavily promoted during the last decade.

Which is why those of us who practiced the lessons learned from the Great Depression found the Great Recession as a time to thrive, not suffer.

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Posted by CJ   @   20 November 2009 14 comments
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Nov 20, 2009
10:11 pm

Matt – I REALLY don’t believe frugality will stick at all!

We are Americans, and will binge spend 4 life! It’s just the way we are. The American way will always live on in America.

Nov 21, 2009
12:00 am
#2 Matt SF :

I dunno man. I’m thinking frugality, or at least an alteration in spending for value versus spending just for spending, will stick to those who were hurt by the recession.

Of course, it’s a pretty unlikely prediction to make considering that most people seem to have a very short memory and we live in a world where advertisements inundate our life 24-7. Then again, once they see how quickly the savings can add up after just a few months, they may like the peace of mind instead of getting a new iPhone every 2 years.

Nov 21, 2009
9:27 am
#3 Financial Samurai :

I was pretty hurt by the recession, and I’m still thinking about buying $10,000+ watches, and a new Land Rover 4 that’s around $60,000! The recession hasn’t changed my THOUGHTS, although it may have changed my actions.

That said, once bonuses hit this year, and they should be up a lot (as u know with GS paying $600-700k/employee), most people will probably freely spend.

You take the survey of spending 1 month before you know your bonus leads to VERY different results 1 month after getting your bonus!


Nov 21, 2009
10:00 am
#4 Matt SF :

Yeah, but you’re a finance guy… you’re supposed to be buying that stuff for the good of the economy! ; )

Nov 21, 2009
10:16 am
#5 Hank :

Matt, I’m with the Financial Samurai on this one. As soon as unemployment stabilizes and starts to retreat back to a normal level, Americans will soon go back to their old spending habits.

Nov 21, 2009
10:44 am
#6 fwisp :

The problem lies in our human nature: we naturally want things, nice shiny things. So as long as there are options to get those things (credit cards) we will have to fight with ourselves every second of the day because there are so many temptations everywhere you turn…

Nov 21, 2009
11:44 am
#7 Matt SF :

Man, just when I turn a little positive and think we’ve finally learned our lesson… I get a smackdown! (said facetiously of course)

I think there will be a few converts, but do concede that the temptation and constant stimuli to get Americans back to living beyond their means will win out.

Thanks for the comments gents!

Nov 21, 2009
11:59 am
#8 Financial Samurai :

Matt – As a trader, aren’t you a finance as well?

Time to BINGE spend everyone! It’s good for you!

Nov 21, 2009
12:04 pm
#9 Matt SF :

I’m more the cheap bastard type.

I was a frugal-ite way before I became a trader.

Nov 21, 2009
12:43 pm
#10 fwisp :

Oh look they have 52″ LCD TVs on sale in BestBuy ;)

Nov 21, 2009
12:45 pm
#11 Matt SF :

Yeah, but might not do the Financial Samaria any good since California might not let him buy one! (evil grins)

Nov 22, 2009
8:37 pm
#12 Abigail :

Sorry, I don’t buy it. (No pun intended.)

Yeah, the people in the Great Depression lived that way for the rest of their lives. We’re nowhere close to those dire circumstances.

There really is no way of telling if this frugality will last until we can look at it in hindsight. That said, every time we’ve had a nasty financial problem, the spending righted itself at the same as the economy.

And there is an ever-growing number of new, cooler items that are “must haves” for everyone. The people who lived through the depression tended to isolate themselves (at least my grandparents did) from a lot of technology and conveniences. In doing so, they stayed away from the temptation of most technology.

Today, that’s really not all that possible. There are too many gadgets being invented and upgraded at any given moment. Too many items that can fit in so well with your lifestyle that you hardly even think of them as a luxury.

Generally speaking, if we’re not watching TV, we’re online or have access to the Internet via our phones. That means we spend most of our waking moments looking at ads, reading articles about new technologies, etc. There’s just no way to avoid the materialistic urges that this 24/7 stream of information creates. Well, other than something radical like turning off the TV and leaving the laptop at home. (Then just try to avoid looking up at billboards or in store windows and you should be fine. So long as you don’t listen to the radio ads.)

Nov 22, 2009
10:00 pm
#13 Matt SF :

@ Abigail,

Thanks for chiming in Abigail. You bring up a very important point, and you’re correct, it’s doubtful the advertising industry would allow us to remain frugal forever.

I’ve always equated advertisers to a spoiled screaming child… *pay attention to me, I need you do to buy me XYZ.*

But what I would like to see is a study on the efficacy of advertising when you saturate every possible niche to place those advertisements. Naturally, the more you experience an external stimulus, the less you pay attention to it.

For example, when was the last time you (as a blogger) actually read a block of Google Adsense links or sat around a guy who watched the TV commercials between a football game?

Personally, I don’t even see the ads anymore. I go directly to the web content I’m looking for, flip the channels, or leave the room to do something else. So even though most people are being exposed to the ads, they have little to no effect on a substantial portion of their viewers/readers/listeners.

Forgive my science geek analogy, but I think we’re rather like antibiotic resistant bacteria in this hypothesis. It takes more and more antibiotic (advertising) to kill them off (get our attention) until eventually they evolve total immunity.

That could be why we’re beginning to see new types of TV ads with the rise of DVR. The “pause ads” or the 30 second commercials are good examples of consumer psychologists trying to get our attention.

Nov 23, 2009
3:27 pm
#14 Ashley :

I wish it were here to stay, but I don’t believe it, not yet. The economy trembled, but it didn’t totally fall. People will have to totally stop giving and accepting credit for any real changes to occur. Being a cash nation again may not be as horrible as people think it would be.

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