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Smart Frugal Living Tips – If you are reading this article, you have already leveled up. You are actively seeking ways to save money in this modern era. You want to know the tips and tricks for living simply, avoiding unnecessary purchases, managing a small budget, and stopping inflation from eating up your finances.
Before we dive in, you must identify what stops you from saving. What is draining your money? Is it buying fancy food, daily coffee runs, or frequent snacking? Whatever it is, think about every single expense. Start small—even just buying a drink. Think about it and write it all down.
Once you have recorded and recalled all your spending habits, compare them with the tips and tricks below. This will help you understand the direction you need to take to stop this wastefulness.
1. First In, First Out (FIFO)
Sounds like warehouse management, right? Hehe. The meaning here is: buy an item only once. Use it until you really, really can’t use it anymore because it’s broken or obsolete. Only then should you buy a replacement.
For example, you have a laptop with Core i3 performance. You want to upgrade for better speed. Before buying a new one, sell your old laptop or use it until it dies. Only then are you allowed to buy a new one. By applying this, you will be more frugal with goods. You won’t have too many items with the same function. Another example is shoes. Buy one pair. Wear them until they are worn out, then replace them with new ones.
2. Create a Monthly Expense List
Record all monthly necessities. You are obligated to do this. Write it in a notebook, Excel, or Google Sheets. Just like I do—I record all family expenses in Google Sheets. I monitor everything: electricity, water, wife and child expenses, driver’s license renewals, WiFi, hosting fees—everything is written down.
I calculate until I find the “net money” I can save. This way, I’m not afraid of sudden expenses because I know what has been paid and what debts are outstanding. Calculate your total expenses, subtract them from your monthly income, and that’s it—your net money. Remember, list fixed expenses, not uncertain ones. If you want to eat out or refresh, make a separate budget for that.
3. Create a Daily Allowance
After creating a monthly expense list, you will have your net financial data. Divide this net money into a daily allowance.
For example: Your calculation leaves you with 1.5 million. You allocate 500k for investment, leaving 1 million. Divide this 1 million by 30 days (or until your next payday). 1,000,000 / 30 = approx 33,000. So, your maximum daily spending is 33,000. If you exceed this, you must “borrow” from tomorrow’s allowance. If you only spend 10,000, great! You save the rest. This teaches you patience. If you want a headset worth 100k, you must save your daily allowance for 3-5 days to buy it.
4. Set Aside Money for Investment Immediately
Following point number 2, once you have your net money, invest it immediately. Not necessarily in volatile stocks or crypto. Keep it simple. Invest in a Money Market Mutual Fund. That’s enough. Unless you are an expert, then feel free to put it in Indonesian stocks, US ETFs, Gold, etc.
It is crucial to set this aside at the beginning, not the end. Saving is done upfront. If there is money left at the end of the month from your daily allowance, that’s not for investment—that’s your reward! Use it for “me time” or good food because you succeeded in being frugal. Hehe.
5. Distinguish Wants vs. Needs
This might deserve its own article, but briefly: The easiest way to distinguish them is to ask, “If I don’t buy this, will I be unable to function?”
- Example 1: You want a new phone. Ask yourself: “If I don’t buy it, what happens?” If the answer is “I can’t play games” or “It feels slow,” but you can still communicate, that is a Want.
- Example 2: You want a new bag. “If I don’t buy it, what happens?” If the answer is “I can’t carry my laptop to work,” then that is a Need.
Conclusion So, how about you? Can you accept these tips and tricks? If you want to ask questions or even refute these tips, show me what your version of frugal living looks like! Or maybe you have other methods not listed here? Drop your thoughts in the comments below. Let’s share the benefits with other visitors!
