People choose to live in frugality as a way to keep more of their hard-earned cash in their pocket. Well, there’s no wrong in saving to secure your future finances. But don’t be extremely frugal to the extent you’re being labelled as cheap by your friends. Being overly frugal can do more harm to your wallet than it actually helps. Here are a few ways of being too frugal can end up costing you more in the long run.
Buying an insurance policy can be seen as a waste of money to some people since they don’t see the importance of it other than paying the monthly premiums to keep it going. They sign up for mediocre insurance policies to keep the premiums low and save the money for other purposes. But imagine, should something undesirable happen to you or if an emergency arises, what would happen to you and your family?
On the hindside, it’s good to shop around before getting one to avoid overpaying for your insurance policy. However, do not choose a policy solely based on the price. Try looking at other aspects and coverage offered by the policy that can meet your needs. You could risk yourself and your loved ones by purchasing the cheapest insurance in town. In other words, don’t be penny-wise, pound foolish.
Being too frugal with cheaper and potentially poor quality products can drain your bank account even more. A high-end product may be a little costly but it can save your money in the long run with a warranty that comes with it. An energy-efficient refrigerator, for example, may not be the cheapest option but it can save your energy bills over time. Apart from buying on a price basis, try to buy things by looking at the quality too.
By being too fixated on the price could eventually cost you more in the long haul when you frequently replace cheap products that fall apart. You typically get what you pay for. Buying a high-end product could still be a frugal choice if you know that it’ll last you longer. It’s worth investing in things that can withstand the wear and tear if you use them regularly.
You might be able to save some money by skimping on car maintenance but in the long run, you will be facing more expensive car repairs. One major repair from years of neglect can drain more of your savings than the maintenance cost itself. Avoiding car maintenance does not only end up hurting your wallet but it could also put your life at risk on the road. Hence, consider following your regular maintenance schedule to keep your car in a tip-top condition.
Being too frugal affects not just your wallet but also your wellbeing. Skipping your yearly health check or refusing to see a doctor when you need to only further jeopardizes your health. Remember that prevention is better than cure. You may opt to skip your dental check-up every 6 months but in the meantime, you’re putting yourself at risk of potential oral diseases that’ll go undetected until it’s too late.
While eating clean may cost more than what you regularly pay for, replacing nutritious food with an unhealthy diet can be bad for your waistline and health as a whole. Your grocery bills might be slightly higher but consider that as an investment for your wellbeing. By sticking to a healthy diet plan, you can lower any potential medical cost over time.
Some people find themselves burnt out after months of living in extreme frugality which leads them to binge spending. That’s something that we’d definitely like to avoid. Rather than solely concentrating on frugal living and saving every penny earned to the point that it robs you of your happiness, a better way to build your wealth is to increase your income and invest when you have sufficient savings to grow your funds.
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