I was recently invited to a grand opening of a restaurant in Singapore. As part of the grand opening celebration, the restaurant was providing free food and beer. But the food was mostly “junk food”. Most people were happy with free flow beer, but since I don’t drink anymore and I didn’t consider the “junk food” to be a proper meal, I stayed a bit to revel in the atmosphere, and then left to have dinner.

Most people would say, “Hey, I thought you were frugal. Why didn’t you stay to eat so you can save money?” This is where I would have to remind people that being frugal does not mean being cheap. Sure, a cheap person would have stayed and had all the junk food and beer his/her stomach can handle, but a frugal person considers the ROI (return on investment, with investment meaning not just money, but time and other resources).


Can Spending $10,000 Be Frugal?

As a CFP (CERTIFIED FINANCIAL PLANNER™), a guy once asked me whether it was frugal to spend $10,000 on a holiday. He told me that he and his wife were constantly fighting and he thought the holiday would “help them reconnect and save their marriage”.

I told him that being frugal is about the ROI, not about spending below a certain amount. I told him that if I had to pay $10,000 to save my marriage I would do it in a heartbeat, because to me, it would be an absolute bargain. But I would look into making that $10,000 have the best ROI. And that perhaps means using it for counselling or earmarking it for a series of dates which might produce a better and longer lasting ROI.

I think as a frugal person, it’s easy to slip into the penny wise and pound foolish mentality. For me, when I first realised that half the population lives on <$2 a day, and I did absolutely nothing to enjoy the “wealth” that I have that many may never experience (clean water, good sanitation, constant supply of electricity, hot showers, etc.), I went through a period of guilt and repentance.

This translated into a period of being an extreme cheapskate where I made, reused, and DIYed nearly everything to cut my spending as close to zero as possible – and it was hard work and exhausting. I grew vegetables, herbs, fruits, and nuts; now I don’t have the space/time to grow much. Of all the things I’ve ever DIYed which most people buy – butter, yogurt, cheese, kimchi, apple cider vinegar, tofu, soy milk, ice cream, beer, sausages, pasta, bakkwa, soap, toothpaste, deodorant, and cleaning solutions –  I now just make a few items sparingly and buy the rest.


After spending 5h making gluten-free bread with okara (the leftover pulp from making soy milk, which took 1h). the ROI for me was just not worth it.


Consider The Tradeoffs

These days, I take a more balanced approach, knowing that there are tradeoffs in everything, even in “free” or “cheap” things. Often the tradeoff is time, which could have been spent building/maintaining relationships, learning a new skill, advancing in a career, or building a company. Another common tradeoff is physical or mental energy, which also could be spent in other, more rewarding ways. And a third tradeoff is space.

I also acknowledge that I have a relative abundance so I can put these tradeoffs into the proper perspective. For those who are unemployed, money is tight while time is abundant, so being “cheap” may be essential for survival. For others, time may be scarce, and being “cheap” may not result in an optimal ROI (according to one’s personal values).

So why do I continue to advocate that we all spend less? Because most people are spending way more than they think they’re spending, and they need to recalibrate their sense of affordability. Most people don’t have enough saved for emergencies, let alone their basic living needs in old age. Our wants are nearly infinite, yet our needs are actually few. And most people mistakenly believe that spending money and acquiring a lot of stuff will make them happy. This hyper-consumerism is already doing quite a bit of harm to our world.

But that doesn’t mean you ought to skimp out or cut corners on things like health maintenance (including mental health), insurance coverage, educational needs, relationships or other important matters so that you can fatten your savings. Being pound wise means that you don’t ignore the “big stuff” (i.e., what’s important to you, your values, your life goals) in pursuit of life’s “pennies”. And boy do we have many “pennies” these days that masquerade around as “pounds”.


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