Frugality disease is a mental disorder in which the person just can’t shake the negative feeling of spending money. They can’t even get over the hurdle of spending money for essential items such as toilet paper, food, and water. They still try to look for a cheaper option even if the option in front of them is good enough.
There’s nothing wrong with penny pinching here and there. However, once someone feels pain from not penny pinching is when it becomes clear that it’s a problem. I get it. It feels good to save money here and there. After all, money is what allows us to live and put food on the table.
However, there comes a limit to that. Too much saving money is a sign of a mental disorder that needs to be fixed. As someone who’s saved and invested their money for 6+ years, I realize I’m more frugal than the average person. However, I’m not so frugal that I neglect life essential items such as insurance, cars, food, and the like.
Frugality disease is something that is on the rise with many people partaking in the FIRE movement. Not eating out often is good. However, not eating out at all throughout the year isn’t a good option. We need to enjoy and have fun once in a while with the money we amassed.
If we don’t, then what was the point of having money in the first place? Frugality is good, too much frugality is bad. Now that I’m on year six of the FIRE journey, I recognize just how important spending money can be. Doing social activities like going out of town and attending weddings is money well spent in my book.
What is the Frugality Disease?
Frugality disease is an obsessive compulsive personality disorder (OCPD) in which the person tries to save money, at all costs. Even at the expense of their health, mental sanity, and the like. To them, saving money is more important than the value they get from spending money.
It’s no secret that price is what you pay, value is what you get. However, the ones who have the frugality disease don’t even care about the value they receive in return. All the care about is the price that they pay! What! They don’t care about the food they get in return to avoid starvation.
They care about the dollars going out of their bank accounts. Many people who join the financial independence, retire early movement suffer from this disease. They are too focused on trying to declare financial independence that they even skimp out on life essentials such as insurance.
They figure, well if I’m not going to drive that much anyway, what’s the point of carrying insurance? There are expenses that you can easily cut out like eating out too much at expensive restaurants that saves an extra $100 per week. However, there are essential expenses that you HAVE to spend on and can’t skimp out on.
I’m all for frugality and for saving money. I’m NOT for cheap and being too frugal. There is such a thing. Saving money, is generally a good thing. However, saving pennies but spending dollars later down the road isn’t a good option to take. It’s a dangerous path.
7 Signs of Frugality Disease
Below are the 7 tell-tale signs of being too frugal.
1) Frugality Disease Means You Skimp Out on the Essentials
There are people out there who actually refuse to buy insurance because they haven’t used insurance in the past five years. They think the worst case scenarios can’t happen. I recently got into a car accident in May 2022. The person ran a stop sign on her way to work. I never planned or expected the accident to happen.
However, the accident happened anyway. It’s unexpected events such as these that will happen in your life, no matter how much you don’t want it to. Insurance is an essential line items for everyday living. Otherwise, you are literally rolling the dice with your life. That’s the frugality disease.
For what? To save $1,000 per year? Is that really worth the hassle of it potentially causing you financial ruin? It’s not. The essential items are essential items for a reason. You really don’t want to skimp out on any of them. When I was a college student, I didn’t have health insurance because I couldn’t afford it. It didn’t feel so good.
2) You Focus on the Price, Not the Value
Whether we like it or not, we HAVE to spend money in our lives. There are none of us in this world who went through life without spending money. With spending money comes two things. You give up money in exchange for something else. People who suffer from the frugality disease focus on the money they give up.
They don’t focus on the value they receive in return. Whether we like it or not, we have to spend money on gas, car, and phones. In the caveman times, those expenses weren’t necessary. However, in the modern world, those expenses became a necessity. We don’t need a phone in order to be alive.
However, we need a phone in our lives for other purposes. When it makes that much of an impact to your life, it’s a good idea to not skimp out on them. I paid good money for my iPhone 10 that I have. I will be upgrading my phone in the next 2 – 3 years. A good phone is something that I can’t live without.
No frugality disease in my household.
3) You Don’t go to the Doctors
I get it. In the United States, people are more afraid to go to the doctors than anywhere else. The healthcare costs in the country are enormously and too expensive for anyone to afford, except the ultra wealthy. I actually knew a boyfriend of a coworker who refused to go to the hospital even though he needed to.
He needed to remove his appendix. He was so afraid of the bill that he would rather suffer rather than get the treatment that he needs. Yes, when he got out of the hospital they slapped him with a $100,000 bill. However, had he not gone through with the procedure, he likely wouldn’t have lived.
He negotiated the bill to zero afterwards.
It was very uncertain times. However, dealing with that uncertain time is better than potentially having long term health complications later down the road. He was not going to live a healthy life if he had made the problem linger on for more years. Thank goodness he got the care he needed.
Not going to the doctors is a sign of the frugality disease.
4) There’s No Room for Fun in the Budget
Fun isn’t a, “maybe I’ll get around to it” expense. Fun is a necessary expense. You HAVE to have fun in your life otherwise you don’t function properly. People who skimp out on this expense suffers from the frugality disease. We need to watch a good TV show or a good movie, or whatever our hobbies might be.
For me, I really enjoy trying out new restaurants around the city. The other day, I tried an all you can eat Korean BBQ. Yum. Although I thought it was too expensive, it was a good trip and I figured out good restaurant places around the city. Whether we want to our not, we have to relax and enjoy ourselves in the long run.
There are free activities to enjoy, as well. Simple things like going to the park or biking around town is a good activity to get the heart rate up and enjoy the outdoors. However, there’s nothing wrong with spending money for fun in the budget if it is worth it. The frugality disease allows for no such fun, which isn’t good.
5) Saving Pennies Feels Joyful
I get it. You have a credit card that gives you a 2% cash back on all purchases. So when you spend $10, you feel joy from getting back the 20 cents. It makes you feel like you won against the retailer. It makes you feel joy. However, think about it in big picture terms. Is 20 cents really going to matter in the long run?
Not really. Heck, 20 cents doesn’t even matter to your life today. It’s really just a rounding error. Sure, it can add up. But the most it’ll add up to is a couple thousand dollars over a year, IF that. Frugality disease is when you feel joy from saving 20 cents instead of feeling enormous joy from increasing income by $10,000.
Your time is worth so much more than saving a few pennies here and there. In fact, for a lot of people’s wages, it probably costs more to figure out how to save those 20 cents than the gain they get from saving those 20 cents. It’s just not worth it. Your time is worth significantly more.
6) Outdated Technology
Frugality disease is when you keep technology because it perfectly runs rather than look for the most optimal solution. I used to have a very outdated iPhone 5s until 2021. I had that phone for about 7 years. That’s a ridiculously long time to have it!
When I switched over my phone to the 10s is when I saw just how much I was missing out. The speed with which apps open, websites load, and the like is night and day. The time that I save from the faster processing power is well worth the $300 that I paid for the phone. I don’t think I will ever sell that phone for the next 2 years, either.
The frugality disease is when the bare minimum solution works instead of looking for the most optimal solution. The most optimal solution is out there. It isn’t necessarily the most expensive option either. $300 over the lifetime use of my phone is going to be something like $10/month, if that.
7) There’s Too Much Money in the Savings Account
Everyone knows that saving money is a good thing to do to build wealth. However, with inflation at 8.5% as of March 2022, saving money just isn’t the way to go anymore. You HAVE to invest the money. However, frugality disease will force people who suffer from this disorder to save and hoard as much cash as they possibly can.
It’s just not the right path way forward. Investing is the reason so many people are wealthy today, not saving money. They’re so afraid to take risks that they let the money erode in value to inflation. Year after year, without fail. Investing is a risky venture but not investing is an even riskier venture.
Even at the onslaught of the 2022 bear market, I still consistently invested my money into the S&P 500 through my 401k’s and Roth IRAs. It hurt. The downturns stung like nothing I’ve ever experienced before. However, I know that the long term, I will be just fine.
Frugality Disease Has to be Cured
Saving too much money is a recipe of living a wealthy yet unproductive life. Yes, if you save so much money, you will build wealth. Even though it will be at a slower pace than if you invested the money, it’ll still be a way to build wealth. However, frugality disease does so at the expense of your happiness and sanity.
It’s just not worth it to save an extra $1 if it takes five hours of mental power to achieve it. Especially in times such as these where automation exists. It’s a mental disorder. Whether we want to admit it to ourselves or not. It has to be cured because it will ostracize people from society if not. Social activities are a good thing.
There’s nothing wrong with going to a $100 concert every year or every six months or so with friends. We live to enjoy our lives, not to hoard as much money as possible. Additionally, at a certain point, earning an extra $5,000 per year is easier than saving an extra $500 per year.
Frugality disease lowers the quality of life than it increases it. There’s a show about extreme cheapskates. In the show, there are some millionaires who literally served her husband cat food. What! A multimillionaire is serving up cat food to a human being. That just doesn’t sound right.
Frugality is good but extreme frugality warps your sense of mind and reality. At a certain point, you can spend money in order to have fun. Not worry about the future but care about taking care of your present life. Then the quality of your life goes up, which should be everyone’s goal.
7 Signs of Frugality Disease Shortlist:
- Frugality disease means you skimp out on the essentials
- You focus on the price, not the value
- You don’t go to the doctors
- There’s no room for fun in the budget
- Saving pennies feels joyful
- Outdated technology
- There’s too much money in the savings account
