Today, many of us, especially Millennials and Gen Z, are caught in a consumerist lifestyle and do not practice frugal living. They often prioritize lifestyle choices over actual needs.
This mindset leads to unstable financial conditions and turmoil, as expenses exceed income.
Supporting this, data from the Financial Services Authority (OJK) in 2022 shows that the majority of online loan or funding users are between the ages of 19 and 34.
To break free from this consumerist mindset and lifestyle, we need to transition to frugal living. The concept of frugal living has sparked much debate regarding its pros and cons.
Do you know what frugal living means? Let’s explore it further.
What Is Frugal Living?
In simple terms, frugal living means adopting a lifestyle that focuses on saving more money. Many interpret frugal living as a form of self-denial due to reduced spending.
However, frugal living is often misunderstood as a life of hardship and self-punishment due to excessive budgeting. In reality, this is not the case.
According to Wealth Simple, frugal living is about being conscious of spending and focusing on financial priorities. This concept teaches us to make thoughtful decisions and analyses when allocating funds.
Good financial management and strategy are essential to achieving future financial goals. Frugal living helps us improve and balance the relationship between lifestyle and financial objectives.
Moreover, when further developed, the concept of frugal living also considers the sustainability of human life in the future.
Goals of a Frugal Living Lifestyle
- Meeting Long-Term Needs
Each of us has both short-term and long-term goals. Generally, long-term goals require more substantial funding.
Examples of long-term goals requiring significant funding include a dream wedding, children’s education, purchasing a home, or vacation plans.
You can achieve these goals more quickly by practicing frugal living. It teaches us to cut unnecessary expenses to allocate more funds for saving or investing. - Preparing for Retirement
One of the major funds we need to prepare now is for retirement. When we retire or reach a non-working age, we will stop working and lose our primary income source.
To maintain a comfortable lifestyle and avoid relying on others, you need to set aside funds to replace your primary income.
Adopting frugal living now can help you prepare for retirement more easily. You will value money more and focus on future needs. - Improving Family Finances
Not everyone comes from a financially secure background. Some families may have faced challenges that have shaken their financial stability.
Practicing frugal living can help reduce or even improve a family’s financial situation.
With frugal living, you can save by finding cheaper alternatives with better quality, which can be used long-term. - Achieving Financial Freedom in the Future
Financial freedom is the ability to live as you wish without worrying about financial problems.
To achieve financial freedom, you need substantial income, savings, or investments. One way to do this is by adopting frugal living.
Early budgeting will provide many benefits in the future. Funds usually spent on momentary desires can be used to increase savings or investments for greater returns. - Protecting the Earth and Environment
The growing global population is not matched by an increase in natural resources. In fact, natural resources are depleting as the human population grows.
The concept of frugal living has gained traction due to rising awareness of climate change and sustainable living.
Therefore, frugal living includes conserving natural resources, reducing plastic consumption, and recycling.
Through these practices, frugal living indirectly teaches us to protect the Earth and preserve the environment.
From the above explanation, we understand that frugal living does not mean depriving oneself or excessively cutting expenses.
The concept and goals of frugal living are profound and have far-reaching impacts beyond just personal benefit. One way to start frugal living is by investing in digital gold through Treasury’s Green Gold feature.
Not only does this help maintain asset value and yield investment returns, but it also contributes to reducing carbon emissions from gold production.
So, are you ready to adopt a frugal living lifestyle for a better financial and environmental future? Start now!
