17 Secrets to Frugal Living According to Dave Ramsey
As someone who aims to have a financial cushion, I’ve been looking for smart ways to save. When I started my financial journey, one of the first people I found online was Dave Ramsey.
For those who don’t know Dave Ramsey, he’s a renowned financial expert who promotes a debt-free lifestyle. He advocates for very specific strategies that can teach you to achieve financial stability.
He does have some very strong opinions, so while I don’t follow his advice actively anymore, I do think he has something to teach all of us. Here are some of Ramsey’s insights that can help you to start and create a worry-free financial life.
1. Do a Monthly Financial Review
Ramsey emphasizes the importance of reviewing your finances each month. This process involves examining all your bills and receipts to see where your money goes.
By doing this, you can identify areas where you can cut back and save extra cash. For example, when I did my own review, I realized I was dining out a lot and spending too much on snacks. After knowing this, I reduced my snack purchases and cut back on eating out. As a result, my credit card bill went down significantly.
2. Work Out at Home
I know there are many benefits to going to the gym. You can have a coach, access to more equipment, and motivation from seeing others work hard.
However, if you only go to the gym once a week, it might not be worth the monthly membership fee. Instead, exercise at home using online resources or free apps as your guide. You can start by investing in some basic equipment, like dumbbells and resistance bands.
3. Brew Coffee at Home
You don’t have to spend money on coffee at coffee shops. I know, having coffee at these places is convenient and has that “Instagram-worthy” appeal.
However, if you’re trying to save, Dave Ramsey suggests brewing your coffee at home. It’s a great way to live frugally and save some bucks.
4. Eat Meals at Home
There’s nothing wrong with wanting to eat out occasionally, but doing it too often isn’t good for your financial health.
That’s why it’s wise to follow Ramsey’s advice and cook meals at home. I know this might sound tiring, especially with the cooking and washing the dishes afterward. However, if you want to live frugally, this is one of the most effective ways to lower your expenses.
5. Secondhand Finds
You can find treasures in secondhand items — well, not gold, but valuable finds. I was shocked when I stumbled upon a Hermès bag at a thrift store for just around $60.
At first, I thought it was a good knockoff, but when I got home and cleaned it up, I found a code that revealed it was actually from the 2015 Kelly collection! Beyond bags, you can also find used clothing, furniture, and even electronics. All it takes is a little time and patience to discover these gems.
6. Sell Things You Don’t Need
Another tip from Dave Ramsey is to sell items you don’t need. I’ll admit, when I tried this, I spent nearly a day figuring out what to let go of as I get emotionally attached to my belongings.
However, we need to let go of certain items to move toward our goals. Start by identifying things you don’t use or need anymore and sell them for some extra cash. This helps you clear up your space and earn some additional money on the side.
7. Stay Away From Debt
Dave Ramsey stresses how important it is to stay away from debt for a solid financial life. If you have existing debts, try to eliminate them as soon as you can.
From my own experience, trying to save while carrying debt didn’t work out well for me. I ended up emptying my savings. So, I’ve learned to pay off all debts first before starting to save. However, I understand that everyone’s situation is different, so find what works best for you.
8. Have a No-Spend Day
For those who find themselves spending daily, Dave Ramsey recommends having a no-spend day. On no-spend days, you refrain from buying anything, even your favorite coffee or snacks.
When I tried this, I managed to save about $35 in just one day. I put that extra money into my savings account, which really helped boost my finances.
9. Practice the 24-Hour Rule
Whenever you feel the urge to make an impulsive purchase, wait 24 hours before deciding. This pause allows you to restrain yourself and think about your decision.
I experienced this when I really wanted a new Samsung phone. After 24 hours, I still wanted it, but the desire wasn’t as strong. This time gave me a chance to think rationally and realize my current phone was still working, so I didn’t really need a new one.
10. Discover Free Activities
We all need to have fun. However, it doesn’t need to be expensive. Dave Ramsey suggests finding enjoyment in free activities.
For example, you can go hiking, have a picnic at a local park, or enjoy a fun night at home with friends. I used to think fun meant shopping, dining out, and bar-hopping with friends. Unsurprisingly, my credit card bills reflected that lifestyle and were quite high. Since then, I’ve made it a point to live intentionally, especially when it comes to my finances.
11. Stop Impulsive Upgrades
The golden advice from Dave Ramsey to stop impulsive upgrades might seem tough to follow, especially for younger generations. We’re constantly bombarded with new items and trends on social media.
I completely understand if it feels challenging to resist keeping up with the latest fads — I’ve been there, too. However, Ramsey recommends upgrading only when needed. To be specific, you should only upgrade your phone when it breaks down. I am there now, and I don’t care what kind of gadget I have as long as it does the job, but it took me a while to get there.
12. Avoid Credit Cards
If you want to make sure that you don’t get tempted to get into debt and buy things you can’t afford, don’t use a credit card. If you have a credit card, Dave Ramsey believes it’s easier for you to get into debt, overspend, and sustain your poor financial habits.
Even with rewards and points, there’s a high risk of accumulating debt. With the current 20.7% interest rates on your credit card, this is not a balance that you want to carry. He goes for using cash, in the well-known cash envelope system, or use debit cards.
13. Get Bonuses and Discounts
No matter how small the savings, every little bit counts. That’s why you should maximize all the bonuses and discounts you can get.
As a shopper, I always try to make the most of any incentives available. Joining loyalty programs can be a great way to access discounts. For every dollar you spend, you can reduce the overall cost of your items. When shopping online, be sure to search for available coupons.
14. Make Money From Hobbies
Try to make money using your hobby. This can be your source of extra income, which helps boost your savings.
If you’re good at painting, you can sell those online. If you’re talented in baking, you can sell your baked goods online or to your friends and family.
15. Shop With a List
Ramsey advises shoppers to shop with a list. By doing so, you shop with the intention to buy only those things.
This prevents exceeding your budget and saves time. Assign a specific envelope for grocery money to spend only what you really need. I mean, I once walked into the supermarket for eggs and left with a new oven (and forgot the eggs). It’s safe to say my partner wasn’t too happy about that.
16. Cut Down on Unnecessary Home Decor
Home decor can make our homes more inviting and pleasant to look at. However, over-decorating your place can make your place messy and may cost you a lot. I have a lot of friends who buy decor for every single holiday, every season, and they keep getting more each year.
If you want to add new decor, consider the DIY method. If you want to have something, make it yourself. It’s a fun way to save money and personalize the decoration you want to add.
17. Make the Most of Unexpected Income Wisely
Whenever you receive unexpected money, Dave Ramsey suggests that you make the most of it. This doesn’t mean you should spend it on your wants, but rather treat it like regular income.
Use this money for debt repayments or put it into your savings account. This way, you can improve your current financial situation and build on your financial future.
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