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Part One: Happiness...and Thrift
The word "thrifty" has a bad connotation. The choice word now is "frugal" because it conjures up images of someone who's wise and financially successful and above consumerism and all that. But when I hear someone is being "thrifty", it has a penny-pinching but-not-quite miserly ring to it. It's maybe one step up from "cheap". But it wasn't always this way. As Lyubomirsky notes, the term has its origins in the word "thrive" and thrift centers on the idea of optimizing the use of limited resources. Maybe thrift can be cool.
When we think of thrift as a means of efficiently using limited resources (like money or time), it seems more like a new idea, along the lines of sustainability or optimization. When we have only so much of a precious resource, eliminating waste is not only common sense, it's an imperative. Here is where the value of thrift gets beyond mere personal finance tips, and approaches the overall philosophy of efficiency that Mr. Money Mustache writes about. We all have a limited number of years on this earth, so pushing for an extremely early retirement is one approach to gain complete freedom of a maximum number of our years. Finding a career or calling is another way; but, no matter the approach it seems important to ensure you aren't wasting hours, days, weeks, and years. Along the same lines, most of us have a finite income for which we regularly trade a lot of our precious hours. If we're deciding to trade forty hours of time for money, then turning around two weeks later and wasting that money seems colossally stupid. If we're just going to spend all our "time-traded" money on meaningless trinkets or experiences that don't bring us happiness, we'd be better off not working for all those hours in the first place.
That's fine, but this analysis is all pretty high level at this point. What specific activities and approaches to our personal finances actually bring us more happiness? Skeptics will rightly question whether someone living frugally might be less happy, because of those choices, than a spendthrift. After all, there's a lot of information out there indicating there is a correlation between money and happiness; maybe the correlation is due to the spending. Readers of personal finance blogs are typically working to spend less, to sacrifice, and generally to say no to some of the things we are inclined to want. But one of the common criticisms of this sort of frugality is that is lessens our quality of life: we should learn to live a little. Is there any truth to this?
Luckily, Lyubomirsky has gathered the empirical evidence and has researched-based advice for us. Again, from The Myths of Happiness: "The outcome of our work together is the following proposal, which can be summarized thus: If individuals on meager budgets wish to extract the maximum happiness from spending less, they should bring to bear lessons from the ancient value of thrift."
So, there you have it. Thrift is fucking awesome. In the next handful of posts, we'll dig in to the specific advice Lyubomirsky prescribes.
Next up: "Don't be the borrower who becomes slave to the lender."