Living Frugally vs. Spending on What Matters: How I Achieve a Happy Medium

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Frugality isn’t about being “cheap” — it is about investing in what is important to you and living cheaply in the other areas that you don’t care about. It is about being smart and understanding where you can cut corners and save money.

The truth is, you can live frugally in ANY stage of life with ANY income level!

The reason I say this is because I live it. I consider myself “frugal,” but I am also an “onion” with frugal layers on non-frugal layers. Depending not the layer, I may be willing or unwilling to spend depending on how much that aspect of my life means to me.

Related: I’m a Successful Investor Because I DON’T Seek Perfection: Here’s Why

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Splurge “Layers”

  • I have a horrendous Starbucks habit. Guess what? I LOVE Starbucks. It’s my “weakness,” and the best way to make a bad day get better fast. So I am a “frequent flyer” at this institution to the point where the barista knows my order AND name. I have tried to make my own, but no one can beat a Starbucks Chai Tea Latte. So we all laughingly say, see you tomorrow!
  • I love my 2-year-old Toyota Highlander. I have a new car, and I love it! It doesn’t break down, and I feel safe because mechanics aren’t my strong suit. I have a husband who is gone more than home, and I live far from family with friends who have children that I like to visit. So I am happy that I am self-reliant, knowing my car won’t break — AND I love traveling, so yes, I do put miles on the car.
  • I indulge in travel. I love to travel, and staying touch is really important to me since being active duty, we live all over. Over Christmas I did a “Four California City” adventure in two weeks. I have taken three international trips trips since October, AND I have taken three domestic trips since Thanksgiving.
  • I have personal property in the works. We’re currently in the process of buying a 3-bedroom home with an office, a 3-car garage and an amazing pool in the one of the BEST neighborhoods in the town.

After reading my splurges, you can see that my husband and I enjoy life; that at 27 years old, my husband and I are LIVING life up! Would you guess that we own 5 houses, with another 2 planned by June 2015? That during our 5 years of marriage, I have only worked a “professional full time position” for less than half of the time?

Now let’s reevaluate those “splurges.”

Frugal “Layers”

  • I have a horrendous Starbucks habit. This is my “habit.” I am not a huge drinker, I eat my lunches at home and I signed up for the “frequent flyer” program. That all aside, there’s no excuse. It’s my human fallibility.
  • I love my 2-year-old Toyota Highlander. My husband and I are NOT mechanically inclined. We also are “new car” people — and we keep them for life. We have jobs where having a car breaking down would damage our careers. So we consider this an investment and acknowledgment to the fact that we aren’t perfect, and while there is room to cut money here, we also drive cars to the ground.
  • I indulge in travel. I love to travel, but I do it really cheaply. I give up my seat whenever possible (made $600 towards my next domestic flight over Thanksgiving). We have a Hilton credit card that allows us to earn status AND points. Therefore, we are to get free hotel nights, breakfast, internet (key for a self-managing landlord) and oftentimes drinks and snacks. We also combine works trips (thank you, this year’s international flights) with personal. This allows us to only have to pay for my flights since my husband is already there.
  • I have personal property in the works. Yes, we are in the process of buying a “nice” personal property. If successful, it is 20% undervalue because we are going through the red tape of a short sale. Instead of living in a nice house for the year my husband was deployed, I lived in a hovel, basically a storage unit with a kitchen and bathrooms. It allowed me to save the downpayment for the house. At the same time, we rented out our previous personal property. So basically, we got our newest personal property for “free” when looking at the downpayment impact. While the rental is $300 higher than our last house, along with high utilities, our previous smart rentals, along with taking career-advancing positions, more than makes up for the cost. It even puts us ahead.

This is only skimming the ice. The point is: choose your battles!

  • Go after the easy money. I am buy no means a “couponer,” nor do I exploit every good deal out there. As a working woman building a real estate empire, managing a flourishing website/blog while trying to be a good wife, I don’t have time. Instead, I go after the easy things that make the biggest different to my lifestyle.
    • Signing up for rewards programs. I sign up for all the easy programs, from Starbucks to Hilton. While I certainly am not perfect, this has allowed me to reduce.
    • Sweat equity. There are all kinds of sweat equity you can put in. While we love fixing up homes, I am not the best “power tool girl.” So I focussed on red tape, such as short sales, where I can get the most bang out of my efforts.
  • Spending money to make money. When we were first married, we made it a priority for me to get my Masters degree (part of the non-earning time described above), and for us, that has paid off in spades!
  • Taking advantage of the “lemons,” and making them into “lemonade.” A sucky deployment became a way to save money to purchase my “splurge.” Living across the country became an excuse to travel to explore the surrounding areas, etc.

Related: An Easy, Slow, Low-Risk, & High-Reward Way to Buy Your First Investment Property

While I could keep going forever, the point is: think outside the box! Don’t deprive yourself because you only live once. The point is to know when it is time to splurge and when it is time to buckle down. There have been points in our life when we have had to focus on our goals (obtaining my Masters in 13 months) and other times where we have let our hair down to play.

That being said, we still own 5 houses at 26 years old, and we’re on track for 7 by 27! So playing can’t be all that bad, right?

So what are your splurges, what do you stay frugal with, and where do you hope that your “balance” will take you?

Leave your comments below!

About Author

Elizabeth Colegrove

Elizabeth Colegrove is a passionate "buy and hold" investor who specializes in turning her once-negative transient lifestyle (Military) into a positive lifestyle. She self manages her entire real estate portfolio from long distance while holding down a full time job. When she isn't finding new real estate deals, she enjoys traveling, hanging out with her awesome boat-building husband, playing with her mischievous kitty, or writing on her newest project, her blog.


  1. Amanda Cook

    Great post Elizabeth! I connect 100% with your thoughts. We live in Spain and are both teachers, and we have 3 kids. We don’t go out to eat, our kids share all their toys, we wear out our clothes and shoes before purchssing more, drive a 20 year old car, but we splurge on traveling to the USA in summer and other parts of Europe.

  2. Michael Begley

    We have begun splurging on the quality of the food we are purchasing. It is easily offset by our eating out less, and learning to enjoy our time together during meal preparation.
    We have six rentals, owning two outright and using all the cashflow to pay off number three. Snowballing our cashflow, we hope to have all six paid off by 2021, then they will be our ATM machines.
    While we know the benefits of smart leveraging, our local market has gone ballistic, so it is easier to pay down the mortgages than to find another deal. We have our eye on a duplex, but doubt we’ll get it.
    Thanks for a thought-provoking article.

  3. Amy A.

    I don’t know if it should be considered a “splurge”, but we pay private school tuition for our kids. When they were younger, all three were in private school. The personal attention without distractions by those with behavior problems was worth it. When the school closed a few years ago, they all went to public school. It’s been an incredible struggle. I am trying to fix the problems rather than just complain, even going so far as to be elected to the school board. However, the politics and personal agendas are very entrenched. I finally had to pull my youngest kid out of public school. Private school tuition easily eats up several down payments on investment properties. This is an expense that many don’t consider when having kids. I don’t see our educational system getting any better in the near future.

    • Deanna Opgenort

      My parents sacrificed to send us to private schools at different points of our childhood, and it was probably one of the best things they could have done for us (other than instilling a love of reading).
      My brother and I have both ended up a career that we love that wouldn’t have been possible without the things we learned in school. Quite frankly, at least in California, the public schools are NOT turning out graduates who can speak, read or problem solve well enough to survive in the world market.

  4. john horner

    I like it! I am about 2 months away from quitting the day job, which is 6 months after my wife went part time as a nurse, so I am definitely in frugal mode right now. One of our cars is 11 years old and the other is 8 years old. My biggest reason to be frugal is that I will probably have to pay cash for my next few rentals once I quit the day job. With my wife part time and me self-employed it will be near impossible to get a rental financed. We do splurge on entertainment and trips we want to take. I am 30 and my wife is 29 and we have realized we get so much more satisfaction from experiences, especially with 2 little kids, then we do buying material things.

    I am of the abundance mindset, I would rather work my butt off and have everything I want then to lower my goals and try to spend less.

    Keep it up, 7 by 27 is impressive!

  5. Joe Woodington

    Great post! I’m 28 and own zero rentals so far so you’re way ahead of me. Hopefully that’ll change in the near term. My wife and I like to splurge on travel as well. We drive older cars and don’t eat out very often. Keep up the great work!

  6. Brandon Schlichter

    I think living frugally has alot to do with success in a business like real estate. You can’t cheap out, but you can certainly live within your means and save so that when major expenses come up you can avoid them mostly. I have done many BPOs on properties purchased by investors who caved in once rates got high or the market went down slightly. They had not saved for the ‘what ifs’ and lost dearly.

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