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How to Live Below Your Means and Be Happy

Robie writes to help people acquire financial strength. She got her MBA from the University of Venice, Italy.

Tips on how to save and live happily on a tight budget—based on my personal experience. Understanding needs vs. wants.

Tips on how to save and live happily on a tight budget—based on my personal experience. Understanding needs vs. wants.

Living Below Your Means: What Does It Mean?

The ability to live within your means is a great asset in any financial situation. It becomes a true need during a financial crisis, like the planetary job loss due to the 2020 COVID-19 pandemic.

Many people struggle to make ends meet on a regular basis, and that's the focus of this article.

However, the advice can be applied to emergency situations.

Often, the family income could be enough to live in a more relaxed way, but it does take some effort and consistency to live below your means, adjusting your spending habits to be less than the money you bring in.

How do you do that?

Being Frugal When You Like Good Stuff

Maybe you are already good with money, always looking for good bargains, and you hate to waste resources.

In short, you do your best to get the most out of every dollar spent; you are frugal.

However, being frugal does not necessarily have to mean buying only at thrift stores, yard sales, and low-quality groceries.

When it comes to food, drinks, medicines, vitamins, lotions, or anything that would end up in your family's bloodstream, be very suspicious of cheap products.

Stick with the best/good quality items, trying to find them on sale; avoid the cheapest products, especially if you don't like what's on the label. I totally believe that we are what we eat.

That reflects my approach to spending. Below, I share some examples of my experience in handling finances.

In our family, the rule of thumb is: "If we can't afford it, we don't get it."

“How much can I spend?”

Knowing how much you can spend requires sitting down and crunching some numbers together. If you need guidance on how to do your own budget, you can find plenty of personal budget articles that tell you how. I've written a few myself.

Once you know how much money you have available, make a plan to spend less than that.

One Family, One Financial Plan

It’s extremely important to agree with your partner on how to handle family finances and money.

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Read More From Toughnickel

Different opinions on what is necessary and what is frivolous can lead to escalating problems and arguments, especially when money is short.

You need to work as a team and be on the same page.

Here is an article to learn more about family budgeting.

Got a Raise? Don't Increase Your Expenses

My husband and I come from families that have lived through the hard times of World War II and have built their own homes slowly, saving up a little bit at the time, buying things only when they had the cash to do it.

Because of that common background, we fully agree on the main choices of how to handle our finances. After we got married, we rented for one year, and then we decided we wanted to pay for our own place, and we bought a house, starting a 30-year mortgage.

We both agreed that the mortgage would be the only debt that we would ever have, and so we made choices to make that happen—at least until the kids go to college! When I say we have no other debts than our mortgage, I really mean it: we have bills but no other monthly payment that includes interests.

How Did We Stay “Debt Free”?

When we got pay raises, we maintained the same lifestyle as before. That’s the only way to set aside some savings. If you increase your monthly expenses every time your income increases, there will never be money for special purchases or emergencies.

Buying a Car Only When You Really Need It

When we needed a car, it had to be a used one, valued whatever we had in the savings account at that time. In the 18 years we’ve been married we have been driving four different cars, but never paid a penny in loan interests.

Car dealers don’t really like that, they want your money, and they love to get you to sign up for a loan with them.

Three of the cars were used ones, purchased from privates. One was brand new, a 2002 Honda Accord, which we are still driving, and we chose it for the reliability, the great gas efficiency, and because we could afford it with our savings.

Avoid Bank Fees or Credit Card Interest

I’m very proud to say that in many years of using credit cards practically for everything we buy, neither one of us has ever paid one penny in credit card interest. That’s huge savings right there.

We use our credit cards for everything, but we know we can spend only as much as we can pay off the next month. I realize this takes some self-discipline.

Some people suggest controlling your budget by taking out the cash you can spend each week. I respect that opinion, but it’s not my style. I can self-regulate my credit card purchases not to go over a certain amount. I don’t like to use debit cards and checks much because if we both spend from the same checking account it becomes difficult to properly keep track of the balance, and we'd likely overdraft it.

When we need cash, we go to our bank’s ATM, to avoid foreign ATM’s fees. Sometimes I pay with my debit card at a store so that I can get cash back.

Using credit cards is a great thing, as long as you do it responsibly. That means paying off the balance every month.

Using credit cards is a great thing, as long as you do it responsibly. That means paying off the balance every month.

Saving Money on Food

We all need to eat every single day, several times a day, so clearly, food has a huge influence on our family budget.

You can save quite a bit of money using coupons. Be careful not to fall into the trap of buying things you don't really need just because of the discount.

If available, use your supermarket’s fidelity card, or loyalty program. Not only it makes you eligible for the weekly store savings, but also it gets you discounts on gas at the affiliated gas stations, and when you purchase gas.

I love that program, it really works for our family. We usually save around $600/year just using our store card, without any other coupons.

Eating at home is way cheaper than eating out. Make a meal plan, but the groceries you need and enjoy the home-made food and the savings.

Food has a big influence on family budgets. Packing lunch saves money and can be healthier.

Food has a big influence on family budgets. Packing lunch saves money and can be healthier.

Packing Lunch Saves Money and It's Healthier

Pack lunch to work. Packing lunch is not only a great way to save money, it’s also extremely healthy. Leftovers are a great resource for packing lunches. I usually cook extra portions on purpose, refrigerate them in my super-useful plastic containers, and I’m all set for me and my husband's lunches.

I pack the kids’ lunches too, even if I have to admit, school lunches are pretty affordable, but my kids end up always getting the pizza, so I prefer to prepare for them something they like and varies their diet.

Don't waste food. After you paid for it, and you spent money and energy to cook and fix meals, any clean leftover should go into a plastic container, in the refrigerator or freezer to be enjoyed on another day.

Note: It is important, for safety reasons to refrigerate leftovers pretty quickly, when they are still warm, to avoid bacteria growing.

Be a Frugal Coffee Lover

Being frugal is great, but for some things, I don’t compromise. Quality and taste of what I buy must be good. One example is coffee.

We are coffee lovers, and can’t get started in the morning without our cup o’ Joe. And we kind of need one after lunch too; it’s our midday energy booster.

We buy the best coffee blends of our choice, no cutting corners there to get the cheaper ones. Only in special cases, we buy fancy coffee, barista style, like on trips.

My husband used to buy expensive take-out coffees during the work days, until he bought a good coffee maker, at a great price, that makes excellent coffee; now he keeps it in his office.

In only two weeks, he paid off the coffee machine by making his own cappuccino, saving money and also time, since he does not have to go to the cafeteria anymore.

Making your own coffee can let you save $800 a year.

Making your own coffee can let you save $800 a year.

Save on Clothes

In Europe, sales are very seldom and short, that's what I was used to. When I moved to the USA, I found the US malls being super-stimulating for my shopping-lover self, because there are clearance racks on any given day.

It can be tricky to get out without buying anything, but I’m learning to control the urge to get the deal of the day—it might be a sign I’m getting old, lol! However, when I do need clothes, I only buy what is on sale.

I signed up for email notifications from my favorite stores, and they let me know when major sales are going on. Often, the email has a printable coupon as well.

I’m not big on buying used clothes, that were wore by strangers, and smell like somebody's shed. However, I love hand-me-downs. I raised my children on clothes outgrown by friends' children.

Save Money on Movies

Like going to the movies? Me too!

Check out if there are movie theaters in your area that show movies for $2-$3. The films on view may not be new releases, but they are new to you.

You can cut on budget expenses by canceling cable subscription and getting Netflix, Amazon, or similar service. There might be some adjustment needed, you lose access to cable channels, but those streaming services have a lot to offer, and you can watch on smart TVs, computers, tablets, and phones.

How to Save on Books

Reading a book is a pleasure and a way to grow as a person.

Some people can't resist the urge to own a book they love. However, since books are expensive, borrowing from the library is a great option.

If you really prefer to own, in that case, try to buy new releases on sale.

For older books you may find them in good conditions and a great price at used bookstores or online.

Of course digital versions of the books can always be an option and they are cheaper than the paper version. You can also download free ebooks from your library.

Ebooks can always be a cheaper option than the paper version and they can bee dowloaded for free from your library.

Ebooks can always be a cheaper option than the paper version and they can bee dowloaded for free from your library.

How We Save on Greetings Cards

Whenever we need cards for children’s birthdays, I ask my kids to make one using construction paper, stickers, markers, and other things that I have around the house. The money we save on the card can be spent toward the gift.

Besides the money aspect, I consider this a great learning moment for my kids, plus it makes a cute personalized card for the recipient.

When we need cards for adults, sometimes I do buy them, mainly because I run out of time to make my own. But if I can manage, I make a greeting card using a small original painting of mine. If that does not work out, or look in the $.99 section at the store, there are some cute cards that can definitely compete with the fancy ones.

For me, it's not really to save money, because I usually end up spending more on the gift, however, it could be. For us it's more about spending money wisely, I rather invest $3-4 more in the gift value than on the card.

Happy Saving!

These are just some of the ways you can adjust your lifestyle and still get some good stuff but make it a little easier on your wallet.

This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.

Questions & Answers

Question: My husband insists on buying a new car, even though his car is working just fine. I'm more in line with what you say in your article, and trying to live below our means. Do you have any suggestions on how I could convince him to wait?

Answer: When in doubt, I always like to give the power to the numbers.

I recommend you do some homework before you sit down and talk to your husband.

How much would the car cost? Would you pay using your savings or get a loan?

Write down a few scenarios showing the money you can spend or save if you buy the car now and if you wait 3-5 years.

Savings left in the bank earn a little interest and provide invaluable peace of mind.

A loan involves monthly payments and charges interests, increasing the actual cost.

What else could you do with that money?

Talk to your husband with your notes in front of you to support your point, and together compare the different scenarios.

Maybe it's worth to wait and use the money for something else, or maybe you decide to wait to be able to afford a better car in a few years.

It could be that you decide to go ahead and make the purchase now, it's all good as long as you both agree on the plan.

Good luck finding a nice compromise that makes both happy.

© 2012 Robie Benve


Robie Benve (author) from Ohio on August 31, 2020:

Thanks a lot Tammy! I see from your articles that you are also a fan of savings and financial health, how awesome. :)

Tammy Winters from Oregon on August 30, 2020:

great tips on saving money.

Robie Benve (author) from Ohio on July 22, 2020:

Thanks a lot Abby, I wrote the article in the hope that someone will find some of those saving tips helpful and get some peace of mind because of it. :)

Abby Slutsky from America on July 22, 2020:

You offer lots of great money saving tips.

Robie Benve (author) from Ohio on September 26, 2019:

Hi ricroc, with "fidelity card" I mean a store loyalty card. Thanks for pointing out how the term can be confusing, I'll edit the text. :)

quotes for teachers day on August 29, 2019:

Sorry but many things are not compelling!

Robie Benve (author) from Ohio on August 20, 2019:

I totally agree erinshelby! I pack lunches and snacks every day for when we are out, and it's amazing how much cheaper it is to eat healthy. Plus I use reusable containers, cutting down on the plastic waste.

erinshelby from United States on August 16, 2019:

I couldn't agree more about packing lunch & making your own coffee! It's amazing how quickly these two items can add up on the budget... even when you make your own. How much more would they be if you were eating out? SO much more that it's not worth it to make it a habit of eating out daily...

Pinaki Goswami on April 24, 2019:

Nice and valuable tips. I will definitely follow these tips for saving my hard earned money. Thanks and regards. Please visit my blog.

Robie Benve (author) from Ohio on April 02, 2019:

Hi Kay, I loooove free stuff and bargains. :) Thanks for sharing the info.

Kay Reds on April 02, 2019:

Nice ideas especially making the cards uptown they can be $5. 3000freegoodies has a lot of freebies + free gift cards. I like free if it can be found.

Robie Benve (author) from Ohio on January 07, 2019:

Hi Polyanna, thanks a lot for your insightful feedback, It sounds like you guys are doing a wonderful job reducing expenses while keeping up a good quality of life. Way to go!! Best wishes for much happiness and financial serenity.

Pollyanna Jones from United Kingdom on January 04, 2019:

This is great advice. We over-did it and are paying the price. Having learned our lesson, we've pulled in our belts and are living below our means so that we can improve our finances. Taking our own lunches to work is a great way to save, as is the importance of self-discipline! I got myself a little cafetiere and use that at work now so I can have good quality coffee without paying the extortionate price of a take out. I also pick up a lot of books second hand - often I find ex-library books on Amazon for under $1. Buying pre-used items not only helps you save money, but it reduces waste to landfill. So it's a great way of helping minimise our impact on the environment too!

80l808l08 kim on October 04, 2018:

Everyone should check out how to live below your means it's excellent advice..

Robie Benve (author) from Ohio on September 24, 2018:

Hi Nicole, it sounds like we could be shopping and coffee buddies, lol. Great to hear about your experience! Thanks a lot for sharing and for the supportive feedback.

Nicole K on September 20, 2018:

My husband and I love thrift stores, but I do like to wash the clothes I get from there first, before wearing them! It's amazing what great deals you can find on items that were hardly used. I agree with you also about not skimping on coffee. We love buying good coffee from Trader Joe's and my grandpa makes fun of us for not just drinking Folgers. That's just not our style! I love to shop also but I'm really trying to be more content with staying home and enjoying what we already have. It can definitely be challenging, but it's worth it! Thanks for your insightful hub!

Anna R. on August 27, 2018:

It's so hard to not adjust your spending when you get a raise! When it happened to us, we were always so relieved that we could finally afford something, that we end up spending all the extra money, all the time. Thanks a lot for all the great tips! Lots to think about.

Kyokusiima Diana from Kampala-Uganda on August 06, 2018:

quite educating. thank you.

Robie Benve (author) from Ohio on June 14, 2018:

I agree, Christine, well-meaning friends sometimes put a lot of pressure on us about conforming to what they feel like is the minimum standard. lol I actually found it very liberating when I moved to the USA from Italy. Everything aspect of your life can be very fashionable in Italy. Here I can wear a top that is 5-years old or have ever-green style furniture from a generic store, and still get a lot of compliments. Thanks a lot for your comment!

Christine Mulberry on June 12, 2018:

Great information and to me, a smart lifestyle. I'm 60 years old and am very financially comfortable thanks mostly to this attitude. Over the years I found it's also important to be able to ignore much of what society said I HAD to have. Even well meaning friends can bombard you with pressure to spend more. "oh, you can't use that phone, you must have the iPhone X". Even to the point of constant disappointment in the fact that I bought a brand new Mazda sedan vs. a $40,000+ crossover or SUV that they prefer. (even though, as a single now, I have no use for that). Keep it up, you will reach your financial goals and have what you need and what you want (not what everyone else wants).

Robie Benve (author) from Ohio on April 21, 2014:

Hi tenordj, I agree, you really can still enjoy life and live on a budget, though it may take some courage to change gears and get started. Thanks for your feedback. :)

Jason from Jamestown TN on April 18, 2014:

Thanks for sharing....we have very similar financial policies and when we first started we had reservations about it but wanted to get our financial house in order. You really can still enjoy life and live on a budget and these are great ways to get started.

Robie Benve (author) from Ohio on March 18, 2013:

Thanks Joym7, I try to be "reasonably frugal", and it works out well for me. I'm glad you agree with the necessity of living below your means. :)

Joy from United States on March 15, 2013:

great hub. everyone should apply these and must be frugal for better family wealth and health :)

Robie Benve (author) from Ohio on May 30, 2012:

@ athomeather, great to see I'm not the only one not using coupons. I know it's a great thing, but for the things I usually buy there almost never coupons, so I end up buying things that i don't really need because they are cheap, and they clutter my pantry and often expire on me. !!

PS: I found your comment marked as spam, sorry about that, it must have been a glitch in technology. Such a nice comment flagged as spam, it sure wasn't me.

Thanks. :)

Robie Benve (author) from Ohio on May 30, 2012:

breath2travel,thank you so much for this fantastic review of my hub, and for all the support, sharing etc.

You are doing a great thing ensuring that your children get a good understanding of money issues. Way to go!

Ciao! :)

Heidi from Gulf Coast, USA on May 30, 2012:

GREAT hub! I, too, am not too comfortable with buying used/thrift store purchases. At one time I did - purchased a bunk bed set & mattresses -- and am still battling the carpet beetles that came with the set!

I buy new items on sale. If it's not good quality, I'm simply not interested. I've taught my kids how to shop smart - and that our dollar buys more than other people's dollars. ;)

I soooo agree with you on the coffee, too. Cheap coffee is DISGUSTING. Blech. Go for the organic - healthier and tastier.

My hubby and I are working on a financial plan for our home currently. We are coming out of a tough season as a self-employed family. We are going to teach our kids the Dave Ramsey finanical planning for teens as well, and send them through a formal course. We wish someone would have taught us at an early age many of the principles you describe in your hub. Thank you!

Voted up, useful & Interesting. I am sharing on my FB wall, and linking to my "Simple Ways to Save Money" hub.

Heather from PA on May 30, 2012:

wonderful read! if it has to due with living frugally i am for it! i enjoyed reading that you do no use coupons for products you do not usually buy. i found myself in a terrible way using coupons for things we did not even need and cluttering our house up for a bit!

Robie Benve (author) from Ohio on March 14, 2012:

Hi King, 5% cash back on purchases is great! I only get 1 or 2%... I may have to start reading those card offer that come in the mail. :)

You are right, paying off my credit card every month can build some excellent credit, if your other finances are in good standing.

Thanks for reading and taking the time to share your experience. :)

theking2020 on March 13, 2012:

Excellent article I used my credit cards only because I get 5% back on purchases, is either that or no money back using my bank account. I rather use the credit cards on that aspect. As soon as the bill comes pay it off, the credit remains good standing and I got to save some money, in top of that using coupons are extremely helpful.

Robie Benve (author) from Ohio on March 09, 2012:

Kthix10, thanks for the positive comment, I'm happy to hear you agree with my loan philosophy.

Good luck paying off that loan quickly, it's going to feel so good! :)

kthix10 from IL on March 09, 2012:

Great hub, I think you nailed it on the head with the mortgage debt, we have student loan & the mortgage. We are quickly trying to pay down the student loan before our kids get anywhere near the college age

Robie Benve (author) from Ohio on February 29, 2012:

Thank you Linda for taking the time to read and share you positive feedback. :)

Linda Chechar from Arizona on February 24, 2012:

Super Hub with solid advice for everyone. Valuable lessons for a financially secure life. Thanks!

Robie Benve (author) from Ohio on February 19, 2012:

Thank you donnaisabella, that's a wonderful compliment. I like to think of myself I'm a balanced person. And I'm glad you like my lifestyle. Blessings. :)

Isabella Mukanda from Fort Myers on February 18, 2012:

Great tips and views, I love your way of saving and living, they make sense to me. Thanks so much for sharing, you are a very balanced person.

Robie Benve (author) from Ohio on February 17, 2012:

Yay! I thought there would be a niche of people out there that can relate to my philosophies. Great to hear one of them it's you, Simone! :)


Simone Haruko Smith from San Francisco on February 17, 2012:

Robie Benve, you and I have nearly identical financial policies. What fun! I love how you've explained things. Hahaa, living BELOW one's means- that's a great way to put it... and a REALLY novel concept to most Americans, I imagine! Thanks for putting together the fabulous Hub.

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