Frugality and Retirement: How Does It Work?

Like simple living, frugality is a word that is really open to interpretation. There are folks who think of frugality as being a smart steward of their money. For the most part, wants are replaced by needs in the budget. A free movie from the library replaces the $10 ticket at the local cinema. Dinner out is either the $5 foot long sub at Subway or a home cooked meal instead of the $30 restaurant experience.

For others, the word takes on an almost religious tone. Spending more than is required to stay alive is to be avoided. Living space is cut to the bone. Almost all belongings are given away or sold, leaving a dresser drawer with a few changes of clothes. If possible, a car is replaced by public transportation or walking. Health insurance is dropped, in favor of self-medication and an occasional trip to the emergency room or free clinic.

This second interpretation is not what I think about when I type the word frugal.The dictionary defines frugal as not wasteful, not spending unnecessarily, being economical and thrifty. How many people would not find those words something to strive for?  The problem comes when each of us puts our own interpretation on those words. To somebody a 60″ LCD TV screen is a necessity. Buying a $60,000 car instead of the $75,000 version could be considered thrifty.

Frugality, like simplicity, is in the eyes of the beholder. Living on $100,00 before retirement and $70,000 after is certainly more frugal. But, for many of us the numbers may be more like $50,000 before retirement and $25,000 after. So, how does a satisfying retirement work when one has to be frugal?

There is no argument that it takes work and a commitment to the goal. It requires reassessing what you need to be happy and content. It demands that you prune those things that no longer fit within your budget. It pushes you to decide what are needs and what are wants.

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