The New Frugality – Book Review

by Pam on November 18, 2011

The New Frugality: How To Consume Less, Save More, and Live Better by Chris Farrell

The New Frugality is an easy to follow personal finance book that is written specifically for Americans.   The author provides some real insight on what is happening today and he suggests that Americans are definitely changing their behaviors toward money. Rather than spending recklessly and borrowing more than they can afford to pay back, he believes Americans are getting back on the right track and becoming more financially responsible.  He calls this change “the New Frugality”.

Some insightful quotes in his book include:

“Personal finance is really about deciding how to live your life, figuring out what you really cherish and value, then putting your money behind those goals and beliefs.”

“Savings isn’t just money.  It’s a tool that’s critical for creating the kind of life we want to lead.”

“Frugality signals virtue bearing fruit through our savings, spending, and giving decisions.”

Tips About Homeownership

Some tips he suggests include being satisfied with a small home instead of insisting on a great big one.  Small homes make it easier to make a big down payment, you will pay less tax, and it’s better for the environment.  The author also provides a rent vs. own equation to help you figure out if housing is overpriced in your area.

Tips To Parents

Another tip Farrell suggests is to not make saving for your children’s education necessarily a separate priority; but instead, incorporate this in your overall savings plan.  There are so many demands on your money as you need retirement funds, emergency funds, etc.  Security for your family is important and as your children age, you can always draw from savings you have accumulated over time to help with education costs.

Money Management Tips

Farrell recommends having life insurance, disability insurance through work, saving for retirement, spending less than you earn, a down payment of at least 20%, getting a university or college degree, and always paying off your credit card balance in full each month.

Money Saving Tips

He recommends going green, as it’s less expensive and good for the environment.  He says to leave the heat turned down in winter and wear a warm sweater.  As any other frugal person would say, he recommends going for quality rather than quantity.  Use public transportation, energy efficient appliances, and don’t purchase prepared foods.  There are many other tips in this book; these are just a few listed to give you some ideas.  He also provides his opinions on various investment products and plans.

Why read this book?

If you are an American and you want to learn and understand more about the current economic situation and how to manage your money accordingly, then this is a good resource for you.  You may not end up reading the entire book from cover to cover, but by skimming through it, you are sure to find information that is insightful and helpful for your particular financial situation.

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