A Penny Saved Is Worthless?


I had a conversation recently that just keeps coming back to me, so I guess I need to write about it to get it off my mind.  The conversation was about being frugal, and here are a few of the points that were made:

1.  Saving a buck here and a buck there makes absolutely no difference. 

2.  You either have it or you don’t, and scrimping won’t matter.

3.  Wealthy people got that way because they got a good break/inherited it/just happened to be in the right place at the right time.

Since I’ve always considered frugality and careful money management to be the lifeblood of financial freedom, I was appalled.  I honestly never knew that there were people who thought that spending carefully would never make a difference in your financial status.  It is amazing to me that anyone could believe that, and I am still sort of in shock.

I find it interesting that the person who made these statements is always complaining about not having money, always thinking that someone should share with them, etc. even though they make a more than comfortable income.

So I’m asking…what do you think?  Is it possible to become wealthy (or at least debt-free with a little savings set aside) simply by living more simply and spending carefully, or is it something that pretty much depends on luck?


My quote of the day, gleaned from Resolved2Worship’s site

We do not see things as they are, we see things as we are. 


edited to add:  Interesting.  Dollarish asked to feature this post.  Evidently it resonated with someone.  One more question, since most of my commenters seem to agree with me…

How do you convince someone that their financial behavior is self-destructive?  Is there any way?



About dayuntoday

I'm a wonderer. I spend a lot of time mulling, pondering, and cogitating. This is just a place to park some of those thoughts.
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22 Responses to A Penny Saved Is Worthless?

  1. @homefire – it is possible to becomewealthy (or at least debt-free with a little savings set aside) simplyby living more simply and spending carefully, yet it is something thatpretty much depends on [something outside of ourselves controlling the circumstances]?

  2. I would like to think it is still possible to gain monitary wealth through wise use of money and careful lifestyle.  However, it’s not material wealth that I concern myself with. 

  3. quilt_cats says:

    The people who don’t believe in being frugal have just given up- I know some of them and am amazed that they look at it the way they do.  They blow all their money on really silly things (like sports cars and trucks when they could have got something more frugal), and don’t have enough for the necessities or their electric bills or groceries…

  4. ElizabethDNB says:

    Read “Millionare Next Door” by Stanley and Dank.  Best book on this subject ever.  You are giht, who ever you were talking to is totally wrong, and I have zero tolerance for people with a sense of entitlement.  Although I am fine with helping people who really need it.

  5. mrcolorful says:

    if you live within your means and save money in some way then sure as hell will improve your financial well being.  How does anyone ever intend to retire if they don’t have savings somewhere?That said, there are people who view wealth and independence through the eyes of having lots of stuff and especially fancy stuff.  It kind of sounds like this person you were talking to holds to that definition in which case he is correct, you will never have tons of very fancy stuff if you live simply and responsibly.

  6. fwren says:

    We have inherited nothing, never seem to be in the right place at the right time and certainly are far from wealthy, but by learning the hard way, careful “scrimping” for a period of time and just some plain common sense, the Lord has taught us and blessed us with being debt-free for a long time. It is such a wonderful blessing. Of course, we are all wealthy compared to 90% of the world, I expect. Although we don’t have much worldly treasure, we have enough of what is important, and that is all we need. God is good.

  7. 1. Saving a buck here and a buck there ADDS UP!2. Depends on your point of view on who has and doesn’t, that’s why comparing is dangerous.3. These may be true, but some work very hard and are very generous.

  8. homefire says:

    @brother_barabbas – How can you have it both ways?  Either your behavior makes a difference or it doesn’t.  Yes, some people get rich by having it fall into their laps, so to speak, but my question was whether it’s possible without that?

  9. homefire says:

    @ElizabethDNB – Thanks for the book rec–I’ll check it out.  And yes, the entitlement mentality seriously upsets me.  They probably want the new healthcare plan, too, even though it will bankrupt us far worse than we already are as a nation, and very likely cost them more than the plan they’re already on…  Some people just don’t get it that you generally don’t get something for nothing.@mrcolorful – That’s an interesting twist.  I hadn’t really thought about it from that perspective–I suppose there are different perspectives on what wealth is.  To me, it’s being without debt and comfortable, but you are probably right that other people see it differently.

  10. @homefire – I can be as frugal, conscientious and thrifty as possible, which will no doubt have a positive impact on my available cash flow. Cash flow is good; rather, positive cash flow is imperative in the quest to become debt-free. However, I cannot (in my own strength or by my own cunning) prevent calamity from striking me or my family. Calamity has a way of turning the best intentions and plans into a pile of ashes at our feet. When a disaster strikes that costs our house and its contents, or a health emergency that turns into an extended situation, we find some things out of our control; things like, steady income (yet the expenses continue to come in at the same, or greater, rate).So I maintain, yes, it is possible to become wealthy (or at least debt-free with a little savings set aside) simply by living more simply and spending carefully, yet it is something that pretty much depends on [something outside of ourselves controlling the circumstances]?

  11. homefire says:

    @brother_barabbas – So you’re saying that your behavior does make a difference.  Obviously, everything in life can be affected by catastrophic circumstances out of our control, but that is a whole different subject. 

  12. It is ‘a whole different subject’, I agree; however, it may not be as unrelated as we think in today’s uncertain employment climate. I have been unemployed for 9 of the last 24 months. This has had an enormous effect on my quest to be debt-free. As previously stated, my thriftiness, conscientiousness and frugality cannot reverse the negative effect of unemployment. However, thriftiness, conscientiousness and frugality DOES have a positive effect on slowing any negative consequence associated with unemployment. What I’m saying is this, addressing our spending/savings habits alone is to only address 1/2 the story…..and currently being in the newspaper/media arena, I KNOW that 1/2 a story, 1/2 the data, 1/2 the facts is not a full report!

  13. fwren says:

    R ~ in response to your edit question ~ sometimes people like that just have to learn the hard way, sadly ~

  14. I agree with fwren, R, and know from experience that until a person is willing to adjust their standard of living/spending habits no amount of information or education will ever convince them of their self-destructive habits!

  15. medelamom says:

    I believe it’s totally possible. If you avoid debt in the first place, your income can work much harder for you. Instead of putting $300 a month into a car payment or paying on a credit card you could invest it. The problem for many people is that the payoff isn’t NOW. They don’t want to wait until they’ve saved enough to buy the car they want so they go get a car loan. And instead of saving for that big tv or stereo system or whatever, they whip out the plastic. Sure, $300 a month probably won’t make you a millionaire in a year, but you’ll retire very comfortably! I love Dave Ramsey and his Financial Peace University course. As far as ‘making’ someone see the error of their ways in a situation like this…well, more power to you! I think that’s probably harder than being frugal sometimes. Our country is so embroiled in materialism that it’s not seen as a vice, it’s just our way of life any more. And I agree with the book recommendation too. it’s a good one.

  16. Regarding the question from the edit:If ever you figure out how to help people see the error in their ways, please share!!  My husband and I have been married for 2.5 years.  In that time we have been able to go on some nice trips and acquire some nice things – all from working hard and saving.  I have a BS and with help from my parents, never had any student loans.  My husband just completed a 1 year massage therapy course, and we still have no loans.  We live in the house that I bought just over 4 years ago.  Many of our friends look at us and say ‘I want what you have’.  But every time I tell them some of the things that we do (frugal things) they never want to do those things.  Everyone definitely seems to be about instant gratification.I would love to be able to help those friends that ask for advice, but I am at a total loss how to actually get through to them!  They all seem to think we have the things we do because of our parents helping us out.  My parents did help pay for my college education.  My Dad did co-sign my mortgage, but has never paid a dime towards it or the house.  My husband’s parents did give him a nice lump sum when he graduated – which paid off my car.  So we have definitely had help, but we make smart financial choices everyday which keep us going in the right direction.  I dont know how to get people to see that part of it!

  17. tracezilla says:

    Itdefinitely is possible! Maybe you can’t become independently wealthy bydoing this alone, but you can at least be comfortable and out of debt.If you do it right.I have a feeling, from your description ofthe person who said this to you, that this is just their excuse not tofeel guilty (and to justify to others) their spending habits and thefact the consequence of them (not having any money). :/Lazy people, or spendthrifts, always find ways to justify their actions/habits to themselves and others.

  18. emeralds says:

    Myhusband and I have paid off about $45k in debt (2 new cars- both paidoff now, a small loan from my FIL, and part of my student loans) in 2years by scrimping/saving/snowballing.  Watching where our dollars gohas made all the difference- we have a monthly budget and it reallymakes you think about your purchases.  Yes, we don’t have tons ofstuff, but we live comfortably and money doesn’t stress us out.  I’meven going to be able to be a SAHM because of our scrimping the pastfew years.  I have a friend whose husband says they’ll always bein credit card debt, so what’s the point of trying to pay it offquickly or pay more than the minimum and the just keep charging more stuff so their balance never goes down…it hurts my heart to hear that-they could be doing so much better and have TONS less stress!

  19. Here you go! : )1. Saving a buck here and a buck there makes absolutely no difference. Yesit does!! Saving a buck here or there, each time you shop, can add upto A LOT  of saved bucks, which you can then save, or use on anindulgence if you so choose. Saving money, like buying the store brandinstead of the name brand can really pay off in the long run. Unlessyou KNOW that the name brand is better quality, or something to thateffect, then you would spend more for the name brand, but if they areof similar quality, then SAVE MONEY and buy the cheaper brand.2. You either have it or you don’t, and scrimping won’t matter.Nottrue at all. If you save for any purchase (large or small) cutting backand saving and keeping track of how much you spend WILL eventually getyou enough money to afford what you want.3. Wealthy peoplegot that way because they got a good break/inherited it/just happenedto be in the right place at the right time.No, no, no. Many wealthypeople got where they are because they WORKED HARD, and hadDETERMINATION and DRIVE to do so!! Whether they were college dropoutswho invented the greatest operation system ever, or college grads whohad to work their way up from the lowest rung on the ladder, they knewwhat they wanted to went after it. It’s not always about catching alucky break, and the people that are truly wealthy, go that way becausethey knew what it took to get what they want. I believe theperson who you talked to was GROSSLY misinformed, and as you stated, heis  the type to have no money, wanting to share etc. Maybe he shouldtake the time to understand what he is saying.

  20. homefire says:

    @der_lila_Stern – @emeralds – @fwren – Thank you all very much for sharing your personal testimonies!  Lots of great comments–thanks, everyone!

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