7 ‘Big Wins’ to Overcome Frugal Failure

big-winsIn the previous post, I wrote about frugal ideas I hate and that I think are a waste of time. Today, I’m concentrating on the “big wins,” as Ramit calls them. This is the stuff I’d file under “too valuable to ignore.” These big wins can save you hundreds of dollars right away and thousands in the long run.  They’re not simply about saving a buck or two here and there, and they’re fairly practical rather than quirky or unconventional.

Here’s my list of powerful tactics that lead to big money wins.

1. Negotiate your salary. If you don’t even try to negotiate, you’re losing out. It’s easier than you think and just a little bit of effort can make a thousands of dollars in difference over your career. Plus, there’s very little at risk when you negotiate (the worst case is you get a “no”). Remember that negotiating your starting salary is most important.  This is the number you’ll be working off of from then on, so don’t sacrifice when you’re hired and expect a big jump in salary later.

2. Investing early and adequately. You simply can’t replace the value compounding returns if you wait to invest until later.  It’s extremely important to get your money invested as soon as you can.  At age 25, I don’t worry about timing the markets since returns tend to average out nicely over the long term.  When I reach retirement age, I expect I’ll have earned about 12% per year over 40 years based on the history of the stock market.

3. Tracking spending and budgeting. This one makes both lists! Even if you think you’re cutting back by being frugal, you’ll never know for sure if you don’t do some level of tracking.  Budgeting is important, too, so you can make sure you’re hitting your financial goals by saving and investing consistently and effectively (and following #2 on the list).

4. Earn more outside your job. This is another example where time spent on earning more is much more valuable than clipping coupons and pinching pennies.  Undoubtedly, you have at least some free time to devote earning money on the side.  It can involve as little as five hours a week. Take some time to brainstorm some ideas of how you can earn money.  It could be odd jobs, selling things, or providing your services to others.  If you can’t get a job, there are other ways to make money, too.  It’s really about finding a combination of using your skills and being resourceful and creative.  Remember: you don’t need to be an expert. I’m a freelance writer on Adaptu, but I don’t have a Ph. D. in writing.

5. Cut the recurring bills.  Ramit shows one reader’s 2-week savings from canceling his gym membership, switching banks, and moving to the best cell phone plans to saved $1,400 a year. This is about the same as giving up 250 lattes for the 12 months. Which is easier to you? Cable TV and/or Satellite is also an easy one to cut out. DirecTV can charge some hefty fees With free programming available, it makes no sense to shell out close to $100 a month on cable. If you concentrate on things you don’t consistently use that cost $10+ a month but get billed automatically, you’ll come up with some great savings with very little effort or change in your life.

6. For recurring bills you can’t eliminate, shop around.  In about 20 minutes, you can research and switch to cheaper car insurance. There are tons of options out there, so don’t assume that your current plan is the best. If you save $400 in that 20 minutes, that’s an incredible hourly rate for your effort.  This works for just about any industry that has multiple carriers: cable, cell phones, internet.  Consider the alternatives when you have options, and this step becomes just as effective #5.

7. Pay off debt quickly. I’m sure this is something we all want to do but not everyone pays as much attention to it as they should. If you leave college with about $23,000 in student loans, like the average student, you’ll pay almost $9,000 in interest if you pay the minimum over 10 years. If you want to save big on interest, always pay more than the minimum payment on your loans. In the same scenario with $23,000 of debt, you’d cut your interest down to about $3,500 if you doubled your monthly payments.  Paying off loans allows you to start investing sooner, giving you the ability to grow wealth instead of merely paying down your debt.

The bottom line: if you don’t focus on these things, you’ll easily wipe out your frugal savings you’ve made by concentrating on the small stuff. The best part about focusing on the “big wins” is that you don’t need to pick dozens of them to work on.  Pick a few and you’re on your way to saving big.

Do you have any “big wins” that you’re going after?

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photo by: Sue Peacock


  1. There is definitely a move away from simply cutting back, and being blindly frugal, towards capitalizing on a more favorable economy. Really, when you look at what can be saved from extreme frugality, it makes more sense to focus on increasing income. Cutting back is like rubber band, you can only stretch it so far.

    I especially like negotiating for your salary. As you say, it’s a no lose proposition if you do it tactfully. I have had to fight for every dollar in increased pay over my career. It’s important to ask, if not, you probably won’t get what you want.

  2. This is all great advice.  I think points 1 and 4 are particularly important. Things like shopping around to get good deals and the importance of investing are widely covered but the ways of attracting more money rather than saving it can be the most powerful if you continue to live a relatively frugal lifestyle. People seem to be conditioned to think that you get money from your employer, that they decided how much that is and that’s the end of it. Every time I create a new income stream for myself, I get such a sense of achievement no matter how small that stream may be.

  3. Buying a house and getting a roommate to help pay the mortgage.

    Thanks for the Adaptu mention!

  4.  #1 is definitely more important today than it was even 4-5 years ago.  Recent studies are saying that the average college grad is getting offers for thousands of dollars less than graduates a few years ago, and from historical studies they’ve noted that if you don’t do well with your first few jobs (in relation to your peers) you’re unlikely to catch up.  

    That’s a big price to pay for bad timing, but hey, at least we’ve _some_ control.

  5. My “big win” will hopefully be getting my MBA with no student loans.  I’m on track for the first year to pay what I owe beyond aid in cash. … of course I’m going to have to be pretty frugal to make this work but I think it will pay off big time in the medium/long term

    • That’s great! That would be a huge win.  I overlooked skipping loans altogether since I simply included “paying off loans,” but not getting them in the first place is obviously a superior option.

  6. Margo Mosher says

    What do I suggest for a student who wants to start investing but doesn have a substantial chunk of money to invest? What could indonwih $500 that would be smart? Or is it best to wait until I have something more to invest in a couple years?

    • I don’t think it’s ever best to wait a few years if you can afford to start investing now. I would fund a Roth IRA with the $500.  If you already have one open, you can simply buy more of the same fund you already have.  If you don’t, you can search for mutual funds with a low minimum (which might require you to save a little more than $500 first, depending on what you can find).

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