Tuesday, December 29, 2009

Frugal Fatigue? - Do we really need to overspend for the economy to recover?

I was listening to NPR this morning as they interviewed an economist remarking how this holiday season returned better than expected earnings for retailers. The economist used an interesting phrase that I was compelled to look into further “frugal fatigue.”

Supposedly after years of recession people are “tired” of pinching pennies and have started going out and spending a little because “it feels good”. The worse part about this is that all the articles I have read mark this as a good thing (save one: thank you Suddenly Frugal Blog ).

It would be great if confidence in our economy were encouraging people to spend more because they can see their economic future getting brighter and don’t see the need to hoard every dime for the inevitable rainy day but that is simply not the case. People are feeling “frugal fatigue” so engaging in “shopping therapy.” Does this make sense?

Is it true that the only way to recover from our financial crisis is to go back to shopping as a cure for the blues? Is the holiday season just an excuse for everyone to go get further into debt without feeling guilty about it?

So what can we do about frugal fatigue?

  • Don’t use shopping as therapy – Yes, shopping feels good. Buying an item out of impulse feels good for the moment. But would you buy that item if the tag or advertised priced showed the actual cost of the item? Do the math.

    Price + Tax + Credit Card Interest Rate x Number of Months it takes you to pay it off = not such a great deal.

  • Live like an Affluent Pauper – Don’t spend more for anything out of ignorance. There are deals to be had you just need to spend the time doing the research and yes even clipping the coupons. Don’t spend impulsively.
Yes the country as a whole is in a recession but I refuse to believe that saddling ourselves with debt is good for America. Instead I will continue living frugally because you know what really feels good? Being debt free.

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  1. Thanks for the shout out to my Suddenly Frugal blog. I hadn't re-read my "fight frugal fatigue" post in quite some time, and I'm glad you gave it the thumbs up.

    Leah Ingram

  2. How ignorant is it for people to believe that we should be spending money we don't have to help us get our of the recession caused by over spending.

    There can be a fine balance between hoarding and saving. Buying wisely and saving for the future while get us out of the recession. We just can't get out of it any faster then it took us to get into it. If however, people were to just hoard all their money and only buy the cheapest food and nothing else. Then we will only get worse. But the last time I checked, people will still shopping.

    Thanks for the great post!

  3. It's going to be interesting in a few months. I think that if people did overspend we'll know then! I know personally I didn't. :)


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