Sometimes I’ll be talking about frugality with somebody who says, “Why bother? Pinching pennies all the time makes me feel lousy. Besides, you can’t really save that much money. You really save money on the big stuff.”

This is a common response to frugal living. I have some standard replies:

  • It is true that it’s important to save money on the big stuff, like a home or a car. Any time you make a large purchase, your opportunity to save is magnified. Take special care with these sorts of decisions. Don’t buy more than you need. Don’t buy more than you can afford. Strike the best deal you possibly can.
  • But large transactions are rare. How often do you spend more than $100 on anything? You have more opportunities to save when shopping for groceries. Saving fifty cents a week on milk is inconsequential as a one-time occurrence, but over the course of a year, it amounts to $26. Taken together, many such small economies make a real difference. Small amounts matter.
  • Remember: Don’t confuse frugality with depriving yourself. If pinching pennies makes you feel lousy, then loosen up. Spend a little more. I am not advocating “retail therapy” or spending above your means — I’m telling you that it’s okay to spend more for your favorite brand of yogurt or to get your favorite cut of beef. If you don’t like shopping in thrift stores, don’t.

Frugality doesn’t mean living like a pauper. Frugality means choosing to make the most of your money, to focus on everyday costs, to recognize that small amounts matter. Sometimes I think we frugal folk should be calling ourselves “thrifty” instead.