This is the first article from new staff writer Lisa Aberle, who has replaced Tim Sullivan.

When I first started reading Get Rich Slowly in 2007 or 2008, financial independence was only a dream. At that time, my husband and I were struggling financially. We had:

  • two mortgages
  • one car payment
  • no emergency fund
  • nothing left over after each paycheck
  • a zillion home improvement projects to do – and no money to do them

I hated living like that. Some financial pains were our fault, but some things weren’t. I wondered if we would ever get to the point where a financial emergency felt less like an emergency and more like a minor annoyance.

Financial transformation
To get out of the hole, I read this site along with many others and devoured personal finance books. I tried to learn everything I could about cutting expenses. And cutting expenses helped, but other things happened to give us a boost.

We sold one house. I got a promotion. All spare money went to pay extra on our car loan, and, once that was paid off, to an emergency fund. I started a personal escrow account to budget for our yearly expenses. As things improved, we gained confidence, and our financial progress snowballed.

We’ve now progressed enough on this journey that financial freedom no longer seems far-fetched. It won’t happen any time soon (at least, I don’t think so), but at least it seems possible now.

Now that it’s more real, I’ve been thinking about the options that would be available once we achieve it. And I want it earlier rather than later. To reach this goal, I need to do several things:

Though all four things will be (and are) part of our plan, this article is about frugality.

When financial freedom seemed impossible, I concentrated on saving money. While I know I need to make significantly more money (and invest that money) to gain early financial independence, I still think frugality has a place (after all, you must spend less than you earn).

Even though frugality has a purpose, as we started making financial progress, saving time and energy seemed as important as saving money.

I began to question my actions: Would reusing aluminum foil or plastic baggies make a difference to my goals? With unlimited time and energy, discerning the difference between worthwhile (and worthless) actions to save money is important.

Frugality, kicked up a notch
So here’s what I did: I categorized our entire budget into three categories, each one with different advantages and disadvantages.

Fixed expenses. Bills in this category include phone and insurance. My husband and I shopped around for new insurance policies, raised deductibles, dropped services, and picked a new cell phone plan.

Verdict? We are saving $300 per month, and we invested little time. Totally worth it.

Variable expenses. Food, utilities, clothing, and transportation costs make up this category. I waste food, because I still think buying in bulk is less expensive. We also save $1000 annually by heating with a woodstove. Much of our clothing comes from thrift stores.

Verdict? Sometimes I put a lot of effort in, and I’m not sure it’s worth it. For example, even though we get free wood to heat our house and it saves us $1000 annually, I think it takes us 100 hours per year to split and stack the wood. We’ve “earned” $10 per hour with manual labor, but maybe our time is better spent elsewhere,especially since both of us earn more than that in our full- and part-time jobs.

Variable, big expenses. We approached our biggest purchase (our house) with a mix of optimism and stupidity. (So much stupidity that the topic deserves its own article.) We did everything wrong, and I estimate our mistakes cost us an additional $30,000. Oh, and we didn’t negotiate at all when we purchased our last car.

Verdict? When huge amounts of money were at stake, we wasted it. So unfrugal of us.

Evaluation time
I’m not sure how much money I’ve saved this year by not buying cooking spray and reusing foil and plastic baggies…maybe ten dollars?

Compare that to our house-buying debacle, the $30,000 mistake. That’s a lot of aluminum foil.

Sure, we probably won’t buy a different house for a long time, but that’s not really the point. If I’m truly looking at frugality as a method to conserve time, energy, and money and achieve financial independence, I’ve been concentrating on the wrong things.

So what should I focus on? Well, when large sums of money are involved, I need to spend my money carefully, in an informed way. That should be obvious, but I think I thought, “We’re spending so much money already, what’s another two thousand dollars?!”

And if money-saving tactics (aluminum foil, I’m looking at you) take too much time, I would be better off using that time to educate myself to make better investment decisions, or earning money in a different way.

That’s just one way to financial independence. But it’s still hard to throw away perfectly good piece of aluminum foil.

GRS is committed to helping our readers save and achieve their financial goals. Savings interest rates may be low, but that is all the more reason to shop for the best rate. Find the highest savings interest rates and CD rates from Synchrony Bank, Ally Bank, GE Capital Bank, and more.