Knowing your needs and wants

In order to live a frugal life, it is necessary to draw a line between your needs and wants. Lets start with what they really are.

Needs are the basic necessities of life without which we cannot live. Food, shelter and clothes are the most basic needs of human beings. Apart from that, health care, transportation and education  have also become an integral part of our lives. Needs are pretty much standard for every human being. We all have the same needs.

Wants are those extra things that "may" improve the quality of life but without which life does not come to a halt. They are the tools of indulgence. Going on a vacation, wearing expensive clothes, eating out, collecting new gadgets, etc are things that are beyond the needs. They vary from person to person. I may like to buy new gadgets but to you, it may seem totally wasteful. You may like to go on expensive vacations while your friends may think you are crazy.

Becoming Frugal and Learning to Save Money: A Lifestyle Planning

When talking about becoming frugal and saving money, you have to start by looking at your current lifestyle. You may need to plan things differently to make the most out of what you currently have. Saving money and becoming frugal is not only about how much you earn and how much you have in your bank account. I look at it from a much broader perspective. It's the lifestyle you choose that either makes it easier or harder in becoming frugal.