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Book review: “The New Frugality” by Chris Farrell

2010 July 19
by Charlie

After going through the Great Recession of 2008 to present, I couldn’t suggest any better book to read than The New Frugality: How to Consume Less, Save More, and Live Better. For anyone looking for radical change in their life after realizing they’ve consumed too much and are in too deep of debt prior to the Great Recession, then this is the book for you. The New Frugality gives a fresh post-Great Recession perspective on how living beyond our means for the past half century has finally caught up with us and people are going to be forced to change. Along with this, resources on the earth are being strained and with the buzzword of Global Warming being so popular, Mr. Farrell believes that a new type of frugality is coming about. It’s one that isn’t by choice, but one of necessity. With savings at zero percent, the average credit card balance at $15, 788, and lots of families already requiring dual income providers he writes, “this time is different.” Meaning…people can’t be stretched any further. They can’t have a third income provider. They can’t continue to save into the negative and people’s credit cards can’t sustain much more damage. Drastic change is needed and this change is “The New Frugality”.



What is “The New Frugality”:

It is a blend of being frugal and being green. It’s creating a margin of safety in all circumstances from mortgages, to emergency funds, and to retirement savings. Its about consuming less or “an embrace of a sustainability ethic or outlook.”

Book Rating by ThreeThriftyGuys.com:

I rated it four out of five stars because he did a great job of showing how our history has brought about needed change in this generation. A change of thrifty and green-ness. One that buys on the thrift, but considers the impact on the environment. It does a great job of not getting into the “quick tips” or “do like I do”, but shows how the choices of our past are forcing us to live more environmentally and financially sound. I probably would have rated the book higher but I felt after about Chapter 6 it felt a little too similar to the books you read by Suze Orman or David Bach about 401k’s, mortgages and saving for college. I thought he could have continued to focus more on similarities between the Great Depression and the Great Recession and how change will be similar to the post-Depression generation.

Who should read “The New Frugality”:

People who are struggling with making ends meet after the Great Recession or who haven’t ever created a margin of safety in their decision making. If you think being “green” is a hippy term. If you want to live a different life than everyone else. If you don’t think sustainability and thrifty are synonymous.

Key take aways or quotes I enjoyed:

  • “personal finance is really about deciding how to live your life, figuring out what you really cherish and value, then putting your money behind those goals and beliefs.”
  • “The Great Recession marks a major inflection point in managing our money. Our love affair with consumer debt is over.”
  • “The New Frugality signals that a half a century of people spending with abandon and borrowing as much as possible is done.”
  • “The country has drifted away from the concept of thrift to our detriment” quoted from Robert Frank
  • “The New Frugality….managing our finances with a margin of saftey in mind.”
  • “The New Frugality reflects a growing embrace of sustinability ethic or outlook.”
  • “being frugal and being green are synonymous.”
  • “this time its different”
  • “The signs of a new world are all around us. The time the epicenter of change is the household. The age of excessive consumption supported by consumer borrowing is finished.”
  • “The Great Recession has taught all of us that it’s financially dangerous to carry too much debt.”
  • “Make frugality a habit.” “Don’t spend more than you earn.”
  • “Compound interest is how the financial turtle can beat the money hare.”
  • “The combination of frugality, sustainability, planning, and thoughtfully developing the money-saving habits that reflect your values will prevent the “Don’t spend more than you earn” perspective from turning into cheapness.”
  • “Sometimes you need to make a bigger break in your spending pattern to boost saving or pay down debt. The answer: downsize.”
  • “Consumption signified the wasting disease of tuberculosis.”
  • “Living debt free is wonderful.”
  • “Make debt reduction a priority…. Remember small steps add up over time.”
  • “Remember the concept of compound interest? It’s the saver’s friend. It’s the borrower’s enemy.”
  • “the quicker you are able to live debt free the greater your margin of safety.”
  • “You can’t beat the market, so join it.”
  • “the best way to fall short when it comes to stock market returns is to pick an actively managed mutual fund, socially conscious or not, over a broad based index fund.”
  • “Diversification both reduces investment risk and increases the odds that you’ll earn a decent return over time.”
  • “The real benefit of dollar-cost averaging is that it takes emotion – fear, greed, and panic – out of investing.”
  • “One of the biggest money mistakes people make is to simply turn their money over to professionals and assume they’ll do all the work. That’s a recipe for trouble and disappointment.”
  • “The returns on getting started early are enormous, and not only because savings compound with time, as do the financial and environmental gains from sustainable frugality.”

For me, having grandparents that went through the Great Depression and seeing their daily example, I thought “The New Frugality” was already established by that generation. I heard many stories of my grandpa scavenging the junk yard for “slightly used car tires” that he would repair because new tires were expensive. Or how grandma would make her own laundry and dish soap. I remember hearing the lecture of eating everything on your plate, and how the Great Depression changed their eating habits. Or how you could reuse old socks, shirts or dresses to make dish rags for common kitchen use. And heaven forbid if they’d throw away a bread bag which could be reused for some other purposes. For my grandparents, living frugal and green is a common practice after living through the Depression. They were green before it became cool or before Al Gore “invented it.” Chris Farrell does a great job of blending modern day topics, like debt, sustainability and the Great Recession into 21st century lingo that should be embraced by more people today than ever. If  you are looking at creating a margin of safety in your life and learning how consuming less is more, then this is the book for you.

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To enter to win a copy of The New Frugality, Three Thrifty Guys wants to hear from you!! You can enter to win by commenting on this post about, “How your life has changed since the start of the recession.” What are you doing different? Have you lost a job? How are you being more environmentally conscious?

Comment by this Thursday for a chance to win. Winners will be notified on Friday.

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Charlie

An IT professional, Charlie also buys and sells liens, lives on the cheap, runs marathons and helps to run his family farm. In his spare moments, he raises 3 children, does the dishes and writes one post a week. His former blog, Frugal Retirement Plan, has been cited by US News and World Report.

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15 Responses
  1. Judy permalink
    July 19, 2010

    Sounds like a great book, Charlie. My life has not changed since the recession as I have always lived rather conservatively and I’m on a “fixed” budget.

  2. Jenna H permalink
    July 19, 2010

    We are going out less and using coupons alot more!

  3. vickie morgan permalink
    July 19, 2010

    I’ve just started using coupons like crazy and try to get the best deal possible on everything!
    We also garden organically -no pesticides whatsoever. We compost and recycle more.

  4. DionneJ. permalink
    July 19, 2010

    I have been using alot more coupons~I shop ads at the local grocery stores to get the best deals. The book sounds like a good resource too.

  5. July 20, 2010

    We’ve really cut our miscellaneous spending and avoid shopping for fun!!

  6. Shannon permalink
    July 20, 2010

    Sounds like a good read! We’ve been really trying hard to tighten up on our budget and track where our dollars go to minimize wasteful spending. To help with this, we are learning the art of ‘couponing’ and have found it to be quite helpful and addicting! :) We also are into recycling and reusing things the best we can. Saves us money and helps the earth too! :)

  7. Jane Logan permalink
    July 20, 2010

    Life has not really changed that much but I have started to read more blogs on saving and as I live in Australia, it is winter and this year the jumpers, blankets and hot water bottles have been used instead of an oil heater in each of the three bedrooms. We have just had our first electricity bill and it is $300 lower than same period last year. So I am happy with my small steps. Thanks for providing such an interesting site.

  8. Sara permalink
    July 20, 2010

    The recession of 2008 really didn’t change our spending habits much, as we have been living frugally for years. Our spending habits changed the most by hearing/reading/participating in the Dave Ramsey course about paying off debt. It’s amazing how a little more attention to your spending makes a huge difference. We spend less and are paying off debt as fast as we can now (while still living and enjoying our lives). We are now up to the point of tripling our morgage and only have one college loan and house to pay for. This book sounds like it would be a good read.

  9. Glenda permalink
    July 20, 2010

    I live in Ga and the unemployment rate is STILL at 10% (which is above the national average) and that’s just the reported job losses–people whose unemployment have run out or couldn’t get any aren’t recorded. I don’t have a large circle of friends but when the “Great Recession” hit, all of us had someone who lost a job, whether spouse or immediate family. In my family that person was me. I worked for the State and have been put on furlough, but this furlough has lasted a year and a half now. My husband and I laugh sometimes because while we know the State is in financial distress, if my little part-time check was going to make a difference in their mountain of debt, well, then we really are in trouble. Of course, the loss of my little check made a BIG impact on us. In some ways, I think it was a blessing in disguise–just not a blessing that needs to keep giving, if you know what I mean. :) While I’ve always been as green as I can, we were caught on the spending carousel. Granted our debt was and is very low (I used to be a debt and credit counselor so I did take my own advice). However, the job loss has brought things closer to the wire and made us REALLY look at our finances. We’ve realized we needed to be saving more for retirement and spending less on the NOW. So, gone is the cable and hello to Netflix. Gone is the lawn guy and I am now familiar with the electric lawnmower I invested in. I think in many ways, our lives are ‘healthier’ for the change, I only wish my husband did not have the added stress of being the only ‘breadwinner’ with the constant fear of ‘what if it’s my job next.’ Unfortunately, employers around here are taking advantage of that fear and benefits have been lost and the work environment leaves much to be desired.

    So, having said all that, I’d welcome the book. I like the green=frugal take plus the added bonus of an added financial seminar. I did chuckle a bit about the bread bags comment–my parents had me late in life and had both lived through some of the Depression and WWII. I remember having to clean out bread bags and use them until the colors came off on my fingers–and I’m only in my 40’s.

  10. Amanda C permalink
    July 20, 2010

    My husband lost his job when the recession hit. He works as a pipeline inspector. He was unemployed for a full year despite having a college degree and experience in several different fields. He is now working 5 hours from home on a constuction project.

    I am a stay-at-home mom of four. We have been spending more time doing free activites at the library and park. I use coupons every time I shop. Also, we are in the process of wiping out our debts. I don’t ever want to be dependant on credit cards again.

  11. Noelle Mathison permalink
    July 21, 2010

    Things haven’t changed too much for us since the recession hit. My dad has a pretty secure job, so it hasn’t affected us in that regard. We’re always trying to pinch pennies, so that hasn’t changed either! However, it is HARD to pinch pennies — especially as prices are rising now. So we would really love to have a copy of this book to help us develop our penny-pinching muscles ;)

  12. July 21, 2010

    I run my own business and have had several clients pull back on spending, so I’ve needed to pull back too. I am trying to save more in months when I make more so I have a cushion to fall back on in lean months.

  13. Liz Friesen permalink
    July 21, 2010

    Like Amanda C, we have been utilizing free summer entertainment. Last summer we did camps and such, this summer free stuff. Our favorites are our weekly outing to the library, play dates with friends, swimming at the pool at the gym we belong to, and playing at Grandma’s house. We have had so much fun with a flexible unscheduled calendar, that we haven’t even missed the scheduled stuff like camps.

  14. Jared permalink
    July 21, 2010

    We’ve also dropped cable and gone to antenna+tivo+netflix (with many kids videos that can be instantly streamed directly through the tivo). Occasionally painful but generally not to bad.

  15. July 21, 2010

    Since the recession I, like many, use more coupons, eat out less and try to make the most of what I have. I feel like I’m trying to do many things that my grandmother, who lived through The Depression, did, which I previously thought were a waste of time. Not so!

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