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The Leap to Cheap

Spending is out, simplicity's in. Why the nation's thriftiest people are also the happiest.

Leap to Cheap

— Teru Onishi

 

 

Among their savings secrets: Live cell-phone free ("It's a quality-of-life issue, too"), wear your clothing until it's truly worn ("It's like losing a friend when we consign a shirt to the rag bin"), and save twice the amount needed for a major purchase before you buy it ("It lets you make sure you really want it, and—if  you do buy it—you don't feel broke afterward").

"For us," Newman told me, "a true sign of wealth is free time—freedom from drudgery and unwanted commitments. In terms of baubles, we might be living below our means, but in terms of the things that really matter, the Queen of  England doesn't have it any better."

You don't need to go back to the Puritans or Poor Richard's Almanack to find when penny-pinching was last a source of pride. The YMCA and other civic groups launched National Thrift Week in 1916 to promote frugality "For Success and Happiness"—or so the official slogan proclaimed. Thrift Week celebrations were held throughout the land, and they included sexy-sounding events such as Have a Bank Account Day and Pay Bills Promptly Day.

National Thrift Week had a long run—until 1966. That year, it so happens, "Time" magazine ran a cover story entitled "What's Good for the Economy." An excerpt: "For 62 fat months, prosperity has fed itself because Americans have spent, lent, borrowed and invested with confidence. They have felt correctly that jobs, production, profits and paychecks would continue to go up and up." Meanwhile, household debt as a percentage of disposable income had nearly doubled since 1950, from roughly 35 percent to nearly 70 percent. Thrift Week had been replaced by a newer national mandate for success and happiness: Spend more than you can afford, and our economy will boom.

Fast-forward to today, with personal bankruptcies and home foreclosures near all-time highs. The average U.S. household owes about $7,500 in credit-card debt. Almost half of workers live paycheck to paycheck. Sometime in the 1990s, says Boston College sociology professor Juliet Schor, Ph.D., consumers went into overdrive, egged on by easy credit and real-estate values on steroids.

According to Schor, author of The Overspent American: Why We Want What We Don't Need, keeping up with the Joneses suddenly wasn't enough anymore. Now we had to surpass them, to live, as Robin Leach would say, the lifestyles of the rich and famous. 

How long ago that now seems.

A familiar line item in the budgets of the thrift mavens I met is zero. They spend nothing, or close to it, on fast food, clothing, or the latest whatsit. "Like a lot of moms," says Welmoed Sisson of Gaithersburg, Maryland, "I love shopping with my daughter, but it's just to laugh about how much stuff people buy that's totally unnecessary, not to buy things ourselves. It took me a while to explain to our kids that if a company needs to advertise all over the place, it's something that people really don't need. But eventually they got it." Confirmation came when her daughter scored a thrift-store find: an elegant black dress for $12.50 that she wore to her senior prom.

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