One’s Frugal Fail is Another’s Frugal Success

Confused?A tricky part of living below your means is knowing a good value when you see one.  Recently we ran a Frugal Fail about McDonald’s $1 Sweet Tea, and how buying drinks out daily was a great way to spend a lot of money on something that didn’t have much worth.  Of course, just a few weeks earlier, we had posted that McDonald’s $1 sodas were a good value relative to buying a soda at a convenience store.

What gives?  Are we hypocrites?  Contradicting ourselves?

Not really.  Our philosophy is that money is a tool that one uses to achieve happiness, and you have to know what makes you happy in order to use it properly.  Otherwise, living within a budget is just a grind.  In other words, something is only a good value if it is worth it TO YOU.

If 95% of the time you don’t spend a lot of money on drinks, then the $1 McDonald’s soda is a pretty good deal, especially if you compare it to the $1.69 to $2.99 that you’re going to pay in a convenience store.  The $3-$4 drink at coffee shop with a few friends on a Saturday afternoon is a great way to spend some time in a pleasant atmosphere (especially if you consider the number of hours of enjoyment you are getting from the experience).  But if you’re spending that kind of money most days on drinks — especially the kind you bring back to your desk and hardly notice that you’re drinking — then it’s likely you’ve gone from spending your money on something that makes you truly happy, and paying an awful lot of money to avoid brewing your own coffee or tea and putting it in a thermos in the morning, or remembering to grab a soda out of the fridge to drink later in the day.

Now, there is also the argument to be made that you are paying for convenience.  Understanding the value of convenience is a great subject for living richly, and we’ll be exploring that question next week.

 

Photo Credit: San Drino

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