Can being a cheapskate make you happier?

May 19, 2011 2:20:26 PM PDT
Jeff Yeager is proud to call himself a Cheapskate.

He explains, "To me, a cheapskate is the opposite of a conspicuous consumer. Those are folks who spend and consume at warp speed and really show off. Cheapskates like me, we're too self-confident and too smart to spend money on things we don't need and probably don't want."

For his book, "The Cheapskate Next Door" he interviewed hundreds of fellow cheapskates and he says, recession or not, cheapskates tend to be happier than spendthrifts.

"It's not about sacrifice and deprivation," Yeager says. "We're all about choices. Ultimately, if you spend and consume less, you may actually be happier.Most Americans would be happier and the qualtiy of their life would increase, if they would spend and consume less."

Yeager says studies show that consumers regret about 80% of their discretionary purchases within a year of having purchased them.

Because cheapskates tend not to buy on impulse, they have fewer regrets and less debt.

And, he says, there are some "cheapskate strategies" that everyone can start using.

First, wait to buy.

"They try to wait a week between the time they see an item in the store and when they go back to buy it, Yeager says of cheapskates. "They report that half the time, they never go back to buy it. They realize that it would've been one of those 80% of the the things that would disappoint us."

Next, save twice what you need to make a big purchase -- not only will that force you wait, but you won't feel broke once you buy.

"One of the guys told me that his favorite tactic is to save twice, spend once.For a major purchase, he'll try to save up twice what he needs, before he goes and buys it," Yeager says. "He says if he does that, a couple of things go on. A lot of times, he decides, while he's saving the money, that he doesn't need the item, or he doesn't want it. Secondly, if he does pull the trigger and goes out and buys it, he doesn't feel poor afterwards because he saved twice as much."

Third, avoid plastic.

"If you pay cash, use cash instead of credit cards, you're much less likey to buy something, and much less likely to spend as much on it," Yeager says.

And finally, think about depreciation. Even small items like toys and clothes are worth less once you buy them. If you shop re-sale, you're letting someone else pay for that.

To read more of Yeager's tips, you can check out this website if you click here.