20 Ways To Earn More & Spend Less: Steps To Become A Frugal Capitalist

by Silicon Valley Blogger on 2008-04-1529

Are you a frugalist, a capitalist or both?

Here are some loose (ballpark) definitions to help you with that question:

Frugalist: someone who is thrifty and who puts emphasis on saving money.
Capitalist: someone who enjoys pursuing money-making ventures and who focuses on income generation.

I had asked this question earlier, and as expected, most people who responded to this have mentioned that they follow both views as they deal with their finances. Seems like the hybrid approach to money management and thought is a popular choice for many finance buffs.

To summarize: the argument is that we’ve got a limited X amount of time to spend. And if we are to optimize how we spend our valuable time while trying to maximize how much money we end up keeping at the end of the day, then what is it that you do? How much time do you spend on frugal exercises vs money-making activities?

I thought this was a compelling question to mull over and to help you assess whether you’re truly doing all you can or are capable of doing to improve your financial situation. If this so happens to be one of your goals in life.

Well, whichever camp you’re on, I thought I’d give some concrete (though general) suggestions on how you can hang on to more of your money by spending less and earning more, hopefully at the same time! Here, I share with you some steps to becoming a frugal capitalist.

saving money, piggy bank

Spend Less Than You Earn: 10 Simple Ways To Spend Less

The keys to spending less are discipline, attitude and organization. If you’re able to delay gratification and say “no” to your inner demands, at least for the time being, then your determination should reward you with more dollars left over at the end of the day.

#1 Avoid temptations.
We’re all subjected to 24/7 advertisements and promotions and have born the brunt of marketing campaigns. Just try sitting through your favorite popular program on television without feeling like subliminal messages are being programmed straight into your brain through not-so-subtle endorsements and commercials. How do you avoid the temptation to consume? Easy. Avoid the source of temptation. Watch less or no television if you can help it. Avoid window shopping. Avoid the Joneses. 😉 In my case, I don’t mind being bombarded by advertising and the call of consumerism. I have nerves of steel and have very strong will power, and it’s easy for me to say “NO” to myself.

#2 Use grocery coupons and buy generic items.
Develop a routine that involves organizing and collecting coupons and coming up with a system for buying items. Work on becoming a savvy, smart shopper, buy generic items, shop on sales days.

#3 Don’t use credit cards.
Keep a limited number of credit cards — a couple is enough, in my opinion. If you’re going to use cards at all, go for those with 0% APR or those with rewards, like cash back credit cards. Better yet, cut them all up and use cash! You’ll spend 12% to 18% less if you make it a habit to use cash in your transactions.

#4 Make a list.
Always prepare a shopping list before you go out and buy anything. This will help you stay focused on what you need to buy rather than on what catches your eye when you’re out on your shopping trip. This should help curb impulse purchases.

#5 Pay yourself first.
Designate a certain amount of money and have it set up to move automatically into your savings account each month: aim to save at least 10% of your gross income. By doing so, you pay yourself first and it’s money that is “out of sight” and hopefully “out of spending reach”. In other words, if you don’t see this money sitting in your checking account, you’re less inclined to use it.

#6 Cut out your vice habits and drains on your dollars.
If you’re serious about cutting the fat out of your budget, try to hit those things that aren’t really doing much for you. Sorry to be a wet blanket, but vices are a good place to start. Here is a common list of money drains you could probably do without:

  • Coffee
  • Cigarettes
  • Alcohol
  • Bottled water from convenience stores
  • Manicures
  • Car washes
  • Weekday lunches out
  • Vending machines snacks
  • Interest charges on credit card bills
  • Unused memberships

#7 Shop at discount stores and outlets.
Buying in bulk will help you save money and in the long run will help you spend less. It’s just more economical to visit discount stores. Marshall’s, Ross Dress For Less, Costco will cost you much less than Macy’s, Nordstrom’s or Safeway.

#8 Buy used.
Want 50% or more discounts on anything? Try Craigslist or your consignment centers. I’ve been amazed by some of the quality I’ve seen at stores and places I’ve picked up used items from.

#9 Downsize.
The moment you downsize, whether it be your car, house or your entire life, you’ll immediately notice what a big break you’ll be giving your wallet. Everything we own these days requires some amount of maintenance, and what many people don’t realize is how much it costs to sustain the stuff we buy. The bigger your car, house, or hobby, the more money you normally end up shelling out to maintain them. Clearly, downsizing and “simplifying” means less maintenance and therefore, less bucks spent.

#10 Postpone purchases.
Delay those purchases you have planned as much as you can. Or make purchases in installments (unless you get charged for it) to buy yourself some time and stagger the financial load. It’s almost as good as saying “no”.


earn money, business, investing

Earn More Than You Spend: 10 Popular Ways To Make And Earn More Money

#1 Get a 2nd job.
Moonlight if you can handle it! Around 7 to 8 million Americans hold 2nd or 3rd jobs… but it can be a tough situation when you’re on the job for at least 12 hours everyday or sacrificing your weekends for the extra money.

#2 Work harder at your job and aim for a raise.
Well yes, we can always try to do better at our own jobs and work on nurturing and cultivating our career. Some jobs, especially those that are offered by some of the best companies in the nation, provide so much more than a basic salary. You can toss in various perks as well, such as raises, bonuses, matching 401Ks and even stock option plans in the mix. All the perks alone can easily add 25% to your base salary… which wouldn’t be too bad!

#3 Do a side business.
It’s probably better use of your time if you build on a side business than work on a side job. A side business is something you can cultivate independently and can easily last longer than any side job you decide to take on. Who knows — many part-time businesses have eventually grown to become the main source of work and income for many.

#4 Sell your used items (recycle and sell).
Cash in on your clutter! What a way to be kind to the environment and pocket some extra change at the same time. The advent of online auctions such as eBay and online classified sites such as Craigslist makes this all even more convenient! Especially if you’re not the type who enjoys spending your weekends holding garage sales!

#5 Invest smartly and make your money work for you.
Once you have some disposable income after retiring your consumer debts, then get your money to work for you by investing prudently. After some time, the compounding effect on your money makes it seem like you have an extra income source — actually, a good investing strategy allows you to develop a healthy, passive income stream.

#6 Invest in yourself.
Discover your strengths and talents and capitalize on them. And by keeping a positive attitude and doing something you love…well you know how that saying goes. This cliche holds true though, as we’ve seen many people who’ve done very well by doing the things they enjoy; with time being limited and life being short, as they say — doing what you believe you like and do best can be emotionally rewarding as well as financially rewarding, given some time.

#7 Become self-employed.
I mentioned earlier that having a side business helps to add to your income. But becoming fully self-employed and having control of your own work can be quite fruitful for people who have an adventurous and entrepreneurial bent. Some of the wealthiest people around are business owners.

#8 Freelance.
Become a contractor and get some side projects! Since quitting my day job, I’ve been focusing my energies on my small business, maintaining web sites and freelancing. All in all, I’m making around 60% of what I used to make, but I hope that in several years’ time, the work I do will hopefully be pulling in an income that will equal what I used to get from my day job.

#9 Seek money-making opportunities and go after them.
This can go beyond looking into investment or business opportunities and participating in them. You can also decide to take a bit of a risk by considering places that have higher demand for certain work, jobs or skills that you may possess. How about moving to a new location that has higher demand for the type of work you’d like to do? Be on the lookout for opportunities and see where those can take you.

#10 Get a higher paying job.
This used to be a strategy I employed during the earlier years of my career. I was quite driven about my career at one point and was quite fearless at pursuing various job opportunities during the tech boom in the 1990’s. Definitely a big motivator was the compensation offered during that time — during the dotcom period, companies would outbid each other over resources, particularly over employees and workers. During that era, job hopping was a lucrative way of making more money.


As you can see, there’s no shortage of what you can do to be able to spend less than you earn (or earn more than you spend). Despite all these possibilities, I still hear a lot of excuses from people who feel it’s hard for them to hold on to money. I’m sorry for bringing in another cliche into this discussion, but I must say that “if there’s a will, there’s a way”. By being resourceful, determined, focused and disciplined, you’re on your way to reaping financial rewards down the road.

Copyright © 2008 The Digerati Life. All Rights Reserved.

{ 27 comments… read them below or add one }

The Shark Investor April 15, 2008 at 1:17 pm

I truly enjoy your frugal/good shopping posts. Today people suffer financially mostly because of their own… umm can I call it “stupidity” to buy tons of things they don’t really need.

Save Money April 15, 2008 at 1:39 pm

I love your little spam protection thing. Refreshes me on my math skills each day.
I’m a Frugal Capitalist. I think how can I make money, without spending money. I don’t buy anything I don’t need and everything I want is there to make money, and save it at the same time.

Emily @ Taking Charge April 15, 2008 at 1:40 pm

Love this post — full of great tidbits. Regarding your first point on spending less, by avoiding temptation — I have a great technique for this. I DVR my favorite programs (with Time Warner Cable, the DVR is only $6.95 extra a month — with some cable companies, it’s free). I turn on the show when it’s half-way or all the way done recording and fast forward through the commercial breaks. There are multiple fast forward speeds, so if you fast forward quickly enough, you barely see the commercials and you’re back to your program within seconds. Another method to get a Blockbuster.com or Netflix membership (the basic plans are very cheap) and rent DVDs from TV series. That way you can watch the shows you’re interested in without commercials and without having to wait a full week between episodes.

My boyfriend and I watched the first three seasons of Lost on DVD and got SO into it, but started trying to watch the fourth season on TV when it started again recently. It was so different, and we were amazed at how difficult it was to get back into the show after each commercial break. We just felt assaulted by ads and wanted to get back to our show. We’ve started DVRing it and watching it once it’s recorded. So much better!!!

Leslie Raymond April 15, 2008 at 3:31 pm

This is a great post – I’m much more of the frugal person, but I can definitely see that if I could just earn some more money and STILL be frugal I could actually save instead of just barely making it each month. I have boxes of baby girl clothes that I was saving for my second child which turned out to be a boy — I just need to dedicate some time to selling it and there’s some extra income right there! Thanks for the inspiration!

Funny about Money April 15, 2008 at 9:32 pm

I love the way this post brings a lot of really good ideas together in one place! And a couple of your ideas speak directly to moi: downsize & start a side business.

After making pretty good money spending a semester teaching on the side, it’s dawned on me that even though freelancing wouldn’t bring in as much money it would form the base for a living income should I lose my job. Adjunct teaching can never do that, even if you do it the equivalent of full time.

Now all I’ve gotta do is figure out how to get clients. Have any clues? 🙂

Pamela April 16, 2008 at 9:51 am

Your very 1st way – avoid temptation – would probably benefit 99% of people who say they don’t have money to save – kick that Starbucks habit! The only thing on your list I don’t do is NOT getting manicures. In my job my hands are very visible & if I do my own manicure it looks like a 4 yr old with fingerpaints did it for me – this is one item I’m sorry to say that did not succumb to “practice makes perfect”!

The Personal Finance & Tax Blogger April 16, 2008 at 10:48 am

I love your blog and read it frequently. I agree that less is better when it comes to credit cards but do we really spend less if we don’t have credit cards? I think credit cards get the short end of the stick more times than not.

I feel credit cards save money! Yes, I said they save money and it will earn you money as well. Now keep in mind that you need a no fee card and pay the bill in full every month but it will save you money because you can leave your pay check in your bank account and earn interest during the credit card grace period. If you have as many bills a possible paid from your credit card you’ll maximize the amount of cash in your bank account.

You’ll have to ensure that your card’s maximum limit is reasonable as to avoid overspending, but really if you do it right you can earn bank interest by using your credit cards!

automatic translation April 16, 2008 at 11:55 am

The subject of the post attracts me a lot. In my words, try to use money after earn money and try to think about how to earn more money and then do it after having ideas.

Eric April 16, 2008 at 7:19 pm

I 200% agree with you not to use credit cards! When I was researching my money matters, I was surprised to find that over 10% of my spending are caused by credit cards! Now I paid off all of them and started to use debit card. Using cash is still not convenient enough for me.

Mydailydollars April 17, 2008 at 7:06 am

Great post! I’m really finding the magic in tip #10 — postpone purchases. My fiance and I considered buying a flatscreen TV at Christmas. If we had rushed out and bought one, we could have easily spent thousands. Now, we’ve decided we want to put it in a different room, so a smaller one will do. We’ll use the money from our garage sale to buy it. Just waiting and thinking through things really does make a difference!

David April 17, 2008 at 2:14 pm

Excellent post. You can also use the freecycle.org network for your area.

GL April 17, 2008 at 10:37 pm

Other than #3 – “Don’t use credit cards” – I really enjoyed your post.

Unlike most PF enthusiasts, I do not believe that credit cards are evil. I think a credit card is just a tool, and blaming it for one’s own incompetence makes as much sense as blaming a gun that was used to kill someone. (Yes, that’s an extreme example, I know, but it still works.)

I am aware of studies that claim that people tend to spend more with credit cards than with cash. However, if you’re a rational person and think before you buy, you can avoid that altogether. If you pay off your credit card bill in full, on time, and every month, you’ll get reward points, which can be as much as 5% of your total spending – in other words, you get a 5% discount on all your purchases. It quickly adds up if you use the credit card for your business expenses and large purchases.

Finally, using a credit card builds up your credit score, and credit card companies provide a great deal of consumer protection – unlike debit cards or cash. 🙂 As for myself – I am a college student with an online book-selling business. I got my first credit card 3 years ago, I’ve always paid it off in full, and I’ve enjoyed all the reward points and benefits it provides. 😀

Silicon Valley Blogger April 18, 2008 at 12:10 am


I definitely have no qualms with using credit cards. I love mine. 🙂 But it is a suggestion for those who find it difficult to restrain themselves from spending. If you’re a highly disciplined person, this recommendation may not necessarily resonate with you.

no more spending April 18, 2008 at 2:59 am

Great post!
I love the term ‘frugal capitalist’

Shaun Rosenberg April 19, 2008 at 10:09 am

Great post.

Everyone should take control of their finances. With social security going under people really need to focus on getting a 2nd income.

The Bargain Shopper Lady April 20, 2008 at 3:44 am

Great post! We are moving to the North East so it is a great way to learn not to buy things we don’t need! Another way I avoid spending is to blog about the deal. Sometimes that takes care of the rush of the great bargain that I don’t really need!

Serendipity April 24, 2008 at 11:27 am

I really appreciate the list of vices. Usually alcohol, coffee, and tobbacco are only considered. I’m not going to give up on wine and beer, but I can certainly cut out car washes and manicures. Vice is relative term, and I’m glad your post reflected this.

And I have to agree 100 percent with Emily (#3). Watching TV with commercial interruptions becomes totally unacceptable after watching via DVD or DVR. Commercials don’t just chip at your willpower, they actively destroy your entertainment.

taylor June 18, 2008 at 9:46 pm

Great I will give this to my mom! lol

Dana June 22, 2008 at 7:52 pm

Couple of thoughts about the credit card thing:

1. Having a credit card and rarely or never using it helps your FICO score, which costs you less in insurance premiums. Someone discovered that people with low credit scores tended to cost insurance companies more money, and ever since, the companies check your FICO. Considering we’re legally required to hold some forms of insurance such as automobile and mortgage, this could be a problem. So taking steps to keep your FICO higher are a good thing.

2. Also, credit cards enjoy better federal regulation than debit cards do. So if you have SMALL recurring expenses that you would normally put on a debit card… don’t. Use a credit card if you have one. Then pay it off in full each month. There’s your good debt repayment pattern that also raises your FICO.

And to the commenter who said cash isn’t convenient enough: That’s just the point. 🙂

Dana June 22, 2008 at 7:54 pm

Hm, and here’s another one: A car wash makes better use of water and recycles its runoff, whereas washing your car at home means more pollution of waterways by the soap that runs off your vehicle. Runoff pollution is a huge problem on private residential properties, especially in the suburbs, so whatever steps you can take to reduce that are a smart idea. Look at it this way: you can prevent the pollution at the source and spend a little more money to wash your car, or you can “save your money” from the car wash only to lose it to taxes to clean up your mess in the waterways later.

miro marian September 3, 2008 at 12:03 am

I want to become the second one , someone who enjoys pursuing money-making ventures and who focuses on income generation.

Naranja February 11, 2009 at 2:11 pm

I have to do that too. If I want something I really have to sit there and think about it for a while and make sure it’s something I need and not just want.

Avery Parker February 15, 2009 at 12:17 pm

Regarding credit cards – I think in essence they’re fine as long as you are able to pay your balance each month. However, studies do show that if you go into a grocery with a bundle of cash to spend versus if you go in with a credit/(or even debit) card you are likely to spend MORE on the plastic. I think part of it is perception. You know exactly how much cash you have in your wallet, but the credit has a high limit so I guess you could get one extra….

I think it’s also important to distinguish needs and wants.

james February 23, 2011 at 11:02 am

Just by cutting out Starbucks and quitting smoking I’ve been able to save a couple of thousand dollars in the last year. Slowly I’m embracing more of your tips here on your blog. Thanks again for all the great tips.

David Sneen July 19, 2011 at 8:27 pm

Great tips, timely advice! … I never thought it could be fun to be a frugalist!

Lucy July 29, 2011 at 10:29 am

Great post!… I am really 100% with you.. If only we learn to spend less than what we earn, then life would be easier for all of us. For extra tips on how to live frugally check learntoliveonless.com up.

Susan January 31, 2012 at 9:08 am

What gets on my nerves is how there are people who continue to whine about their lack of money but then it turns out that they’ve been spending quite a storm. Why do people complain about being broke but you happen to own 2 cars, lots of designer clothes and eat gourmet food? People living large are notorious for blaming everyone but themselves when their paychecks are garnished by the IRS. The lack of accountability is ridiculous. Pay what you owe, folks, and don’t blame anyone but yourself!

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