Book review: The Cheapskate Next Door
Every Sunday, The Simple Dollar reviews a personal finance book or other book of interest.
A few years ago, I reviewed Jeff Yeager’s excellent book on frugality The Ultimate Cheapskate’s Road Map to True Riches. Quite simply, it was one of the best books on frugality I’ve ever read, with a healthy dose of humor and a lot of useful tips.Skip to next paragraph
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His follow-up, The Cheapskate Next Door, appeared on bookshelves earlier this year and I was quite happy when I was able to pick this one up from the library, given how much I enjoyed Yeager’s first book.
This new book involves Yeager interviewing other “cheapskates” and discussing some of the tactics that others use to practice frugality in their own lives. He also draws some general conclusions about frugality that are based upon these interviews.
Sound interesting? Let’s dig in a little deeper.
1 | The Phrenology of Frugality
Yeager opens the book by defining sixteen key features that define a “cheapskate mindset.” I find most of them quite agreeable, particularly “a cheapskate values time more than money” and “shopping isn’t a cheapskate sport.” In fact, I would define these traits as being more about being thoughtful about your money than being a “cheapskate.” In fact, in my eyes, Yeager often uses the word “cheapskate” when I would use the word “frugal” – the only time he seems to veer into what I would call being a cheapskate is when he is obviously joking or being sarcastic.
2 | Good Habits Are Hard to Break
Here, Yeager discusses the perniciousness of habits that result in the spending of excess money. Everything from shopping as a hobby to buying coffee and gadgets and books falls under this umbrella. His best tactic for eliminating such bad habits? Choose your friends carefully. You often mirror your friends in a lot of ways, so if your friends engage in financially poor habits, you vastly increase the odds that you’ll engage in them, too.
3 | Money Management, Cheapskate Style
Spending less than your age? The idea here seems a little strange, but it’s actually pretty sound. The entire point is that the younger you are, the lower your salary is likely to be, and thus the lower your spending should be. Many people don’t do this and instead bank on higher earnings in their future, taking out massive loans and living a lifestyle beyond their actual income. Of course, eventually the chickens come home to roost and you find yourself in middle age with a gigantic stack of debt bills and no hope of freedom. Instead, live lean while you’re young and you’ll find that middle age affords you more money than you’ll know what to do with.
4 | The Oxygen Mask Approach to Raising Kids
“Gratification is a dish best prepared in a Crock Pot: nice and slow.” I particularly like this quote’s applications to raising children. The lessons you teach a child aren’t taught in a day. Instead, they’re built up slowly over time, and you as a practitioner of frugality are a good example of that. If you make meals at home every night (or almost every night), your children will come to see this as the normal. If you spend with reckless abandon, your kids wlll see this as normal and come to adopt it as their own behavior.
5 | Thrift: The Greenest Shade of Green
Yeager makes the case here that many frugal tactics are also green tactics – they help the environment as well as your pocketbook. I can certainly say from my own experience this is true. A big part of frugality is buying less stuff (meaning less stuff thrown away) and reusing what you have, like