Frugalism: With minimalism for financial freedom!

Frugalism: With minimalism for financial freedom!

frugalism, a philosophy of life that is characterized by the idea of achieving maximum savings with minimal expenses is becoming increasingly important. The term comes from the Latin "Frugalis", which means "simple and modest". This saving movement, which was created in the USA with the Fire movement ("Financial Independence, Retire Early") during the 2008 financial crisis, has now also established itself in Germany. Followers of frugalism strive to be financially independent at an early stage by drastically reducing their expenses and saving a large part of their income, often up to 70%, as reported by ZDF.

In order to achieve this goal, frugalists, according to MDR information, must fundamentally change their way of life. You measure every cent and avoid unnecessary consumption. Investments play an important role in stocks, real estate or risky systems such as cryptocurrencies in order to grow the savings even more effective. However, financial experts warn of the risks: Higher income is often associated with more uncertainties in the investment. However, in order to secure the desired standard of living in retirement, it is crucial to develop a sophisticated financial strategy at an early stage, which also takes into account the amount of future pension payments.

Financial independence vs. reality of life

The idea of frugalism can be a challenge for many. While some people are quite able to save large parts of their income, this is not easily possible for the majority. This applies in particular to households with children, where the urge to save often meets the needs of the family. Financial expert Ralf Scherfling from the North Rhine-Westphalia Consumer Center emphasizes that the waiver of consumption alone is not sufficient: "The feasibility also depends on the amount of income and the achievable net return." The path to financial independence through frugalism may seem tempting, but reality shows that not everyone is ready or able to conduct this strict lifestyle.