You’re looking at a total penny pinching pro. I have tons of frugal living tips because I’m the master of cheap! 

It doesn’t always pay to spend less, though, as counter-intuitive as that may sound. A frugal lifestyle may cut your upfront costs, but it could cost you more money in the long run. 

And that is the absolute opposite of frugality. 

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Money Saving Mistakes & Frugal Living Tips

There are times when penny pinching can totally backfire.  Here are 9 ways that being frugal may not be beneficial:

1. 50% off is not always a great deal

I love hitting up the clearance racks at department stores. It feels awesome to score a great deal!

That euphoric feeling is why bargain hunting is addictive. Unfortunately, if you don’t really need what you purchase, you’re spending money on useless items.

A friend of mine got really into couponing, and was so proud to show me a huge stockpile of stuff she’d gotten for really great prices. She then freely admitted that she wouldn’t use half of what she’d purchased, but planned to donate her unused items to charity.

While donating to charity is wonderful, I wonder if she ever added up how much she spent (both in time and money) on all the items she knew she’d never use. I have to admit, though, that I’ve made the same mistake.

Several years ago Groupon had a 50% off sale on their already discounted deals. I was so excited about it that I bought a bunch of them. I’m usually really organized and keep track of expiration dates and terms, so I totally thought I’d use them all.

I didn’t. Not the best way to live frugally! I was so sad to have to throw away those expired Groupons for pizza and the arcade and ice skating and the aquarium. Instead of saving over 50% on all of those admissions, I wasted that money.

Now, I only purchase one Groupon at a time, and I actually plan a date to use it and I add it to my calendar. One of my best frugal living tips is to only purchase coupon deals when you already have a plan in place to use it.

2. Trading valuable time for meager savings

In your ongoing quest to pinch pennies, you consistently make your own bread, cook from scratch, hang your laundry outside to dry, make your own laundry detergent, clip coupons, sew and mend and build and fix. It’s like a full time job!

But does it pay you like a full-time job would?

Living frugally is wonderful if you enjoy these tasks, or if there are additional benefits such as better nutrition. But if you’re doing them just to save and manage money, there are better ways you could use your time.

As a master of frugality, I know all about this. My husband and I married while still in college and started our family right away. We had two kids in two years and lived as a family of four on under $10k a year, while paying tuition. 

If I’d gotten a job, I would have made less than childcare cost. I wanted to be the one to raise my children, so I raised penny-pinching to an art form. I quickly became a pro at living frugally and accumulated all of these tips!

I did all of the above tasks and more, and it paid off. I was able to be a SAHM in an almost impossible situation.

But now that there’s a little wiggle room in our budget, I have the luxury of determining which penny pinching habits actually pay off. I still cook from scratch for the health benefits as well as the savings.

But I don’t sew as much as I used to. When I can find a beautiful dress for my daughter’s concert on Amazon for $25, and fabric and notions would cost me $23, plus my time, I’m all about buying that dress!

The choice is yours, but I suggest you conduct a cost-benefit analysis to determine whether the hours spent on all of your penny pinching habits are worth the savings. Figure out how much the work you put in saves in dollars and divide that by the number of hours you spend. Then compare that amount to what you could earn elsewhere.

Be sure to take into consideration the side benefits of each of the activities (food made from scratch is more nutritious, but does homemade laundry detergent actually clean better?) and whether or not you enjoy them. 

3. Skimping on insurance

If you’re thinking about how to be frugal, insurance is not the place to save. I understand wanting to keep insurance premiums as low as possible, but if something catastrophic happens, not having enough insurance can absolutely bury you in debt. 

If you decide to carry the bare minimum level of auto insurance your state allows, and you get in an accident, you could end up paying out-of-pocket for your new vehicle and the other driver’s new vehicle, plus all of the associated medical costs, which could be astronomical.

Can you afford that? Is it worth saving a few bucks?

Cheaper health insurance plans come with a high deductible, too, so you end up paying for doctor visits and prescriptions out of pocket. You may actually end up spending more on a cheaper health insurance plan than you would have spent purchasing the pricier plan in the first place.

If you decide to increase your deductibles, make sure you have enough money in your emergency fund to cover the costs before insurance kicks in.

Our main floor powder room had toilet issues about two years ago. Every once in a while the flapper wouldn’t close all the way and the toilet water would run and run until you opened the tank and manually adjusted the flapper.

When we purchased this 20-year-old home, we learned that it had multiple issues (I’m talking MULTIPLE in all caps!) and we were getting to them one by one. The powder room toilet was something like #96 on the list.

So we hadn’t gotten around to it yet when one night, right before bedtime one of the kids flushed something they shouldn’t have at the same time the flapper stuck open. We woke up the next morning to a flood of toilet water all through the main floor.

Toilet water! Complete with bits of soggy toilet paper and other floaties!

Luckily, we have fantastic homeowner’s insurance, and they took care of the whole thing, from cleanup to restoration!

But, gah! We immediately replaced all of the upstairs toilets that also seemed to have sticky flappers.

Whether we’re talking about health insurance, auto insurance, homeowners insurance, or any other kind of insurance, make sure that you’re not trying to save a couple of bucks now just to get stuck with hundreds of thousands of dollars in bills later.

4. Buying cheap products

When we were young, newlywed college students living on under $10k a year, we had no choice but to purchase cheap furniture. Our biggest splurge was the cheap $100 mattress we bought at a discount mattress store.

We sat on plastic lawn chairs and ate at a glass patio table for years. Our bookcase was literally made of glued-up sawdust with a cardboard back. We made do and it worked.

But when we moved into our first house, we had nothing, because three years of daily use completely did that mattress in, the plastic lawn chairs had long since cracked into pieces, and let’s not even talk about that bookcase. So we had to start over.

That’s what buying cheap will get you! Cheap products are not usually durable, and they also look terrible while they’re falling apart. If you spend money on better quality products, you’ll save money in the long run. 

5. Spending dollars to save pennies

Just yesterday I had this conversation with my children. On the way to an orchestra rehearsal, I stopped to buy gas and paid slightly more than I would have at a gas station a couple of miles away. My kids demanded an explanation. (I’ve converted them to my frugal ways!)

So we had a long conversation, complete with phone calculators, about how it would have cost more money and time to drive to the other gas station than we would have saved. It would not have been a good deal in the long run.

This is one of my most important tips for frugal living. Going out of your way for a deal can cost you money. It’s the antithesis of penny pinching, and it will not help you meet your financial goals.

Maybe kids eat free at a restaurant in the city, but a closer restaurant has free parking and will cost you less in gas. Maybe IKEA has great prices in their food court, but you can never seem to get out of there without spending money on stuff you don’t need.

When you’re looking for a bargain, calculate the total cost. Along with the item’s price, include the shipping cost if you’re buying online or the cost of gas and parking if you have to drive.

6. Neglecting routine maintenance

An ounce of prevention is worth a pound of cure. Likewise, a few pennies in maintenance can save you lots of dollars in repairs.

Remember the toilet flood I talked about earlier? How I wish we had just replaced that toilet flapper when we first realized it was sticking open.

At ~$50 per oil change, three times a year, you’ll spend about $150 each year on engine maintenance. Or you can skip oil changes and replace your engine every few years to the tune of about $5k.

The same goes for biannual dental checkups, yearly physicals, replacing window and door seals, and fixing clogged or leaking pipes. Taking care of yourself and your possessions is one of those frugal living tips you can’t live without!

7. Assuming DIY will always save you money

Hey, I’m always up for some DIY! Not only do I love saving money by doing things myself, I love actually enjoy doing them! But I’ll be the first to admit that penny pinching DIY’s won’t always save you money.

Since we’ve completely remodeled our last three homes, we have all the tools. From the table saw to the tile saw, tools are a huge expense that you have to pay upfront.

We definitely get our money’s worth out of our tools in the long run, but you might not unless you DIY frequently. You could just rent tools, but then you’d have to factor those rentals into the cost of your project.

Another way DIYing can cost you a ton is when you do something wrong. I wanted to remove a good portion of a load bearing wall in my basement. I knew I needed to redistribute the load, but I wasn’t sure exactly what size header I should use, nor how many trimmer and king studs I needed to sandwich to carry the header.

Luckily, my dad knew. And he also helped me to lift that beefy new header into place once we had pulled back the drywall, moved the electrical and hvac, and temporarily supported the load.

Imagine if I had tried something like that without any previous construction experience, knowledge or skills? The entire house could have fallen in and repairs would have been very expensive.

DIY can also be dangerous at times. A few years ago our neighbor fell off his roof while he was working on something up there. He was in the hospital for a couple of weeks and surely had a gigantic bill to pay. In the long run, it would have been much cheaper for him to hire the work out.

8. Buying in bulk at membership warehouses

99 granola bars for $13? Yes, please. Five pounds of Red Vines for $10? Sign me up!

While there are surely lots of amazing deals at your local warehouse grocery store, it’s easy to buy things you wouldn’t normally buy.  This is one of those frugal living tips that can cause you to spend more than you realize.

According to the Journal of Marketing Research, households that shop at club warehouses spend on average $11 more per month on packaged food than those that don’t.

We only had a Costco membership for one year, because I realized that I was spending more when I shopped there. All of those packaged goods were so tempting, and I had previously never purchased them. The only thing I’ve missed is the discounted gas.

Even when I shopped at Costco, I rarely bought produce there. We eat a lot as a family of ten, but even I knew we’d never manage the ten pound tub of strawberries before it went bad. I knew I’d be throwing out fuzzy strawberries all week.

Americans waste about a pound of food per day, with perishable items like dairy, breads, meats, fruits, and vegetables leading the way.

But you can’t waste what you don’t buy in the first place!

If you could see my basement food storage room, you’d laugh about me warning people about buying in bulk. I buy all of our legumes and grains in 50 lb bags, which we disperse into 6 gallon plastic buckets for longer storage.

We save a lot of money by purchasing those items in bulk, and I love that we have food stored away in case of an emergency. It also helps me to shop less often, which saves me money.

Want to save money on groceries with more frugal living tips?? Get my secrets for cutting your grocery budget in half!

Grains and legumes have a long shelf life, though, so they make total sense to store that way. So do canned goods and nonperishable items like trash sacks, toilet paper, cleaning supplies, toothpaste and toilet paper. But that obviously isn’t the case for perishable food items.

Maybe you should think twice about renewing your membership when it rolls around.

9. Not looking for additional savings

In this day and age of technology, you have no excuse for paying full price. Coupon sites and rebate apps abound to help you find the very best price for pretty much every purchase you make.

I have a couple of favorites cash backs that I use regularly, so if one doesn’t offer cash back at a certain retailer, another will. These are terrific penny pinching tools!

One of my favorites is Ibotta a free app that allows users to easily earn cash back on purchases made both in-store and online. It’s the third most used shopping app, right behind Amazon and Ebay. Ibotta users receive cash back on products and services from both online and in-store retailers.

After you register, you select your favorite stores and retailers. These can be edited at any time. When you click on a store, you will see items that are currently eligible for cash back offers. Tap the offers you want to redeem, then take a picture of your receipt. The money is then added to your account. It’s that easy!

Ibotta almost always has ‘any brand’ offers on common items, so in most cases you will be able to find something you can earn cash back on, even when you don’t plan ahead. Usually you will have about a week to scan your receipt.

Get a $10 bonus just for signing up with Ibotta through this link.

You’ll see your first $10 bonus after your first purchase. Next time you’re running errands, open the app and tap the items you will be purchasing. It’s so easy! Once you earn $20 or more, you can transfer the money to your bank account via PayPal or Venmo. It won’t take you long to get to $20 – I made over $40 my first month!

Rakuten is another cashback website I love. It offers different products and partnerships from Ibotta. Between these two apps, you can save money on pretty much everything you buy, whether online or in a brick and mortar store!

Get a $10 bonus just for signing up with Rakuten through this link.

You can also earn money back with credit card rewards. Be selective with your credit cards and find ones that offer cash back or gift cards as rewards. 

Frugal Living Tips: My Final Thoughts on Penny Pinching

If you want to learn how to live frugal, look at the big picture. Consider not only how much you’ll spend right now, but how much you’ll spend, in both money and time, over the long term. Now that’s wise penny pinching!

There are also ways to save money on high-quality items that we haven’t talked about, like purchasing from estate sales or thrift stores. We purchased our first piano, an upright Yamaha, from Salvation Army for only $700.

What a bargain, since that piano has been played multiple times daily for the last 15 years!

Another one of my best frugal living tips is to just buy less stuff. When you’re tempted to make a purchase, just walk away and mull it over for a day.

If you still want or need the item after a day and are willing to go back for it — do it. But you’ll probably find that you don’t need all the stuff that you think you do.

Americans are drowning in debt because they’re drowning in stuff. If you don’t believe me, count up all the storage units in your city. It’s ridiculous!

Have any of these frugal living tips cost you money? I’d love to hear about your penny pinching experiences in the comments below!

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