Tuesday, November 1, 2011

Traits of a Tightwad- Responsibility

You know what personality trait is pretty much essential to living as frugal a lifestyle as possible?
Responsibility. Being a responsible person who takes responsibility for his or her actions, and living a responsible lifestyle makes your attempts at frugality all that much more effective. Irresponsibility, on the other hand... now that can really come back to bite you and really hurt you financially.

How do responsibility and frugality coincide?
To demonstrate that, let me start off with a story that unfortunately is true that someone I know told me.

This person, lets call him A, got a cell phone when he was 18 years old. Now, A for whatever reason (probably because he was an irresponsible 18 year old) didn't pay his bill one month, and because of that, his cell phone service was suspended.
Ok, thought A, I guess the consequence of not paying that bill is no more phone line. I can deal with that.  A quickly forgot about that bill, and assumed that if his line was cut off, his bill was forgiven. Or something like that. But for whatever reason (by now lost in the annals of history), A decided not to pay that bill.
His phone had no service, but A was on a contract with his phone, so even though he had no phone line anymore, each month a new bill arrived in the mail, charging him for that month's service.
This infuriated A. Why should he have to pay for a service he never received, namely, a working phone? His phone line was cut off ! They had no right to charge him for that, he thought.
He paid up that one month's bill he owed from the beginning, but paid no more.
A moved from one home to another, and he stopped getting those bills in the mail for the cell phone service he didn't have. And stupidly assumed that that was the end of the story, and promptly forgot about it after that.

4 years later, A was now married and starting to raise a family in a new city. One day a courier arrived at his front door with a court summons. A was being sued for $750 for his long overdue bill. His wife, of course, was none too pleased. A had never mentioned this overdue bill of his (originally $125, but now, years later, with all the added fees and interest, much much more than that!) and this was the first A's wife had ever heard of it, and now they were expected to fork over $750 for this old bill of his from years before?
A called up the lawyer representing the phone company whose number was listed on the court summons, trying to ask if it was possible to reach a compromise, to pay part of those $750, but not the whole thing, somewhere between the cost of the original overdue bill and the amount the cell phone company was now demanding. Not only did the cell phone company refuse to compromise, but the fact that A called their lawyer meant that now the cell phone company tacked on yet another $250 to the bill, because of "lawyer fees".
A's wife drove down to the company offices and tearfully tried to compromise with them, but there was nothing happening with the now $1000 dollar phone bill. Possibly A and his wife could have involved a lawyer of their own, but they had no money with which to pay a lawyer, so they consented to pay that $1000... and that was the beginning of their financial struggles as a couple.

What is the point of this story?
Responsibility is key.
If 18 year old A had just taken the responsibility and paid his first bill on time, he would have saved himself and his wife that massive $1000 bill down the line. Irresponsibility cost him an extra $875! Ouch!

Responsibility, the key to true frugality.

When someone is frugal, it means that they're taking responsibility for what happens in their bank account. They're not blaming everyone left and right for their financial state. They realize that what happens, the money they spend and the money they save is all their doing. Responsibility.
People who budget are acting responsibility. People who spend without thinking about the consequences of their actions? Now that's truly irresponsibility.

Ok, that's obvious.

But what about the other ways that irresponsibility harms your attempts at frugality?

I must admit that I may often make myself out to be Mrs Frugal Queen, so financially responsible that I never make any frugal mistakes, but I am far from perfect financially. In fact, my biggest financial blunders come due to my lack of responsibility. Yes, responsibility is something I struggle with and am attempting to improve, but in the meantime, it certainly has cost us money.

Like when I forget to pay bills until we get a warning that if we don't pay within the next 48 hours, our service will be cut off... and of course, we end up paying interest on those bills.
(Which is why even though I know about reward points I could potentially earn with credit cards, I would never trust myself enough to get a credit card and risk missing a payment as I know my scatterbrained self is likely to do.)
There's a reason I do automatic bill payments for as many things as possible!

Other ways that irresponsibility costs money?

  • Forgetting wet clothing in the washing machine, or just being too lazy to hang it up, so that it either stinks and needs to be washed again (waste of water, electricity, and detergent), or leaving it so long so that it actually molds or sheds color and is permanently ruined.
  • Forgetting to take laundry in from the laundry line and leaving it outside too long so that it fades in the sun and gets ruined, or stays in the rain and needs to get rewashed.
  • Forgetting to treat a stain on clothing immediately so the stain actually sets and the clothing is ruined.
  • Forgetting to put away some food in the refrigerator, and having it get spoiled.
  • Forgetting that you have certain foods in the back of your refrigerator until they start molding and stinking.
  • Buying food with the intention of preserving it, and then never getting around to doing so, so that the large quantities of food you intended on using to feed your family for a while all ends up in the trash once it rots or molds or spoils...
  • Misplacing an important item and then needing to spend a lot of money to replace it.
  • Behaving irresponsibly with a piece of technology like a cell phone, like dropping it and stepping on it, or putting it in the washing machine, or sticking a knife into your running food processor, and needing to replace the expensive equipment after your actions caused it to break.
  • Purchasing a groupon type coupon for discounted groceries at your local grocery store... and then forgetting to use it before it expires...
Wow... this list can just go on and on.

Hey- who you looking at? Who said I was talking about myself? I was just giving examples...
Ok, fine. I'll admit it. I've done all the above. Numerous times each. Its embarrassing.

Totally necessary to be as frugal as possible.
Unfortunately, responsibility is one area in which I still need to work.

Ok, now lets hear other people's confessions. What irresponsible things did you do that cost you money? Please tell me I'm not the only one who makes these mistakes. Repeatedly. Please? (You can lie to make me feel better, I allow that.)
In general, are you responsible or irresponsible?
I'm not 100% irresponsible per se, more scatterbrained and a procrastinator... which are just 2 subsets of irresponsibility, but I certainly am responsible in other areas. 

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