Meet the Frugals: Why I Don’t Care About Upsizing

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immune to upsizingForget McMansions, SUVs and wall-sized flat-screen TVs. That’s so last decade.

It’s no secret that the economic ups and downs of the past few years have made many of us rethink our finances—not to mention our lifestyle choices.

Gone are the days of buying bigger and better. In fact, since the financial crisis hit, more Americans have been paying off credit cards, shopping at thrift stores and purchasing smaller cars. Plus, based on census data, the median size of a new home in the U.S. shrunk by nearly 5% to 2,169 square feet between 2007 and 2010.

And it seems that austerity is here to stay: According to a Deloitte’s 2013 American Pantry Study, 94% of consumers said that, even if the economy improves, they plan to remain cautious and keep their spending at current levels. “Frugal attitudes and behaviors have endured,” noted the study’s authors. “The impact of the recession lingers, and resourcefulness lives on.”

This stalwart frugalness is reflected in the latest data on consumption: Sure, consumer spending has risen 9% since the end of the Great Recession—but that gain is less than half the average rise in consumption compared to previous economic recoveries.

“People are rightsizing their relationship to debt following the global financial crisis,” says Bruce Piasecki, a management consultant and author of “Doing More With Less: The New Way to Wealth.” In fact, he forecasts that a sizable chunk of consumers will take the lessons learned during the recent recession with them for a lifetime.

So who are these people who are actively spending less and buying small—folks who are essentially shunning the desire to upsize? We tracked down people in their twenties, thirties and forties who profess that they aren’t swayed by the “Keeping up with the Joneses” effect to find out how—and why—they prefer to embrace the less material life.

demarcoFrugal in My Thirties

The high cost of living in New York City made Michael DeMarco, 37, question his lifestyle. “At some point, I was working three jobs just so that I could afford to live in New York, and I decided that enough was enough,” DeMarco says. “I quit my jobs, moved to a cabin in the woods—and began to downsize.”

RELATED: How I Did It: Shrunk My Life to 128 Square Feet

  • Michelle

    Buying a home before you can afford a downpayment IS upsizing.

    • Kelly

      I agree. And I find it irritating when stories are highlighted that have parents seriously helping out their kids. That’s not frugal; it’s privilaged.

      • Shannon

        Agreed!

        • Marcela

          Agreed as well, promoting parenthood support for downsize spending isn’t frugal at all.

  • Matthew Gordon

    Great article! I think the sentiments here are shared among many Millennials and Gen X-ers, even if buying a home in DC at 29 isn’t.

    Michael Hess’s decision to bike to work is also great exercise, and three miles isn’t bad at all for distance.

    My family has recently been unloading all kinds of junk. Having moved around a lot, I’ve really lost the desire for any material item I don’t either use regularly or sock in one of my bookshelves.

  • Maureen

    It does dissappoint me that so many of these articles focus on improving your financial situation by relying on supportive family members giving huge loans, sharing their homes, and other helpful things. Many people don’t have such support available to them, myself included. As someone with over 100,000 of student loan debt, I often start these articles excited and end them feeling more depressed. If I could move in with someone I would…I’d like to see some articles that focus on really, truly tackling your debt as a single woman. That includes not using mommy and daddy as a bank/lender/landlord.

    • Deb Kelly

      Maureen, I don’t think this is realistic for many people. Huge loans (gifts) from parents. Keep your head up high as I am sure that you will eventually get that student loan paid off. I found that a room mate helped a lot when I was in college – that might be helpful to you as well.

    • SO

      It’s also helpful to remember that moving in with a friend or relative is not usually cost-free! Rent and utilities may be shared and below market value for the area, but “hosts” often struggle themselves.

    • Tania

      So, try to take away the bits that could apply to you. The first story talked about downsizing/moving to a more affordable location and as far as the third story, she also spoke about picking up extra income by working extra shifts. If extra shifts don’t apply to you, try to turn it around and be creative with your own situation. Is there any way you can make extra money by having a side job (what skills do you have that may be marketable, I do bookkeeping on the side and I have friends who work catering at special events on the weekends to pick up some extra cash, others make jewelry)? Is there any items you could sell? Can you rent out part of your home or get a roommate? Do you have a car and do you need it or could you live with public transportation or does your city have transportation share, only renting a car as needed? Please don’t respond to me with why you can’t do any of these things as my point is not to give you specific tips but to stress the more you look to find an article or personal story that you can relate to 100%, you will continue to be disappointed. Try to read personal stories with a new eye, a half glass full approach. Be creative with how they did things and how you could apply to your own life (in your own way, what will fit for you, not so literal).

    • lisainlouisiana

      Hi Maureen, I did that as a single woman (widowed), you can see a lot of the stories at moneyinreallife dot com. I sold the 2500 sq foot McMansion, am down to 687 sq feet now, took Jackson Hewitt Tax class, and am now at 6 figures net worth. You CAN do it!

  • Jen

    LV, “tack,” not “tact.”

  • Tania

    In my culture (third generation Hawaii Japanese), multi generational living is not considered a handout from the parents (or from the children) as the generations will share the expenses. The reason for it is not purely financial although just a regular home here can run you four times as much as certain areas on the mainland but it also has to do with caring for aging parents and enjoying time with our family before the older generation passes. Rather than viewing this story as useless because she had help from her family, I view it as a possibly thinking outside the box for those who could never fathom or would ridicule living multi generational before now. The girl in the third story paid off her student loans in four years. Yes, she had help from her parents but she also had to make some sacrifies and work hard to do so. If living multi generational is not an option, than her story also indicated she took on extra hours and rents part of her home out. There are still lessons to be learned from her story.

  • Maggie@SquarePennies

    Many of us have downsized our lifestyle and have discovered we like it better. When you choose your priorities and stop spending on things you don’t really care about, life is more fulfilling. This works no matter what age you are!

  • CrankyFranky

    was chatting with a friend recently – she was saying her mom’s relatives were very stingy, all about using coupons for everything – yet now they were rich – while she was struggling to pay the bills

    I gave her my usual millionaire-next-door rave – most millionaires drive older cars (I’m in that category and drive a 22yo Honda Civic) – most people driving shiny new cars are not millionaires – she nodded her head – and I suddenly realised – she had recently bought a new car – oops !