15 Ways to Live Like a Cheapskate and Retire in Style

Category: Financial and taxes in retirement

February 26, 2013 — If you search on the Internet for “live like a cheapskate” you will strike a frugality bonanza. There are authors like Jeff Yeager who have written best sellers on the subject (“The Cheapskate Next Door”), plus plenty of websites offering their advice. There’s even a TLC show, “Extreme Cheapskates“. Our friend Robert Powell over at MarketWatch had a particularly helpful article earlier this year, “How to Retire Like a Cheapskate and Live Well“. This article will roll up advice from all over into our 15 top tips for living like a cheapskate.

First of all, a little etymology – if you are going to be a cheapskate you might as well understand where the term came from. In fact there is considerable uncertainty about the origin of the word. The main dictionary sites seem to think that “skate” was a late 19th century slangy term for a worn-out horse, to which cheap was added to imply mean or miserly. One Wiki source claims it refers to inexpensive strap-on roller skates; while we acknowledge those were horrible to skate on, we doubt that is the term’s origin.

A Penny Saved…
Benjamin Franklin had it right – a penny saved is one you don’t have to earn. For retirement that means if you can manage to save enough money on your expenses, you can survive – and maybe have enough to indulge in a few luxuries.

Our Top 15 Cheapskate Ideas
Here are some of the best ideas we have heard for saving money in retirement. Our advice is to think about the big things – steps you can take that can deliver serious money. Yes, you can re-use your dental floss and your paper and plastic bags, and you can hard boil your eggs as you run the dishwasher. But some of the steps that extreme cheapskates will do to save a few pennies seem a bit crazy – as in taking the idea so far you get obsessed about it. Here goes:

Move to a smaller house. Real pennypinchers don’t wast money heating/cooling, painting, maintaining, and paying taxes on a house that’s bigger than their needs.
Buy a reliable car, preferably second hand. Buy a basic model, and keep it until big things start breaking on it. If you have 2 cars – get rid of the gas hog.
Move to a less expensive state. Hopefully one with reasonable real estate costs along with lower income and property taxes.
Plan your major purchases in advance. Leo Babauta, author of several books including The Cheapskate Guide) suggests keeping a 30 day list – don’t buy anything until it has been on your list for 30 days. That way you avoid impulse buying, and you have the time to take advantage of deals.
Buy only with cash. People get themselves into the most trouble with credit card-backed, sudden urge purchases. Having to pass over a wad of $50 bills has a powerful way of promoting restraint.
Use cash and get discounts. Retailers hate paying credit card fees out of what they get from a sale. So offer cash; many times you’ll get a discount – if you ask.
Take all available discounts. If you travel, get an AAA card. You’ll usually save 15% on motels. Senior discounts are about everywhere – ask if you don’t see them. If you live in a tourist area ask for the local discount – most places give them. Or, just ask – do you have any discounts – you’ll often be surprised.


Take advantage of free entertainment. Read the newspaper and online guides – you’ll be pleased with how many free (and good) events there are. Many museums have one day a week or month that’s free. Use your DVR to record your favorite TV shows and classic movies – just about every good movie gets on TV someday! Use your library; they have many free and great programs and resources ready for your pleasure.
Manage your communication expenses. Many of us are paying an astounding amount of fees every month for communication and the Internet. Cable TV, Internet access, home telephone, cell telephone, ipad Internet, Netflix, Sirius radio, and more. Most of these have become necessities, but the monthly totals can be amazing. Consider consolidating (get rid of the land line, get a family cell plan, put phone/cable/internet with same supplier). Cancel your cable and watch TV online. Talk on Skype or Facetime. You should be able to be cut something.
Stay healthy. Co-pays, drugs, and other out of pocket expenses can actually drive you into bankruptcy. So save big bucks – get yourself into shape, cut down your vices, take your medicine, and generally take care of yourself.
Travel by bike – or walk. At $4 a gallon every car trip you take costs you money. We guarantee you will enjoy a short bike ride or walk a lot more, and it will be free!
Practice frugal gifting. Think ahead about what gifts you need to purchase in the coming year. Buy when they are on sale, or knit, draw, or build something more meaningful at a fraction of the cost. Last minute excursions to buy gifts almost always cost you more.
Cut smoking, alcohol, and sweets. Besides killing you, the price of a pack of cigarettes is obscene (remember when you could buy a carton for $3?). Cut down or stop your consumption of alcohol and sweets, both of which can turn out to be a pretty big (and unhealthy) part of your budget.
Maintain your stuff. You paid a lot of money for your car and household appliances. Read the manual and take the simple steps they outline to preserve their long life and cut down on repair bills.
Make more money. The corollary to saving money is to make more of it so you have it to spend. Looking for a paying job that is fun or rewarding can give you the wherewithal to have some extra spending fun in your life.

For further reference
The Cheapskate Guide: 50 Tips for Frugal Living

What are your best Cheapskate ideas? Come on now Topretirements members – we bet many of you have some outstanding ideas on how to save money to make the best of retirement. Please share them in the Comments section below.

Posted by Admin on February 26th, 2013

35 Comments »

  1. I have about 30 specific tips for saving money listed in my book. Here are three, briefly summarized:

    1. A number of generic drugs are free at places such as Walmart, Publix, or Meijer. You will still need a prescription from your doc, though.

    2. If you’re 62 or over, purchase a $10 Lifetime Senior Pass that gets you into more than 2,000 federal recreations sites, including National Parks, This is a perk a lot of people don’t know about. The pass covers the car passengers, too. (http://www.nps.gov/findapark/passes.htm)

    3. Do what my kids have done re phones – dump the landline and only use your cell phone. Before you cancel, be sure its cost isn’t bundled in a discounted package with TV or Internet service.

    Jan Cullinane, author, AARP’s The Single Woman’s Guide to Retirement (John Wiley & Sons)

    by Jan Cullinane — February 27, 2013

  2. One of the biggest money savers we have is couponing. My wife is like one of those people (almost) you see on TV on extreme couponing. She will usually save us 50 to 60 percent per trip to the grocery store. Most of the time she matches coupons with items on sale, often getting the items for FREE. We have also built up a significant amount of stores because we take advantage of good deals and stock up on low cost items. :grin:

    by Johnny Jacobs — February 27, 2013

  3. I take exception with your comment that alcohol can be a big and “unhealthy” part of your budget. Most data shows that alcohol in moderation can be very good for your health.

    by Ray Dinsmore — February 27, 2013

  4. I agree that couponing is great but I find unless I exercize restraint, it’s like being at an auction and I wind up buying items that I don’t regularly use because it’s on sale and I have a coupon! I guess I get caught up in the challenge. We do not drink bottled water and that saves a ton of money not to mention all that plastic and the petroleum needed to make it. We shop on days when there’s a senior discount offered at our groceries, department stores and movie theaters. We take advantage of restaurant deals such as Groupon and Restaurant.com when we eat out which isn’t more than twice a month unless it’s a special occasion. And contrary to the suggestion of paying with cash, we use one credit card for everything, pay it off monthly and use the points we accumulate for yearly travel. It works great if you have some ability to control your spending. I can understand the issue of not thinking of plastic as real money!

    by cherie — February 27, 2013

  5. For years I lived the cheapskate life. This helped me semi-retire at the age 40 when my net worth was minus $30,000. (I had no assets and had $30,000 in student loans.) Living the cheapskate way allowed me to save 30 to 50 percent of my income when I started making decent money.

    I can add many other ways to save money. Nonetheless, the one from the list of 15 that resonates with me is Number 15: “Make more money.”

    Now that I earn a better income than 90 percent of the population by still being semi-retired and only working 4 or 5 hours a day (like I always have), I take great pleasure in not having to live the cheapskate way. For example, I love flying Executive class, which I have done to Toronto, London, New York, and Istanbul. (As Cherie above, I use my Visa Aeroplan card to accumulate Aeroplan miles and always pay off my Visa bills at the end of the month.)

    Insofar as leaving money too heirs, these two quotations apply:

    “Leaving your heirs a lot of money doesn’t guarantee tears at your funeral.”
    — Sandra Block

    “If you want him to mourn, you had best leave him nothing.”
    — Martial

    In the end, there is only one purpose for money — and that it is to spend it. Of course, you must be creative and industrious enough to earn enough money to joyfully spend it in pleasurable ways.

    Ernie J. Zelinski
    Author –
    “Helping Adventurous Souls Live Prosperous and Free”
    Author of the Bestseller “How to Retire Happy, Wild, and Free”
    (Over 175,000 copies sold and published in 9 languages)

    by Ernie Zelinski — February 27, 2013

  6. Everyone is different. I follow strict health and fitness protocols but enjoy a glass of wine with dinner. Where I live it is as reasonable as any other type of beverage with dinner and is what I want. Cut up Credit cards? Really? People looking at these comments I would give more credit to than being that reckless with their spending. I always use credit cards for purchases when I can and have one for gasoline, one for meals (and wine) out, one for travel and one for everything else. The reason? I get 2% cash back on the one for everything else and 3% to 5% with the other cards in cash back.

    by High Yield Consultant — February 27, 2013

  7. As High Yield Consultant said, everyone is different. Reading some of the ways to save are a combination of common sense and “you’ve got to be kidding”.

    My biggest expense is the maintenance on my house. Every year I have had to replace something major like roof, flooring, appliance (s), heating and air system and have the foundation raised and leveled due to dry and shifting ground 3 times. I am so looking forward to selling and moving into a senior complex. Having to shell out $10K to $20K annually just to maintain is no fun.

    We use credit cards for everything we can, pay them in full every month, and get the cash back which is used when we take a trip or cruise for “frivolous fun” stuff. We both work part-time to earn “fun money” so we can take the trips and cruises. We don’t drink or smoke. We do eat out a lot as we have found it is more economical FOR US as we use Groupons and coupons 90% of the time. If I buy groceries and cook, half ends up getting thrown out. On an average, we spend $20-$25 per meal out and it serves us for 2 or 3 meals as we never can eat a full meal. We no longer buy stuff for the house as when we sell, will be getting rid of a lot of what we have. We no longer buy clothes or shoes as we have more than enough.

    If you want to travel and enjoy life when you retire, you will find a way to do it. When I say this, it is assuming you are in relatively good health, as we are. I can’t comment on how it would be with health problems. I am 75 and he is 66 so we are not “young” retirees but are fortunate enough to be rather healthy.

    by Joanne Hice — February 27, 2013

  8. Two thoughts on how to save money:

    1.Entertain at home! People have gotten into the habit of eating out, often because they were too busy while managing a career to cook more than a simple meal. Now that you are retired and have more time,invite friends over for dinner and a game of Bananagrams, or another fun game. Most of your guests will ask, “What can I bring?” Take them up on the offer to share both the time it takes to prepare a meal and the costs. You’ll find that eating at home costs less, is fun to do, usually means tasty-left-overs, and generates return invitations.

    2. Stop going to Dunkin’ Donuts or Starbucks every day. Coffee is ridiculously easy to make at home. If you do the simple math, you find that a four-dollar-a-day coffee habit translates to $1460 a year!

    by Patricia Kennedy — February 28, 2013

  9. I notice that many of the people posting here are ‘making a case’ for the lifestyle choices they make, and explaining why it works for them. The suggestions above are suggestions that you can follow, or not. I don’t believe that eating out is ever cheaper than eating at home, but who cares? It’s your money. I think the important thing here is to offer ideas that some people may learn from, or be inspired by.

    by Ginger — February 28, 2013

  10. Since I retired I have cut my expenses by 50 % with out much change in my life-style.
    1. I watch every penny….now I don’t spend mindlessly.
    2. I shop for food and anything else once a month.
    3. I look for alternatives. For example, I take out ebooks from the library.
    4. I am in the process of creating a pet-care co-op so that I don’t have to spend money for
    my cats when I travel short-term.
    It is a rewarding challenge!

    by LuluM — March 1, 2013

  11. Lulu,
    how does that once a month food shopping work out for fresh foods? Are you doing that to save on gas or save on food?

    by Elaine — March 2, 2013

  12. I do live in one of the most expensive states in the country (Ct.) so it’s very difficult to be thrifty. I know that I’m spending less that I did while still working but I still find it very hard to be as frugal as I think I should be. Hard to get over the old habit of buying what you want when you want it as I could when I was still working.
    Should definitely move to less expensive state but because I am a widow + it’s scary to think of moving to a new location where you know no one. Yes, I can and would make new friends but what do you do in the meantime.?
    Two sons live in Huntsville, Al. We do have a good relationship and they have encouraged me to move there but I sure don’t care for that VERY humid climate. I do tend to be an outdoors person except when the temp reaches 90 and the humidity is about the same.

    by Anne — March 2, 2013

  13. I just retired and we are planning to sell our Arizona home and move to a more tax friendly state. Currently looking at Alabama and Tennessee. Tennessee does not have income tax but the property taxes can be high. Alabama does not tax defined retirement income but 401K distributions are taxable and after age 65 no state property taxes.
    Use your credit card to get cash back but always pay the balance when due. You use the money for up to a month free.
    Buy a well built vehicle and keep it. We own a 2002 Corolla we bought new, It now has 180,000 miles and gets up to 40 MPG. I maintain the car myself.

    by Just Retired — March 4, 2013

  14. We grow our own veggies in the summer, then can the surplus for winter.
    We heat with wood from free, downed trees.
    Hubby makes his own beer & wine, and we buy eggs & meat from a farmer down the road.
    No expensive fancy smart (or dumb) cell phones, but we do have internet connection. Landline phone only is much cheaper than your I phones. Come on people, we grew up without cell phones!
    Unfortunately, a big chunk of my money must be spent on expensive health insurance.
    Clothing? There is a Salvation Army store in a near-by city!
    But we do have money for travel, maybe once a year, and that makes up for all the chopping of wood, and long johns in the house…. just the thought of those white beaches & palm trees & blue water.

    by Marge — March 20, 2013

  15. Marge – At last! We have found another kindred couple!!! We do have cell phones … only for emergencies when on road … I used to have a 65 mile commute (each way) … through Appalachians in winter! They’re “dumb” Tracphones. If one economizes other ways, you can find funds often available for trips now and then, etc. I would still be using FREE dial-up access from our library … if wife hadn’t finally revolted (I would just it with a magazine, a book, or the paper as each page would load ;-) ). Heck, even dropped my beloved Netflix a while back for free DVDs from our library. Loved Netflix because they had all these great British TV series and films that I love. No cable or other regular TV. We love to bike and walk/hike together. Our comfort bikes (after years of trying to strain our necks on cheap mountain bikes) was one of the best investments we ever made … made bike riding a real joy (we ride flat rails-to-trails). Life can be so wonderful from just the simple pleasures.

    by Mad Monk — March 21, 2013

  16. Monk— Maybe we were Amish in our last lives……
    and maybe we will be Amish in our next lives!

    by Marge — March 21, 2013

  17. I and my husband are proud “cheapskate” (especially my husband; I am recent convert). We are not extremists (no, we don’t wash paper towel to reuse), but already done most of 50 tips. We still use credit cards (with rewards, and pay on-time), and use cell phones (hubby has pay-as-you-go for emergency, I have smart phone $25 month unlimited date plan without contract). An only concern for us is health insurance because of my husband’s diabetes. Right now, we are semi-retired and getting insurance through my husband’s job and soon he wants to fully-retried. He is too young for Medicare yet. (He is 60 now). We are already using Wal-Mart for drugs. Does anyone have any suggestions? Do you think Obama care will help us?

    by Francesca from NY — March 22, 2013

  18. Francesca from NY, you might look into Jans Drugs in Canada, from my understanding some people save over a few thousand a year.

    by CB — March 22, 2013

  19. people! watch your money because its important as we age to be independent but!!!!!!! dont live a sick lifestyle by going trough life avoiding pleasures because you have become mentally ill focused on nothing but not spending money.

    by tom — March 22, 2013

  20. Thank you CB. We will check it out.
    To Tom, I don’t believe we live “sick lifestyle”. Trust me, we enjoy our lives without spend ton of money. We enjoy movies (Free movie every Tuesday from Optimum reward)dinning (use Groupons to try out new places) and go to vacations (use AAA and find great deals)…etc. I love cooking so we splurge cooking gadgets and ingredients, but most of the time I can whip up a good, healthy meal from something on sale. I bake my desert because my hubby is diabetic. Once I was workaholic, working long hours, making a lot of money, and buying and doing anything I wanted but I was not happy; I just filled my void with things I did not need. Now I am much happier!!

    by Francesca from NY — March 23, 2013

  21. Good for you Francesca!

    by Stacey — March 23, 2013

  22. Francesca would you share where you live cheaply in New York I have to leave due to taxes. I’m in Westchester county.

    by RUBYTUESDAY — March 23, 2013

  23. RUBYTUESDAY, we live in Westchester, too!! I totally agree, taxes are brutal. If we don’t live here, we could have gone one more vacation a year. We are in process of selling our home here and move to either Delaware of North Carolina, so that my husband can fully retire. Where are you moving to?

    by Francesca from NY — March 24, 2013

  24. Francesca, One week its Florida next week it’s Delaware, North Carolina, South Carolina get the picture? LOL.. the more I read this board the more I feel that I should stay put until either I die or I’m a widow. I think I will put in a new driveway after I have the fence fixed and when everything turns green and pretty I will stay put. If I become a widow it will be a no brainer I will move myself to a small place like SPRINGVALE apts in Croton where I live now.

    by RUBYTUESDAY — March 24, 2013

  25. I live in NYC, a coop in Brooklyn. The neighborhood has seriously changed and I feel live a stranger in a strange land. I’m also so tired of the weather. I still have a good 4 years before I retire. A good friend and I (we’re both divorced) are looking at Sarasota, FL, Asheville, NC or Athens, GA. We realize no place is perfect including where we are now. We put our “must haves” together and came up with those three places. We need to be in a more liberal environment that has theatre, museums, educational opportunities…anyway, you get the picture. Any suggestions would be greatly appreciated.

    by Stacey — March 24, 2013

  26. I hear you, RUBYTUESDAY. Same here. We are looking into Delaware because of better Tax, so that our savings and 401K etc will last longer. ( I will still work part-time because I love my profession).BUT houses are pricy. We are planning to visit Delaware next month. Stacey, have you ever visited these places? You must. …and no place is perfect. What about the Triangle area in NC? We have a friend there and we visited several times. We are most likely rent before we buy anything.

    by Francesca from NY — March 25, 2013

  27. Francesca good luck with the sale of your house it’s the best time of the year to sell no leaves, parents planning for schooling etc. Keep us informed about Delaware places that you are seriously considering.After reading about the 85yr old that was so good naturedly giving two teens a ride I’d stay out of Lincoln..

    by RUBYTUESDAY — March 25, 2013

  28. Francesca: We are planning to visit each one. Still don’t know where we’ll wind up. Thought about Delaware since I’m in NY and she’s in VA. Only problem I have is the weather in the winter. We also plan to check out the triangle area in NC. Thanks for your suggestions.

    by Stacey — March 25, 2013

  29. I am a bit late….but to “Just Retired” from a post dated March 4th. How come you call Arizona “not tax friendly”? You actually said you wanted to move from Arizona to a more tax friendly state.
    I always see AZ listed in the most tax friendly list of states, even in lists of the 10 most tax friendly states. Within the next 16 months we will hopefully move from Illinois to AZ. Your tax friendly comment won’t change my plans…..but I am curious….want am I missing about taxation in AZ?
    :shock:

    by David Coughlin — March 26, 2013

  30. Stacey: You are right about Delaware. Going back to the topic of this blog, we need fewer clothes if we live in warmer states!! Right now, I don’t own many clothes; after I finished working in NYC I sold most of my fancy clothes at eBay, kept only basics for my part-time work. I hope I can get rid of all heavy winter coats and show shovels!! RUBYTUESDAY, we are concern about crime rate in Delaware, too. I will keep you posted.

    by Francesca from NY — March 27, 2013

  31. Re: Cheapskate
    I too find that I have been doing most of these for years. My kids used to laugh at me for washing plastic bags (which I almost never buy). Now they wash bags and call it recycling. But as I age, or get lazy, as so many say, there are life style choices. I do not want to count every penny. I do not usually use coupons as they take so much time to compare, get right size and item. I may have more time but I also have less energy. I choose to buy local food, after trying to garden for years. It may be more expensive, but I feel I am helping the local economy and I do not have to worry about “pink slime” in my local meat. Americans spend less % of our income on food than many companies and do it by eating cheap empty food.

    Eating out is not important to me except for special occasions. I do not golf or have a boat, or go bowling or play cards. There are plenty of volunteer opportunities for activity and fellowship, and you are making a contribution.

    by Moving South — March 27, 2013

  32. Correction to Cheapskate. I meant other countries spend larger % of income on food, not companies.

    by Moving South — March 27, 2013

  33. To David Coughin, I agree that AZ is a tax friendly state. I have found this site to be most useful in exploring the tax impact state by state.
    http://www.kiplinger.com/tool/retirement/T055-S001-state-by-state-guide-to-taxes-on-retirees/index.php
    The one thing I have been told a number of times from Real Estate Agents while looking in the Sedona Area/Prescott, is that a major problem in the future for Arizona will be accessibility to water. Supposedly the majority of water that flows through AZ is water that has ‘rights’ for use in CA and therefore future water prices in AZ can expect to seriously increase. Maybe on par with what our rising health care costs will be.
    I’ve lived in the SF Bay Area and experienced how your rate increases as the elevation of your property above sea level increases, a $200-$300 quarterly bill was not unusual for 2 people. Summer posed a special problem because once the lawn sprinklers were started up your bill could be $500/600 quarter. And if you live in a planned community with HOA’s you either paid the higher water bills to abide by the by laws of keeping your lawn green, or faced the HOA’s monthly fines!
    Living in NY now and being gouged by the local water utilities here, along with years of lower reservoir water levels despite ample hurricanes and snow storms, I can only imagine what expenses will be in an arid climate. :cry:
    Maybe a property with it’s own well is the way to go? Good Luck with your search :wink:

    by Jane — March 28, 2013

  34. If you have high speed Internet anyway, you might look at Ooma for your home phone solution. I’m getting ready to retire in 2 months and I’ve gone from about $55.00 monthly for AT&T and long distance down to $3.84 monthly. You do have about $170 initial cost but that pay back is quick.

    by Doug — April 10, 2013

  35. As a sungle mother of two wonderful children (now in college) I always had to watch my income versus cost of living. I have used coupons, buy one get one free offers, and other discounts. I have always used credit cards to be paid off when the statement arrived and therefore was able to use the reward points to take my children on a vacation. We sporadicaly splurged going to a movie but went on there weekly family dsy and spend less than 10 dollars for the three of us (ticket, popcorn, and drink included) Cooking and baking at home not only was cheaper but also provided us with family time and taught my children to be self sufficienced in college. They themselfes now use coupons etc. as it was part of live growing up. We had to (and still have to live) in a shoestring budget but we never felt on missing out on anything at all as LOVE FOR EACH OTHER was always the most priceless item. My conclusion is that the living a frugile lifestyle has a different meaning for everyone as is the way in which togo about it. There are so many suggestions out there and my best advice is : take what you need and leave the rest, find ways which fit your comfort level the best.

    by Petra — November 19, 2013

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