Eight New Year's Resolutions for Frugalistas by Vicky Oliver

Monday, January 9, 2012

Over the holidays, we all binge—it's only normal. It's hard to resist temptation, or the siren call of "buy, buy, buy," when our calendars teem with swanky parties, office shindigs, and festive family outings. But once New Year's Day arrives, it's time to tighten the proverbial belt with some austerity measures.

Still, crash diets rarely work. Anyone who's ever tried to cut spending cold turkey will tell you that if you slash all fun from your daily menu, you're destined to fail. The trick is to find the right balance between buying everything you think you need and total deprivation.

Here are eight New Year's resolutions for every frugalista who's determined to celebrate fashionista style on a shoestring.

Resolution 1: Let No Unused Gift Go Unreturned

Puce pajamas. Reindeer-themed sweaters. Jewelry that jangles like cowbells. In the crush of holiday gift giving, it's easy to stash some ugly present that you receive in the "black hole" of your closet—never to be seen (or heard from) again. But that's a costly mistake. You're literally leaving money on the floor of your closet! Instead, make it your mission to return each gift that you hate and exchange it for something you love. To get the best "exchange rate," try to hit the stores as soon after receipt as possible (hopefully before that item goes on sale after the holidays). The person who gifted you will never know, and once you're surrounded by all of the new items that you've personally chosen, it will feel like Christmas all January long.

Resolution 2: Throw a "Swap till You Drop" Party

Do you have a friend whose taste you admire? Of course you do. Agree in advance to pick out two scarves that you both adore, and then "swap" them with each other midseason. Just when you tire of your own wooly neck warmer, you can move on to hers. This tip is guaranteed to save you both at least 50%. For exponential discount power, host a "Swap till You Drop" party, and swap all the clothing you've grown bored with for all of the clothing your friends have. You'll all be dressed to the nines at a fraction of the cost—especially if you all bought the original items at the January sales.

Resolution 3: Name Your Price

We all carry price lists in our heads for what things should cost. We are like contestants on a virtual game of The Price Is Right, our brains conditioned to seek clothes that match our preconceived notions. But what happens when The Price Is Wrong? What happens when we just can't find nice threads at reasonable prices anymore? Is there any recourse? There is. Try befriending a salesperson in your local department store and tell her the price that's right for you. If you're lucky, she'll empathize and give you the inside scoop on the next "pre-sale" or "friends and family day" on the horizon. Then take your newfound friendship to the next level. Hand the salesperson your business card and ask her to email you with news about all upcoming store sales. It's always smart to have friend in your corner—particularly when you're trying to corner the market on sale prices.

Resolution 4: Put on Your Retailer Cap

No matter what day jobs they hold, all true frugalistas learn how to think like savvy retailers, almost having a sixth sense about which sales are genuine and which ones are trumped-up marketing gimmicks. "BOGO" sales (Buy-One-Get-One) only save shoppers money if they actually want the second item. "Loss leaders," which are items sold at prices so low that the store actually loses money on them, are designed to lure shoppers in to purchase higher priced items (where presumably, the store will recoup its losses). If you can cherry-pick your way through the BOGOS and loss leaders and shun all items that aren't on sale—that's a clever frugalista savings strategy. But if you have trouble avoiding anything wielding a full retail sticker price, try mastering some new ways to save money online by following Resolution 5 instead.

Resolution 5: Become a Groupie

Independence is highly overrated. There is power in groupthink—especially when the group happens to think it deserves a hefty discount. (Any group worth its buying mojo does.) Familiarize yourself with some websites that offer deep discounts to the group. Learn how to look for promotional codes online. Be proactive. Don't wait four score and seven years to check out foursquare. Vow to be more social for less of an outlay with websites like Living Social that offer deep discounts. The holidays may be long gone, but it's always the season to shop with the flock—and be richly rewarded for your efforts.

Resolution 6: Shop Your Own Closet

Before you go out and buy something new, make sure that you have thoroughly shopped your own closet. It's just like real shopping—minus the extravagant outlays that make strong Visa cards faint. "Shopping your closet" involves writing a list. It's not a list of the stuff you want; it's a list of the stuff you already have. Look and see what you own. Organize by color. And write it down. Reviewing your clothes on paper in this way will give you fresh ideas of how to mix and match the tops and bottoms for maximum flair, bottom to top. And who knows? After you conduct your own personal inventory, you may discover that you don't need to hit the sales racks right now after all.

Resolution 7: Rediscover the Joys of Reversible Clothing

Reversible clothing first started as a practical alternative for travelers who wanted to save room in their suitcases. While its dowdy "two-fer" image has been hard to erase from our collective fashion sensibility, today's options have little in common with your grandmother's reversible pantsuits! As more and more upscale marketers have jumped on the reversible bandwagon, it's suddenly become posh to double the fun at half off. Each time you purchase an item that works just as well inside out, it's like getting 50% off two wardrobe essentials. And the beauty is, you already know that the item fits perfectly. From dresses to blue jeans to belts to pantyhose, there are now tons of reversible options to play with, turning your whole wardrobe into a crayon box of fashion fun.

Resolution 8: "Layaway" Is Code for "Lay Off"

Any smart diet involves portion control: the same thing holds true for The Austerity Diet. If the only way that you can afford an item is by paying for it on layaway, then you owe it to yourself to walk away. When you first see the word "layaway," red warning signs should flash in your head. (If sirens sound too, all the better.) In plain speak, "layaway" means "immediate gratification but at too steep a cost." You just don't want to be indebted to some chain store for months on end for any item that you don't absolutely need. Instead, take a deep breath, hold your head high, and remind yourself that you're on The Austerity Diet, where some short-term pain will lead to long-term financial gain. It's always a good idea to shed some debt, and there's no day like today to get started.

For more pointers on saving money while you enjoy a luxe lifestyle, check out Vicky's new book, The Millionaire's Handbook: How to Look and Act Like a Millionaire Even if You're Not (Skyhorse, November 2011).

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