This is a guest article by Leo Babauta, originally published on Consumerism Commentary on April 3, 2007. Leo, the author of Zen To Done: The Ultimate Simple Productivity System writes about achieving goals, creating habits, productivity, personal finances, frugality and more at his blog, Zen Habits.

On Zen Habits, I detailed some of the things I have cut out of my life in order to save money and eliminate my debt, such as cutting my own hair, cutting out cable TV, becoming vegan, working out at home instead of the gym, brown-bagging it to work, never going out to clubs or the theater, and more.

An anonymous reader then commented, sarcastically, “Here’s another way to save money. Lock yourself in a box until you slowly die of starvation and/or boredom.”

I understand that sentiment. When I list out all the things that I’ve cut out of my life, it sounds horrible, even to me. But here’s the secret: if you cut things out a little at a time, it doesn’t seem hard at all.

And here’s another secret: living frugal isn’t that hard at all — in fact, it’s extremely enjoyable!

I didn’t cut out all the things on my list all at once. That would have been quite a drastic change, and I’m not a fan of drastic changes. My philosophy is that changes should be made gradually, with baby steps, over a long period of time, otherwise they won’t be sustainable. Want to lose weight? Don’t try to drop 30 pounds in a month — lose a pound or two each week, and over the course of a year you’ll lose 50-100 pounds!

The same goes with frugality. Cut out one thing from your life, or change one spending habit, every couple weeks, and over time you’ll have cut out a lot of unnecessary spending. The thing is, you get used to the changes, and after a while you don’t notice that those things are gone. Sure, cutting out cable TV was a big change at first, but after a month or so, we didn’t miss it at all. Now, it seems crazy to have cable TV all the time. We go over to other people’s houses, and they’re glued to the TV all day long. That’s not a criticism of them, but an indication of how our lives have changed. There are other things we love to do besides watch TV, and if you’re creative, they can be fun and cheap!

Here are my tips for gradual frugality:

• Start out by making a list of things you spend money on each month, big or small. List all your monthly bills, but also the little things you buy, like magazines and books and DVDs and gadgets and car washes and lattes and beer. It’s helpful to track your spending for a month — I just did it in February and it was very revealing.
• Mark the things on your list that are optional, not essential to living. There may be quite a few, if you haven’t been trying to be frugal until now.
• Choose a small goal to start. Don’t choose anything too outrageously difficult. Just choose something small that you think you could do without, perhaps magazines. This shouldn’t be something to which you’re addicted; that should be saved for later. The reason for starting small is to give yourself a chance to be successful in the beginning and then build upon that success for even bigger successes down the road.
• Stick with that one change for at least two weeks. A month would be even better if you can be that patient. After those 2-4 weeks, choose another item on your list. Make it a small one again, perhaps slightly bigger, but nothing huge. Repeat this process every 2-4 weeks, and you won’t notice much of a change.
• Celebrate every success! It feels good to accomplish a goal like this, and you should be proud of yourself. Reward yourself (but nothing too expensive!).
• Put your extra money towards debt or savings. If you’ve cut out $20 a week on small purchases, put $40 extra every paycheck towards paying off one debt, or put it towards savings if you don’t have debt. That’s a small amount, but it’ll add up to $1,000 every year. And as you cut out other things in your life, that amount will grow every month.
• Have fun for free or cheap. Don’t let this process of frugality be a process of suffering. Have fun while you’re doing it. Cutting out going to expensive restaurants? Pack a picnic and go to the beach or park instead. Cutting out your weekly movie night at the theaters? Rent some old movies on DVDs, pop some popcorn, and cuddle together with your significant other or family. Be creative! There are lots of great ways to have a blast on little money.
• Enjoy the process. You are cutting back on things to achieve a financial goal. That in itself is very rewarding. Always keep a positive mindset. If you feel like you’re having a difficult time, it will be difficult. But if you only allow yourself to think positive thoughts about your process of frugality, it will be as easy as pie. Speaking of which, making pie is a great thing to do for cheap!

Photo: pittaya

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