Want to retire early? Then it is time to learn about frugalism!

If you are thinking about your retirement and not wanting to be in your late 60s and still working, one of the best things you can do is learn how to be frugal!

Frugalism describes a special way of life in which the so-called "frugalists" are committed. The goal: save as much money as possible and then never have to depend on wage labor again as soon as possible - like Lars Hattwig.

The German Lars Hattwig has made it: The 47-year-old has not been dependent on a salary for several years. However, he had previously lived extremely sparingly as a frugalist.

The term "frugalism" comes from the English word frugal, which means your are thrifty and sparing with your spending.

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Frugalism can be described as a lifestyle. The goal is to live so frugally that one has enough savings as early as possible so that you can live on these savings until the end of one's life and thus no longer depend on working to live. People who implement this lifestyle are called frugalists.

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Frugalism as a lifestyle is still a recent phenomenon. The term frugalism originated in the USA after the economic crisis about ten years ago. However, being frugal certainly isn't anything new, but doing so to retire early is a newer trend.

According to Stern, the Institute for Trend and Future Research in Heidelberg says: "Americans are finding that many compatriots still have to be very conscious of keeping their money together."

According to the trend researchers, a new wave of frugality can also be seen in the context of the COVID-19 pandemic. Due to the difficult economic times during the pandemic, many people changed their consumption behavior and have become more frugal, as Forbes reports.

However, frugality cannot be equated with frugalism. Pure thrift lacks the plan underlying frugalism of achieving financial independence through savings. Thrift is thus an essential part of frugalism.

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Frugalists aim to save between 50 and 80 percent of their income. So if someone was making $3000 a month, they would try to save at least $1.500 if not more each month.

Photo: Pixabay / stux

According to Stern magazine, Lars Hattwig achieved this high level of savings using very frugal methods, among other things: no travelling, no going out with friends, quitting smoking, using only a single burning lightbulb in his apartment and instructing visitors to flush the toilet as briefly as possible.

Frugalist Hattwig had set aside 70 percent of his income for several years and now lives off his savings and dividends. In addition, he works independently as a financial advisor - but not for financial reasons, but because he wants to.

Hattwig had previously worked as a meteorologist. However, he also says that for a frugal lifestyle, an income above the subsistence level is necessary so that a sufficient proportion can be saved.

There are no figures on how many people lead frugal lives or have saved for their financial independence in this way. However, Hattwig estimates that this is only a small part of society.

However, as a new trend, frugalism does not only have positive sides. According to the American Psychiatric Association (APA), the US professional association of psychiatrists, extreme saving can also be a symptom of an obsessive-compulsive personality disorder (OCD).

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Not only the extreme spending of money, but also extreme money saving can be symptoms of a mental illness. However, it is relevant here whether the extreme saving is a compulsive behavior or whether it is a planned behavior. The latter is the case of frugalism with the goal of financial independence.

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According to The Guardian, the American Elizabeth Willard Thames made it there even earlier than the German Hattwig: she gave up her career in the city, retired at the age of 32 and now lives in a house in the countryside in Vermont, USA. However, not by accumulating wealth, but through a permanently frugal way of life.

Photo: Unsplash / Peter James Eisenhaure

Willard Thames says: "In the beginning it was about saving money, but it was about much more than that. It became a major lifestyle change."

Photo: Unsplash / Kevin Davison

For Willard Thames and her family, however, this means that they will have to continue their frugal lifestyle in the future because, unlike Hattwig, they cannot fall back on the assets they have saved.

Photo: Pixabay / Myriams Photos

For Hattwig, however, the permanent frugalism associated with frugalism is not a permanent concept of life: "At some point you get to the point where you can no longer tighten your belt." Hattwig still lives frugally, but now also allows himself to travel or visit restaurants.