Is the New Frugality Here to Stay?

In 2009, cutting back was cool. Whether thriftiness proves to be short-lived fad or an enduring trend remains to be seen.

An LA Times piece reports not only that “Being frugal is back in fashion,” but that the free-spending days of yore may be gone for good:

For economists, the shift is chronicled through reams of data that track indicators such as consumer debt and same-store sales. The national savings rate, for example, which lingered around 1% in 2008, has soared to 4.4%. Sales of “apparel and notions” have fallen 13.7% since January. Consumers are even spending less at the grocery store, according to the U.S. Census Bureau.

All the data tell the same story. People who spent every dime of their disposable income two years ago are now saving and paying down billions in debt.

Certainly, this demonstrates scaled-back consumer behavior over the last year. But I’m not so sure what this says about the future. Once the job market improves and people start to feel secure again, it’s likely that they’ll tire of skimping, and those recently formed support groups—in which friends encourage each other to stay out of the mall—very well may dissolve. There have already been reports of “frugal fatigue,” of folks bingeing in gluttonous shoe-shopping frenzies after going cold turkey for months.

As one economist in the LA Times’ story says:

“Conspicuous consumption doesn’t necessarily go away. Once people can afford it, they go back.”

Done Deal: CBS Gives Green Light to Sitcom Based on Groupon

Daily deal giant Groupon is known for its peculiar sense of humor. There was the time the site “bought” April Fool’s Day. The introduction of marketing gimmicks like the creepy virtual discount wheel called “Clicky” can only be attributed to some offbeat sense of what’s amusing. And of course, from the beginning, subscribers have been reading Groupon’s trademark absurdist, careful-not-to-offend descriptions for deals arriving in their in-boxes. The fact that there’s a network sitcom in the works featuring Groupon is apparently no joke, however.

http://money.blogs.time.com/2009/12/17/attention-consumers-you-are-being-profiled/ Attention Consumers: You Are Being Profiled – It's Your Money – TIME.com

[...] smart shopping, Bloomingdale's, marketing, restaurants, Timberland, Wal-Mart To some extent, the "new frugality" of consumers seems like it is here to stay. That doesn't bode well for businesses that rely on the liberal [...]
http://money.blogs.time.com/2009/12/23/attention-diners-you-too-are-being-profiled/ Attention Diners: You Too Are Being Profiled – It's Your Money – TIME.com

[...] Just as retailers are keeping close tabs on shoppers, monitoring purchases and adapting to the "new frugality" among consumers, restaurateurs are stepping up the use of "Menu Psychology" to get diners to spend as much as [...]
http://money.blogs.time.com/2009/12/23/time-to-swap-your-credit-card-for-a-charge-card/ Time to Swap Your Credit Card for a Charge Card? – It's Your Money – TIME.com

[...] With a charge card, you simply cannot spend more than your limit—which is a positive for today's newly frugal consumer, though not long ago this would have been considered more of an inconvenience, something that'd [...]
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[...] the time to look back on whatever changes you made and evaluate whether you can make some part of the so-called "new frugality" a permanent part of your lifestyle. Make it a habit (not all habits are bad), and don't turn back. [...]
http://money.blogs.time.com/2010/01/13/you-will-be-living-in-a-place-that-resembles-europe-or-perhaps-china-or-australia/ You Will Be Living in a Place that Resembles Europe. Or Perhaps China or Australia – It's Your Money – TIME.com

[...] since the recession hit, we've become better savers. The national savings rate was measured at over 4% in December and at around 6% at various points in 2009. That's up from a rate of zero a few years [...]
http://money.blogs.time.com/2010/05/20/return-of-the-shopper-why-is-consumer-spending-on-the-rise/ Return of the Shopper: Why Is Consumer Spending on the Rise? – It's Your Money – TIME.com

[...] and after a year or so of living cheaply, shoppers want to get back to shopping like they used to, "new frugality" be [...]
http://money.blogs.time.com/2010/05/24/cheapskate-wisdom-%e2%80%a6-on-why-its-so-hard-to-be-a-cheapskate/ Cheapskate Wisdom … on Why It’s So Hard to Be a Cheapskate – It's Your Money – TIME.com

[...] and psychology at Carnegie Mellon University, in an Arizona Republic story about whether the "new frugality" is here to [...]
http://money.blogs.time.com/2010/09/01/two-sides-to-the-new-normal-spending%e2%80%94and-earning%e2%80%94less/ Two Sides to the ‘New Normal’: Spending—and Earning—Less – It's Your Money – TIME.com

[...] is supposedly on the road to recovery, we're getting a good look at the "New Normal." Not the trendy "new frugality," in which some consumers refrained from conspicuous purchases because showing off demonstrated bad [...]
http://money.blogs.time.com/2010/12/15/so-much-for-the-new-normal-is-the-era-of-mindful-frugal-consumers-already-over/ So Much for the ‘New Normal’: Is the Era of Mindful, Frugal Consumers Already Over? – It's Your Money – TIME.com

[...] consumers arose, the big question has been: Just how long would any "recession effect" last? Is the "new frugality" here to stay? Could there be an entire "Recession Generation," whose spending habits are forever affected by the [...]
http://money.blogs.time.com/2011/02/09/6-explanations-for-why-americans-cant-save-money/ 6 Explanations for Why Americans Can’t Save Money – It's Your Money – TIME.com

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