I recently had an epiphany.

It wasn’t in the shower. It wasn’t while meditating under a tree. It was while sitting in the bathroom.

As I held the toilet paper in my hand, I realized that it was single-ply. Clearly, I had long ago decided to save money by cutting this corner. “We are not in a position to indulge in such excesses!” I imagine I might have thought, shifting my shopping gaze from comfy double-ply Charmin to a stoic, mascot-less house brand of single-ply.

Of course, here’s the problem: single-ply is a fool’s bargain. It’s a translucent sham. If you don’t want to shove your fingers directly into the pit of despair, you need to fold it over itself again and again, defeating any cost savings. And even if you did save $5 per month, isn’t the extra $5 worth trading 30 days of butt-sanding for 30 days of butt-caressing?

To make any headway with this, I first had to look backward…

My family didn’t have much disposable income. We ate a lot of TV dinners, we collected our soda cans for the five-cent redemptions at the beverage store, and we bought books on the discount “remainder” table at the local bookstore. To be clear, I never felt poor, but I knew that we weren’t rich. 

And our extreme frugality served a critical purpose at the time. It was important to the well-being of our family. Clear parameters around spending, and clear taboos around money, kept things from falling apart.

But flash forward 35+ years. Optimizing for frugality is now old, childhood software that’s been running in my head — unquestioned and unexamined — for decades. It became a default mode during formative years, and it got grandfathered into my current life, where it simply doesn’t apply in the same way. No conscious, comprehensive updates have been made in a very long time.

So, sitting with my pants around my ankles, I began asking about the rest of my life: where am I still using single-ply?

Where am I still choosing the lowest-cost or low-cost option without thinking about the downsides?

To dissect this, I’ve been 1) looking at how I spend money, and where it’s provided outsized returns, and 2) asking myself — as a recovering frugality addict — a bunch of uncomfortable questions.

1) Looking at how I spend money, and where it’s provided outsized returns. Especially as I approach the new year, this pairs well with a Past-Year Review (PYR). In practice, it’s really simple. Look at different records of your past spending and note down anything that you feel was money really well spent. Here are a few approaches I like: reviewing Amazon purchases for the year, looking at all of my photos from the past year, and looking at credit card statements. I found the photos to be particularly useful. Equally helpful is looking for spending where the juice wasn’t worth the squeeze; in other words, where was the cost not worth it? These are things you can trim to make space for higher-value investments.

2) Asking myself — as a recovering frugality addict — a bunch of uncomfortable questions.

Here are a few I’ve found helpful so far: 

What purchases of $100 or less have most positively impacted my life in the last 12 months? Are they grouped in particular areas? In my case, as an example, nearly all answers were related to sleep, health, travel/experiences, or gifts for family and friends.

What might it look like to invest more than $100 into those high-leverage areas? What might it look like if you spent $1,000, $10,000, or $100,000 per year? I realize this might seem insane, but it might also be the most important question. The goal is not to unleash the Kraken of irresponsibility and spend like a drunken sailor. If you’ve been programmed to buy gallons of Costco ketchup to save two cents per serving, these questions are simply thought exercises, intended to stretch you in the opposite direction. As I mentioned in Tools of Titans when discussing Peter Thiel’s seemingly absurd question of “If you have a 10-year plan of how to get [somewhere], you should ask: Why can’t you do this in 6 months?”: 

“Now, let’s pause. Do I expect you to take 10 seconds to ponder this and then magically accomplish 10 years’ worth of dreams in the next few months? No, I don’t. But I do expect that the question will productively break your mind, like a butterfly shattering a chrysalis to emerge with new capabilities. The ‘normal’ systems you have in place, the social rules you’ve forced upon yourself, the standard frameworks—they don’t work when answering a question like this. You are forced to shed artificial constraints, like shedding a skin, to realize that you had the ability to renegotiate your reality all along. It just takes practice.”

Podcast guest and personal finance expert Ramit Sethi helped me think about high-leverage spending by introducing the concept of pulling “financial levers.” He recommended asking hypothetical questions akin to “If physical fitness and health are so important to you and affect everything else, what might spending 10x more per year on that look like? 100x? If you can afford it, how could you test it for a short time to gauge the results?”

One personal result: I combined my answers to this and the first question to gift my parents packages of sessions with a personal trainer (i.e., health + gifts to family and friends + 10x spending). After a short trial period, the physical and emotional rewards have been so great that I’m going to continue with this for the next year.

What indulgences were worth it? Which indulgences would I repeat? What do they have in common?

What indulgences were not worth it? What do they have in common?

Where can I spend more money to create frequent moments of joy, or where can I spend money to save time? What might a two-week test look like, just to dip my toe in the water?

Make an inventory of things you do on a daily or weekly basis. For an extra $100 per month, for instance, you can have the best toothbrush, toothpaste, laptop stand, socks, eye mask for sleeping, and more. For $10-50, you can also take many of your enjoyable vices from mediocre to world-class.

For saving time: What about wash and fold laundry? What about dog walkers? What about paying someone to clean your car interior? Commit to making a list of at least 20 ideas, and include the absurd. Brain dump now, edit later.

The above are all real examples from my life. The little things can make a big difference. In fact, in day to day life, the little things often are the big things.

THINKING ABOUT FRUGALITY, NOT THOUGHTLESS FRUGALITY

What might it look like to be frugal by choice instead of by default?

Once again, there is a time and a place for frugality. There are situations where survival-level spending habits are the smartest habits.

There are also times for asking “If I spend this dollar, where is the highest-leverage place to spend it?” instead of simply “How can I avoid spending this dollar?”

As a personal example, I’ve decided that I’m happy to spend a lot of money on ethical, quality food, but I’m rarely willing to spend more than $50 on a bottle of wine. I can easily tell (and feel) the difference between mid-tier and high-quality food, but fancy wine is like pearls before swine for this Long Island boy.

What might it look like to move from scarcity-based decision-making to outcome-based decision-making? Not to spend as much as possible, but to more intelligently and rationally answer the question, “Where should I invest more and where should I invest less? Where does it make a meaningful difference?” Note that the order of these questions really matters. Ask first “Where should I invest more?” and then only “Where should I invest less?”

What does your last year — not your childhood beliefs — tell you about where you might invest more for a higher quality of life?

Please do let me know your thoughts in the comments. For me, this is a work-in-progress, and I’m eager to learn from others.

Where are you still using single-ply?

Where has spending more, or reallocating funds, helped you the most? Or where do you think it would help you the most?

What other questions have you found helpful for thinking about these topics?

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Recommended resources:
Forget New Year’s Resolutions and Conduct a ‘Past Year Review’ Instead
How to ‘Waste Money’ To Improve the Quality of Your Life
Testing The “Impossible”: 17 Questions That Changed My Life
Ramit Sethi — Automating Finances, Negotiating Prenups, Disagreeing with Tim, and More
Mr. Money Mustache — Living Beautifully on $25-27K Per Year
Interview with Peter Thiel, Billionaire Investor and Company Creator

The Tim Ferriss Show is one of the most popular podcasts in the world with over 400 million downloads. It has been selected for "Best of Apple Podcasts" three times, it is often the #1 interview podcast across all of Apple Podcasts, and it's been ranked #1 out of 400,000+ podcasts on many occasions. To listen to any of the past episodes for free, check out this page.