The news just gets worse every day. After years of record debt and living beyond our means, Americans are starting to get it: We’ve got to change our ways and cut back.

Frugality has not been hip and cool for a long time—at least since baby boomers came along. But in her great essay in Time magazine this week called “Real Patriots Don’t Spend,” Nancy Gibbs wrote about the “mighty faith in the power of sacrifice as a muscle that made young nations strong.” Both presidential candidates skirted the question about sacrifice in their recent debate. But maybe it would be better—and healthier—to face the need for sacrifice head on, accepting the duty and even nobility of the cause.

A recent page one story in The New York Times, "Full of Doubts, Shoppers Cut Spending," reported that we’re starting to get the message. “The last few days have devastated the American consumer,” said Walter Loeb, president of Loeb Associates, a consultancy, who said he worried that the constant drumbeat of negative news about the economy was becoming a self-fulfilling prophecy. “They all feel poor.”

Yes, we are spending less. But it doesn’t have to be painful. “In hard times, people often rediscover the peace that prudence brings,” Gibbs writes, “when you try to spend a little less than you have.”

I learned this lesson the hard way when I was younger. My parents, children of the Great Depression, were always frugal and lived within their means. To me, this seemed silly, nerdy, stodgy—no fun at all. Why save for a rainy day when credit cards could let you have it all right now? I ended up in credit card debt up to my eyeballs, unable to pay even the minimums each month. And the stress of it was agonizing and unhealthy.

But when I finally faced the reality, made a budget, and started paying down the debt, the sickening dread lifted, bit by bit, month after month. Soon it was fun to see the balances go down, till eventually they were all zero. I learned to say no, and that virtue has stuck with me and gives me comfort now.

Hard times can help you remember what’s really important. Roxanne Black was diagnosed with lupus when she was 15 years old. In the past 20 years, she has had two kidney transplants and has spent endless amounts of time in the hospital. But she turned her illness into something positive by creating the Friends’ Health Connection, a group that matches patients with others who have the same illness to provide information and support.

Along the way, she’s learned a lot, as she explains in her new book, Unexpected Blessings: Finding Hope and Healing in the Face of Illness. In the chapter titled “The Secret of Happiness,” she tells a story about visiting an old friend who had become very wealthy. He and his wife lived in a palatial home with marble hallways, multiple living rooms, and every luxury imaginable. “But instead of appearing wildly grateful,” she writes, “my friend and his wife both seemed aggrieved and dissatisfied,” constantly complaining, harried, and anxious.

Research shows that once our basic needs are met, material possessions don’t contribute much to our happiness. So what does bring contentment? “Strong ties to friends and family as well as religious faith seem to lift the spirit,” she says, “along with such boosters as practicing gratitude and performing acts of kindness.”

Black says she was relieved to return to her own house that day and curl up in her favorite (decidedly not opulent) room. “We call it the family room,” she says, “because it’s full of items passed down from both my and my husband Leo’s families—a pair of bookcases that were a wedding gift to Leo’s parents from his grandparents, a rocker that once belonged to his grandmother, and that Leo himself rocked in when he was child, walls of sepia photos—possessions that aren’t worth a dime to anyone but us. I like to sit in the rocker and look at the walls, lined with memories, beloved faces from the past and present.

“The room is also near the kitchen where I can smell the dinner simmering, and from a window I can view the bird feeder, busy with cardinals and blue jays feasting on sunflower seeds. These small daily pleasures are an internal wealth that no one can take away.”

We all know that feeling, don’t we, when we remember to tap into it. I live in a small apartment in New York City with not nearly enough closet space. But it has a great view of the Empire State Building veiled in different colors each night. And every morning I can take my espresso onto the tiny terrace and watch the seven fat, identical seagulls that line up like Rockettes on the building across the street, facing east toward the rising sun.

As Black writes in her book, “The Talmud asks: ‘Who is wealthy?’ and it answers: ‘He who is content with what he has.’

“In the end, this is happiness: savoring our journey in the middle of living it.”