Something I’ve noticed when it comes to money about myself and others is that I can be very careful about spending on certain things, while spending crazy amounts on other things. When I first graduated I spend $60,000 on a truck without thinking twice, but complained about the price of avocados. I know people that will spend $200 on dinner, but drive across town to save a few cents per litre on gas. I've done this as well...go to Costco usually to fill up lol. I’ll also thought twice about paying for something small that I don’t really care about, but I’ve had no problem putting thousands of dollars into my investments when the market is down. It’s funny how we mentally categorize money. Putting $5,000 into an index fund feels productive. Spending $5,000 on something else can feel irresponsible. A $9 bag of avacado can somehow bother me more than a $60,000 truck payment. Even putting 7k into a TFSA is easy, but dropping 7k for my November trip to Asia was still tough to do haha. But at the end of the day, it’s all money leaving the bank account. Ive had to be honest with myself and think...am I actually being frugal, or am I just being cheap about the things I don’t care about? Being good with money isn’t about never spending, I've started to view it more as a tool and truly find it fascinating how our brains just categorizes money into different types. curious if anyone else also experience this?
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11 Comments
CoderDonna @coderdonna · 6d
I have done (and still do) exactly this, but I've throttled back a lot since I retired in January. I still spend on travel, but I find bargains (just came back from a ten-day trip to France - river cruise plus three-day extension in the Loire Valley: <$5K, including air fare and almost all meals). I don't buy something thinking subconsciously that it will change who I am - for example, I bought a little peddle boat thing, picturing myself and my friend peddling around the lake and having a great time while getting some exercise. We did it ONCE. Just buying gym equipment doesn't translate to being fit, you actually have to do the work. 😩 I've learned to overrule my subconscious and say no. My Amazon spending has really gone down. Took me a lifetime to step back and SEE those spending habits based on my dreaming inner child and just say no. (I still say yes to the occasional ice cream though!)
Sachi Polo
@chingblissie · 6d
I am so glad this was actually brought up here! This is one of the things I advocate for especially for people my age who would want to set themselves up for success while still enjoying their life. I see it as a “save on things that doesn’t matter so you can splurge on things that make a significant difference for you” mindset. I, for one, would not want to buy a car because I don’t want to pay for opportunity cost of gas and insurance and maybe also a monthly payment and would rather take the bus or borrow my parents’ care when I can. I put that 500/month in my TFSA instead. However, I don’t have a problem spending 5k on a trip to SouthEast Asia to see the world and explore. I also don’t have a problem buying costly things to take care of myself but I complain about expensive gas. I think it all just boils down to what we actually would want to prioritize, and having the opportunity to actually CHOOSE what to spend it on and also the opportunity of HAVING the money to spend. That way, we don’t deprive ourselves of what we want while still knowing we have our back for the future. Such a great thing to ponder on.
Sarah Giver
@staystronggiver · 6dEdited
There is no one universal answer because we fundamentally value different things. The only rule is to live below your means such that you can afford to invest. Once that is established, from there it can look different for everyone because we all value different things. For example hubby and I prioritize travel and neighborhood walkability above everything else, hence we sacrifice in other areas to make it happen. I have friends who couldn't care less about travel (have never left the country other than visiting the US) but they care about their home, so they will spend the money on kitchen and basement renovations for their home, that's equally valid. Anything goes as long as you can also save for retirement and other goals. Great post Will 😉 🙌🏽👏🏽.
Not Financial Advice @anpc86 · 6d
Time value of money … truck will hopefully last you at least a decade , you could allocate the cost per day or per ride and rationalize the expense something cheap and disposable is hard to justify putting a premium food - when you’re young you can eat whatever , your body will generally make it work but as you hit middle age, I’d put more of a premium on what you put into your body vacation|trips = experiences and memories have tendency to be considered priceless, so that’s personal choice , lot of cheap trips and finding deals can be fun some of the good memories when young and as I get older , I want to experience and discover more when I visit a place … These days I usually equate things to time now and my own pay rate and is it improving or saving time
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