Is Your Lifestyle Preventing You From Saving?

August 8, 2007 at 4:10 AM 5 comments

My husband and I had a frank discussion about finances over dinner tonight. The question at hand: Why are we able to save a large portion of our income each month? His answer: Our lifestyle. At first, I didn’t agree with this assessment, but after further contemplation I find I can’t argue.

Compared to many of our friends my husband and I are already a very stable, married couple. We don’t go out to bars, clubs, or even fancy dinners. We don’t travel to extravagant destinations or drive expensive cars. As my husband said, “We wake up. Go to work. Come home. Spend time with one another. Go to bed and wake up again tomorrow to do it all over again.”

At the micro level our favorite activities simply don’t cost much money. We’d much rather cook at home than go out to dinner. We are huge sports fans but prefer the collegiate level to those of the pros and we’d rather vacation in North Carolina than fly to an exotic location half-way around the globe.

But it’s easy to see how small changes in your lifestyle can affect your savings. For example, my husband and I used to be season ticket holders for the Washington Capitals. Season tickets cost $1700 per ticket. Games were usually held after work and my husband and I easily spent $40 – $50 on beer and food at the games. The hockey season is a long one, and between the tickets, food, and metro rides to and from the games we quickly found ourselves spending thousands of dollars. Sadly, Ted Leonsis sold all of the best hockey players a few years back. When we no longer recognized the names of the players we gave up on the Capitals and stopped purchasing tickets. We began purchasing University of Maryland football and basketball tickets instead. The combined cost of two seats to both sports is less than one hockey ticket.

Small changes in your hobbies and passions can also drastically affect your finances. A co-worker of mine spends hundreds of dollars each month creating custom jewelry. Another spends hundreds on scrapbooking materials. They both admit that they started by purchasing only $50 worth of materials, but as their hobbies have grown so have their appetites for better materials.

My husband recently experienced this phenomenon as he began pursuing photography as a second career. His initial camera cost only $500. His latest equipment a camera and two lenses cost thousands of dollars. But life is meant to be enjoyed and life would be rather dull if we didn’t pursue our passions. So I encourage my husband to pursue photography, but, of course, I remind him that he cannot purchase new equipment until we have saved enough money.

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5 Comments Add your own

  • 1. DebtMan  |  August 8, 2007 at 5:46 AM

    I agree completely with your article. With two healthy incomes, its easy to spend money on seemingly little things that really add up when you put them all together.
    When I find my finances unexpectedly tight, I put together a basic budget showing my current income/expenses. If I do this a few times a year, I can quickly spot trends as to where my money is going.
    I have a basic article on creating a budget on my blog. The article is more catered to those in debt, but a basic budget can be useful for anyone that needs to get real about their finances and often allows folks to see areas that they need to tighten up on to relieve their financial strains.

    –DebtMan

    Reply
  • 2. Joan  |  August 8, 2007 at 11:34 AM

    You are correct. Being and living in NC, I’m glad you like to vacation here. The fact our state has beautiful mountains and beaches keeps our vacation costs down.

    Reply
  • 3. Meg  |  August 13, 2007 at 7:37 PM

    Lifestyle is definitely a big issue with my husband and I. We used to spend so much money on eating out because that was our time out and together. We’ve cut down quite a bit, but it can still be an issue. He works a lot out of the home, so he tends to eat out a lot for lunch. I was a student until recently, but I tried to wait till I was back home to eat, though sometimes we ate out together. I’m working from home part time now, so I eat at home most of my time.

    On the other hand, staying at home gets boring. So, now I shop a lot more. Even though I’m a bargain shopper, it adds up very, very quick – especially when I factor in gas. We have a gym membership and there’s a library nearby, so I’m trying to get myself there and not to the mall. It’s hard, though. A lot of it is just habit at this point.

    Reply
  • 4. Fabulously Broke in the City  |  August 13, 2007 at 7:51 PM

    The best comment for me is from your husband: “We wake up. Go to work. Come home. Spend time with one another. Go to bed and wake up again tomorrow to do it all over again.”

    That’s exactly the way I see it with my husband and I :) We both do the same thing, except he waits in the hotel room for me to come back from work.

    “Lifestyle” gets expensive when you don’t control it and get accustomed to having the finer things in life once you upgrade..Then the rush is gone and you take having a cleaning lady as a necessary service rather than a luxury.

    Reply
  • 5. Jason Dean  |  August 15, 2007 at 6:44 AM

    This was a very interesting article — I highlighted it at my blog, SmartMoneyDaily.

    I like the caveat at the end about making sure you enjoy living life. While it is good advice to not buy things you don’t want / don’t need / don’t enjoy, it is NOT good advice to be overly frugal. You need to make sound economic decisions. Is spending the money now really worth it TO YOU when you factor in the cost of later? It could be the answer is YES. In that case, the rational thing to do is to spend the money. Life IS meant to be lived!

    Reply

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