The Goal of Saving is Spending

For short periods of time you can deprive yourself of certain comforts in order to afford others. Just after graduation I lived in a group house in DC with five other people. But I also went out to eat quite a few nights a week and spent quite a few hours in bars down in Georgetown. Of course, I couldn’t spend money on anything other than food, because I didn’t have the space to store anything new. But there is no way that I could have lived in a messy, dysfunctional house, eaten dinner at home every night, and deprived myself of any activities with friends or family. Instead I chose to save money on the biggest expense: housing. With only $310 in rent due each month, (in 1999), I was able to save a significant amount of salary, and still have an incredible life in the city.

The point is: the goal of saving money is not to wake up one day with a pile of money. The goal is to save money in certain aspects of your life in order to be able to afford other luxuries. I am proud to say that I have never kept a balance on my credit card. Every month I have found a way to cut back on one expense in order to be able to afford another. Plus save a significant amount of my salary. If you can save $40 a week in groceries. Then you deserve to eat out every once in awhile with the $40 you’ve saved.

Two summers ago while my husband and I were vacationing I went for a walk and found a house I thought we should buy. When I mentioned the house to my husband, he said, “I’m not interested in buying a house. Let’s just finish paying off our primary mortgage.” At first, he was unwilling to sell his stocks or mutual funds. He had grown attached to the balance in his brokerage account. He had gotten used to seeing a certain number and didn’t want to see that number dwindle. He had forgotten that he was saving money that should ultimately be spent.

Of course, that doesn’t mean every time you save money you go out and spend it. I’m certainly not advocating that. Rather we save money in order to be able to enjoy our lives. There is no point in saving every dollar today and then waiting 30 years to take pleasure in that money. Along the way you have to enjoy your life, and more often than not, that enjoyment will require spending some money.

Buying our beach house is one of the best decisions we’ve ever made. Driving down to the beach, my husband and I get to spend hours alone discussing our dreams and plans for the future. We get to sit out on our deck and watch the sun set. We get to start each new day with a morning swim. Had we not bought our house we would have put the money in the bank and watched our balance grow.

This is, of course, more noble than spending all your money, or worse yet spending more money than you actually own. If you’ve read any of my other posts you know that I am a huge proponent of saving money, but I also think it’s important to enjoy the money you save along the way. The goal is to be frugal with your money… not miserly.

3 thoughts on “The Goal of Saving is Spending”

  1. Totally agree with you. So long as one is able to find a good balance between saving and splurging, of course. Your house is a splurge that will also appreciate in value so that makes it a particularly good splurge!

  2. I agree generally with your comments however there are 2 points I’d like to mention. 1. Your splurge also happened to be an asset that will grow in value and one you can continuously enjoy. Unlike a vacation for instance which just uses your money up, and lasts for one time only. So you’ve hit a sweet spot with the beach house. 2. However another consideration is, to use an economic term, opportunity cost. Is the enjoyment from the splurge worth working an extra week, month, few years, in a job you don’t like. I haven’t really enjoyed the jobs I do, so I save and invest even harder knowing of the years I’ll be able to do what I want. I keep in mind this end game and only splurge a small % of my income.

  3. m & yp – Excellent points! A vacation home can be viewed less as a splurge and more as an investment. This is certainly a lot different than spending a week long vacation in Vegas, where you have nothing to show for your trip but memories.


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