Im taking a similar approach to savings as I did for paying off my debt. I will stay consistent and be purposeful with my money but I will not put my life on hold. I created FI PITTSBURGH to be focused around the same mentality. This is a place where I want people to understand that it is ok to enjoy today and spend some of your money now. I based our motto around this exact idea. ENJOY TODAY WHILE PREPARRING FOR TOMORROW! The path to financial independence is a marathon, not a sprint. Those who take the extreme frugality approach will likely fail due to exhaustion, but those who pace themselves will see success.
In order to stay frugal but enjoy the gift of everyday life, I try to implement the psychological approach of what I refer to as “The Chocolate Theory.”…….(FREE BEER THEORY was a better way to get your attention, sorry for the bait and switch.) This is based on the premise that the less frequent you have something the more enjoyable it can be. If you eat chocolate everyday with your lunch, it becomes routine and the chocolate loses its uniqueness. However, when limited, the same piece of chocolate only eaten once a week has a greater appeal and the experience of that piece of chocolate is heightened. A good example of how I use this in my personal life, is the way I purchase beer. I currently love Hazy IPAs. For you beer lovers out there, you know these cases are typically around $40. Purchasing one of these cases every two weeks definitely does not fit into a frugal lifestyle. I compromise by purchasing a less expensive beer for the first two cases. These cases will typically run $20. So, on average I will save $40 over those two cases. By the time case 3 comes around, I am eagerly waiting for that citrusy, hoppy golden nectar. Notice how saving on those two cases of beer leads to paying for my targeted beer! Not only do I get to enjoy the taste of my favorite beverage but it is essentially free!….Ok, there’s your “Free Beer Theory!”
The concept is very basic but it can be used in multiple aspects of life. My family exercises this in many different stages and sometimes without even realizing it. The day-to-day decisions: cooking dinner vs going out to eat, the weekly decisions: grocery options – name brand vs off brand, the monthly decisions: going to a sporting event vs watching from home and yearly decisions: vacation destinations – local, weekend trips vs out-of-state, week trips. The beauty of applying this strategy to your life is you can rob Peter to pay Paul. You can decide to stay home for dinner, buy generic brand groceries and watch all the sporting events from your living room and that way you can take your family to the beach for a week. Flip the script, you can pull back on the big vacation and live more vibrantly when deciding on your daily, weekly or monthly options. As long as you stay mindful with the actual costs of these decisions, you can really enjoy life while saving for the future.
Now my thoughts on this approach may be out of the ordinary and some may say you’re only saving $40. My rebuttal would be the fact that I am currently in a marathon and just as running one, the mental aspect can be the largest hurdle. If I make daily purchases with this mindset, that means I am constantly practicing frugality without giving up the things I love. In addition to all of this, every time I purchase that 3rd case of beer I am awarded a small victory. These are the small victories that will push you and keep you striving towards a long-term goal. It can be something as simple as a case of beer that gives you a two week break from the frugal lifestyle you are currently living.
If you are currently struggling with your finances, there’s a good chance you are looking for a win today. The great thing about this strategy is you can start today and instantly see results. All you have to do is pay attention next time you go shopping at a store or online. I am all for a budget and I actually recommend starting one but I remember how exhausting all the researching and allocating for the budget was. So, before you give up without truly getting started, I would like to challenge you to reevaluate your daily spending. Think about what items you can limit in your daily consumption or items you can substitute that will give you similar fulfillment for half the price.