Saving versus spending - striking the right balance
By far the most difficult part of getting out of debt is not incurring more debt. A while back I started an extra savings account to save for new gadgets, namely a new dSLR camera. But every time I save a decent amount of money in the account I decide that I would rather put that money onto my credit card to pay it down further. It has been great for paying off debt, but not so great for me actually getting a camera. So far I have been patient, but it’s getting tougher to resist the siren call of spending.
Flexo at Consumerism Commentary has a post about frugal lifestyles and whether we are missing out on some of the fun things in life. I completely agree with the analysis, and feel that it’s important to strike a balance between planning and saving for the future and enjoying your money now.
The followup article was also interesting, noting that actually having money provides a lot of freedom that “stuff” will never provide, particularly freedom and time. When you have enough assets to cover your living expenses, you no longer have to worry about a job and you are free to do whatever you want with your time.
How does this fit in with me wanting a new camera? Right now I still owe a lot of money on my credit card, and I feel that no matter what paying that off is priority #1. Although I would rather spend my money on fun stuff like gadgets and vacations, my debt is not going to go away on its own. My debt was incurred buying “fun stuff” when I couldn’t actually afford them, and now I am paying for it (with interest no less). But once that debt is paid off I shouldn’t feel so guilty about spending money, as long as the spending is kept within reason. On the bright side, I still have a lot of cool stuff sitting around to keep me occupied until then!
I just hope that I can keep up this mentality for another year while I continue to payoff debt and then build an emergency fund. Patience will be key.
Anyone care to comment on when they think it’s okay to spend money versus saving it for the future (especially if young ones are in the picture)? Cheapo, I know you’re out there somewhere! Let’s hear your thoughts!
