2 Rules to Avoid the Dark Side of Frugality

Frugality is a powerful force. It has the power to create millionaires out of average income earners and the power to liberate us from a lifestyle we don’t enjoy. Being frugal has the power to create options and expose our true potentials in areas we are passionate about. These positives should be weighed against the dark side of frugality.

A good friend of mine brought this topic up last week. He mentioned that the FIRE community overly stresses frugality and savings rate, often at the expense of creating memories and enjoying life.

My initial response to this was, “No way.”

I absolutely disagreed because — in my opinion — the FIRE community is filled with some real inspiring people, doing what they love and expressing how FIRE enabled them to become more creative, express themselves, and enjoy a happier lifestyle.

As I later mulled it over, I realized something; to a degree, my friend is right.

At the surface level, there is a gap in the community that often overlooks the, “enjoy life,” aspect. If you’re anything like me, you jump at the opportunity to explain how you were able to cut your grocery bill in half, or how you reduced your cell phone bill. We become excited to talk about savings because that’s where we place our focus, especially in the initial phases of financial independence.

We love to talk about what we’ve removed from our lives but we don’t often talk about what we’ve gained in the process. There is one hitch though.

Early Retirement down the road might not make us happy right now.

There are some bloggers who hone in on this right away. You probably can think of a few right off the top of your head. I think that’s why they’re so successful, because they understand there are rules to frugality.

Break the rules and you’re in for a life of misery. Live by the rules and you’ve set yourself up for a beautiful life.

Frugal Rule #1: Build our Savings AND Build our Lives

As Buffett explains it, “Don’t save sex for old age.”

Life is a journey and part of that journey is recognizing balance. Luckily, we live in an abundant time where resources such as the internet offer us vast treasures of knowledge and entertainment.

In our 90 Day Frugality Challenge, I’m finding numerous ways in which we’re building our lives without any impact to the rate at which we’re building our savings. The difference here is that I’m equally as focused on building each element. Ignore one and, my intuition tells me, life’s journey will be difficult.

Frugal Rule #2: Don’t Forget Rule #1

That’s it. Avoiding the dark side is not so complicated after all.

Have any frugal rules yourself? Do you feel experiences can be had without the need to damage our savings?

Master Distiller

21 comments… add one
  • Martin - Get FIRE'd asap Oct 24, 2016, 4:33 am

    It’s a fine balance between an enjoyable frugal life and just living a cheap lifestyle. That’s why it’s important to get the balance right early on don’t you think, Matt?

    • Distilled Dollar Oct 24, 2016, 8:18 am

      Yep! There’s no point in saving if you’re unhappy with some basic needs, such as housing or food. I think there can be a trap at both ends -under and over consumption. Finding that balance can be difficult at times.

  • Jay Oct 24, 2016, 6:48 am

    Totally agree with you, and your friend. Like many of your other readers who are focused on financial freedom, it’s easy to get caught-up in the spreadsheets as well as the associated routines. But I also try to remind myself that life is to be lived. So I always dedicate time each week to things I enjoy, whether that’s exercising, cooking, hanging out with friends or writing. Luckily, I hate shopping. 🙂

    • Distilled Dollar Oct 24, 2016, 8:21 am

      Hah! Sounds like we have similar hobbies and similar feelings on shopping! Part of me enjoys shopping, but only because it happens on such rare occasion that it is more of an experience for me now. I’m always fascinated by people who check out dozens of things and then leave the store with nothing.

  • Mrs Groovy Oct 24, 2016, 9:17 am

    There’s so much emphasis on frugality and minimalism in a portion of the community. I find it strange when people brag about wearing 3 sweaters in the winter and keeping the heat at 60 degrees – especially if they have a lot of savings and high incomes. Then again, Mr G and I seem strange to traditional retirees who wouldn’t dream of pulling the plug without budgeting to spend 80% of their income. We spend around 35 to 40% and we don’t feel like we’re cheating ourselves out of any experiences.

    • Distilled Dollar Oct 24, 2016, 5:36 pm

      Exactly – it all boils down to experiences. Luckily for us, much of the experiences we value are also inexpensive. 🙂

  • Tawcan Oct 24, 2016, 3:09 pm

    Life is all about balance. We can’t live on the extreme edges all the time, if we do we’ll burn out quickly. Simple as that. 🙂

  • Your First Million Oct 24, 2016, 3:38 pm

    In my opinion, there is a big difference between being frugal and being cheap. The difference is in the mentality. People who are frugal have a mindset that the money they save will be invested instead of wasted, which will eventually create a financial scenario where money can be spent with little consequences because the new amount of income is so great (abundance mentality). People who are cheap have a different mindset. They think from a scarcity perspective… they want to hang onto every penny because they fear losing money. They don’t want to spend money on anything because they are worried that they won’t be able to replace the money. This is just one aspect where I see being frugal and being cheap differ.

    • Distilled Dollar Oct 24, 2016, 5:39 pm

      Absolutely – abundance mentality goes a long way. When I view someone with an outrageously expensive car I tend to think, “awesome, she was able to afford that so I’ll have a similar pile of cash one day too,” instead of, “she’s just showing off with all the money that she scammed from…etc.”

  • PatientWealthBuilder Oct 24, 2016, 7:29 pm

    When you think correctly about money and material things, you actually begin to hate the things that are frivolous and waste a lot of money. Therefore, it doesn’t feel like being frugal. It feels like having more fun on a vacation spent in nature instead of in a line at a dirty theme park.

    • Distilled Dollar Oct 24, 2016, 8:35 pm

      Frugality to me means being efficient with our time and money. Removing some of the clutter, and those wasteful elements, only helps clarify the real assets that we have – typically relationships, hobbies, etc.

  • Finance Solver Oct 24, 2016, 10:00 pm

    Wow this is a great post. It’s so true. We often talk about things that we give up but never talk about things we gained, beyond money. A life of simplicity, comfort, and everything else that comes with it.

    I save a lot of money but I think I get a common misconception that my life must be significantly diminished as a result. Oh how I will prove the judging eyes wrong later on. I couldn’t be happier living a life of minimalism and taking out all the clutter in my life!

    • Distilled Dollar Oct 25, 2016, 5:59 am

      I’m all on board with the life of simplicity at the moment. It is funny how removing the clutter has helped me gain a clearer picture of what matters most in my life.

  • FinanceSuperhero Oct 25, 2016, 8:42 am

    Good thoughts, Matt. Tomorrow is promised to no one, so we may as well strike a balance and allow ourselves to live a bit in the present without robbing ourselves of a fruitful future.

    • Distilled Dollar Oct 25, 2016, 12:29 pm

      Yep! Luckily we can live in the moment — and build a better future — thanks to some frugal hobbies.

  • Colin @ rebelwithaplan Oct 25, 2016, 10:25 am

    One big thing I’ve learned is to not get caught up in constantly thinking and talking about saving rates and maximizing your dollars. It’s still important to do it, but don’t let your thoughts constantly drift to it. Think about other things.
    When I started making an effort to limiting my personal finance reading and budgeting to just once a week, I felt a lot more relief and ability to go out and do more! It’s been great so far!

    • Distilled Dollar Oct 25, 2016, 12:30 pm

      I’ve been caught there before, plenty of times! Moving it to once a week is real helpful. We tend to do a quick look together at the end of the month and a big look at the end of each quarter.

  • amber tree Oct 25, 2016, 2:00 pm

    We came to the same conclusion a while ago.
    We work with budget that allows us to do that. Everything else goes towards FIRE.

  • Cindy @ Smart Family Money Oct 28, 2016, 10:53 am

    I love this! Yes, both things are so important. I think this is especially true when you have children. I am keenly aware that I only have 10 years left with children at home, and I want to make the most of that time, while still working towards a solid financial future.

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