Frugality vs Living Life-Where do you draw the line?

[sireki]

I would like to know the opinions of the fellow BHs on this matter.
Let me give you some examples of my family
1. My Dad - Lived very frugally, owned his business, saved more than enough for retirement and died of sudden heart attack at 62 yrs of age. Mom has a lot of money but can't spend it now because she doesn't feel like it. Her regrets - when she wanted to spend on 'kids, clothes, travel' etc. in their youth, she couldn't as dad didn't let her and now she doesn't have any wish to spend beyond basic necessities.
2. My Uncle - Lived extremely frugally, is retired, has a net worth of more than 100 times his annual expenses but wouldn't let my aunt spend money on domestic help or other things that would be 'luxury' in his eyes but would add comfort. Wouldn't buy a flight ticket and drive for vacations etc. Wouldn't travel in a business class when traveling internationally etc. All of his kids are well-settled and don't need any money from him, but he can't make himself use his own hard earned money for himself and his wife.

So, my question is where do you draw the line and decide that is my frugality stopping me from living. Does the 'high' I get from seeing my net worth grow stop me from living life? If yes, then how do you decide. I am very frugal by nature, but DH likes to enjoy life and values comfort over saving money by comp-shopping/coupons etc. He believes that this is the age when we should live life a little bit because who knows how healthy we will be when we retire. We certainly aren't spending more than we make and we have diligently saved for retirement and other life needs but I still would love to save more and he would love to enjoy life.
My next question is - What are your suggestions on finding the balance? At what point does frugality become counter productive ?

 

[Lou]

Hi.
Drawing conclusions from examples - I can't remember but there is a name for that.
Your examples seem to be too extreme. which is ok I guess because I'm pretty sure the
"answer" is more moderate.
Everything in moderation, including moderation.

Anyway... there is actually a field of finance is dedicated to answer questions like yours.
Like most academic pursuits you can get a PhD or just get a survey course.

However your examples hinge more on psychology. Obsession, compulsion seem to be the important factors.

Anyway, totally ignoring the psychology, people who study finance have some pretty good rules of thumb.
One good one is the 50/30/20 rule. It says that 50% of your earnings should go to necessities, 30% to discretionary items and 20% to savings.

There is also a 70/20/10 rule.
70%, goes towards living expenses while 20% goes towards repaying any debt, or to savings. And 10% for having fun.
The two rules aren't really all that different.

Keeping close to these guidelines is probably the balance you are looking for.

 

[Andy_T]

Hello @sireki , welcome to the forum.

Interesting question you pose.

I would say that the example of your uncle is definitely crossing the line - first of all, that his wife is not allowed to spend „his“ money ???

Did he earn it all by himself? And, if so, what did his spouse do? If a couple decide they should live on one salary and one of them should dedicate their time to making a home / raising the children, how is that not a contribution that should be seen as equal to earning the money? She definitely should have a say in what to spend the money on, you can’t take it to your grave with you…

To be honest, I’m not a fan of people with such toxic beliefs…

 

[Emma JC]

agree with @Lou

balance, moderation....

Emma JC
Find your vegan soulmate or just a friend. www.spiritualmatchmaking.com

 

[Daniel Swords]

I would like to know the opinions of the fellow BHs on this matter.
Let me give you some examples of my family
1. My Dad - Lived very frugally, owned his business, saved more than enough for retirement and died of sudden heart attack at 62 yrs of age. Mom has a lot of money but can't spend it now because she doesn't feel like it. Her regrets - when she wanted to spend on 'kids, clothes, travel' etc. in their youth, she couldn't as dad didn't let her and now she doesn't have any wish to spend beyond basic necessities.
2. My Uncle - Lived extremely frugally, is retired, has a net worth of more than 100 times his annual expenses but wouldn't let my aunt spend money on domestic help or other things that would be 'luxury' in his eyes but would add comfort. Wouldn't buy a flight ticket and drive for vacations etc. Wouldn't travel in a business class when traveling internationally etc. All of his kids are well-settled and don't need any money from him, but he can't make himself use his own hard earned money for himself and his wife.

So, my question is where do you draw the line and decide that is my frugality stopping me from living. Does the 'high' I get from seeing my net worth grow stop me from living life? If yes, then how do you decide. I am very frugal by nature, but DH likes to enjoy life and values comfort over saving money by comp-shopping/coupons etc. He believes that this is the age when we should live life a little bit because who knows how healthy we will be when we retire. We certainly aren't spending more than we make and we have diligently saved for retirement and other life needs but I still would love to save more and he would love to enjoy life.
My next question is - What are your suggestions on finding the balance? At what point does frugality become counter productive ?

Read A Christmas Carol. It is not just a pleasant Christmas story to be read to children during the holiday. The Christmas theme serves as an analogy for how much happier and peaceful people and societies could be if they practiced the spirit of kindness, benevolence and goodwill all the year. The pathway to happiness is not through having more or better stuff and greater self-indulgences, it is through practicing kindness, benevolence and goodwill and shared-indulgences. Emulate the before Christmas minimalism and the after Christmas kindness and benevolence of Ebenezer Scrooge.

 

[LoreD]

I would like to know the opinions of the fellow BHs on this matter.
Let me give you some examples of my family
1. My Dad - Lived very frugally, owned his business, saved more than enough for retirement and died of sudden heart attack at 62 yrs of age. Mom has a lot of money but can't spend it now because she doesn't feel like it. Her regrets - when she wanted to spend on 'kids, clothes, travel' etc. in their youth, she couldn't as dad didn't let her and now she doesn't have any wish to spend beyond basic necessities.
2. My Uncle - Lived extremely frugally, is retired, has a net worth of more than 100 times his annual expenses but wouldn't let my aunt spend money on domestic help or other things that would be 'luxury' in his eyes but would add comfort. Wouldn't buy a flight ticket and drive for vacations etc. Wouldn't travel in a business class when traveling internationally etc. All of his kids are well-settled and don't need any money from him, but he can't make himself use his own hard earned money for himself and his wife.

So, my question is where do you draw the line and decide that is my frugality stopping me from living. Does the 'high' I get from seeing my net worth grow stop me from living life? If yes, then how do you decide. I am very frugal by nature, but DH likes to enjoy life and values comfort over saving money by comp-shopping/coupons etc. He believes that this is the age when we should live life a little bit because who knows how healthy we will be when we retire. We certainly aren't spending more than we make and we have diligently saved for retirement and other life needs but I still would love to save more and he would love to enjoy life.
My next question is - What are your suggestions on finding the balance? At what point does frugality become counter productive ?

I think we can differentiate between frugal and cheap. Frugal is carrying a thermos of coffee to work, rather than buying a cup at Starbuck's. Cheap is buying super crappy coffee that you don't like, just because it was the cheapest.

My daughter loves to go to an apple festival every year, and the minimum hotel room prices jump to $300-500 per night. She either rents a campground site (sleeps on a mattress in the back of her SUV) that has showers and bathrooms, or rents a hotel room about 45 minutes away ($100 per night). She is frugal. Cheap would be not going to something you enjoy just because it would cost you ANY money.

I remember working as a caregiver for very wealthy family when I retired. She had late stage Parkinson's. The husband viewed himself as being really frugal when he was just cheap. They had long term care insurance. He said she didn't get anything if it wasn't paid for by insurance. He wouldn't buy a $5,000 stair lift because we were "paid" to muscle her up the stairs. She didn't have a motorized lift chair, walk in shower, hospital bed, or ramp down exterior stairs. Anything that cost money. When it got to the point she was too frail to live in the house without making these changes, he moved them into an apartment; even though she had lived in the house for 50 years and wanted to die there.

Frugal living is deciding which things bring us enjoyment, and investing in those things, rather than buying mountains of stuff. Many people live frugally in order to be able to travel, or retire early. Cheap is just hoarding money.

 

[Lou]

I think we may need some other words besides frugal and cheap.
I'm imagining one of the x-y graphs. the x-axis is how much money you spend. Less money is to the left. the y-axis is how smart you are with your money. smarter is higher.
The guy with the thermos is in the top left quadrant.

 

[silva]

I would like to know the opinions of the fellow BHs on this matter.
Let me give you some examples of my family
1. My Dad - Lived very frugally, owned his business, saved more than enough for retirement and died of sudden heart attack at 62 yrs of age. Mom has a lot of money but can't spend it now because she doesn't feel like it. Her regrets - when she wanted to spend on 'kids, clothes, travel' etc. in their youth, she couldn't as dad didn't let her and now she doesn't have any wish to spend beyond basic necessities.
2. My Uncle - Lived extremely frugally, is retired, has a net worth of more than 100 times his annual expenses but wouldn't let my aunt spend money on domestic help or other things that would be 'luxury' in his eyes but would add comfort. Wouldn't buy a flight ticket and drive for vacations etc. Wouldn't travel in a business class when traveling internationally etc. All of his kids are well-settled and don't need any money from him, but he can't make himself use his own hard earned money for himself and his wife.

So, my question is where do you draw the line and decide that is my frugality stopping me from living. Does the 'high' I get from seeing my net worth grow stop me from living life? If yes, then how do you decide. I am very frugal by nature, but DH likes to enjoy life and values comfort over saving money by comp-shopping/coupons etc. He believes that this is the age when we should live life a little bit because who knows how healthy we will be when we retire. We certainly aren't spending more than we make and we have diligently saved for retirement and other life needs but I still would love to save more and he would love to enjoy life.
My next question is - What are your suggestions on finding the balance? At what point does frugality become counter productive ?

First off--what are "BH"'s?
It strikes me that your dad and uncle are cheap rather than frugal. Frugal is getting the most for your money, not going without.
It's hard for many to know how much they should spend on wants, caught between feeling the need for a 6 month emergency fund and a culture of "treat yourself"
Every time I think about vacations or any kind of fun spending I start adding up all the projects my house needs, or what I'll do when my card needs repair (or replaced).
On the other hand, I have spent on my wants more now than when my kids were young.
So many things, esp health related, can wipe out saving in an instant, and particularly in the US, there is no help until you are completely ruined.

 

[LoreD]

I remember watching a series of YouTube videos chronicling a woman fighting a shopping addiction. She had a very a large income, which meant she was addicted to buying incredibly expensive designer clothing, handbags, and shoes. She had been in a 2 year relationship with a man she really liked. He told her he felt uncomfortable moving on to more a serious (marriage) relationship because of her shopping addiction.

Her sister told to add up on her credit cards how much she was spending on individual items. She found out she had spent $70,000 on handbags, and another $100,000 on shoes, clothing, and accessories. All within 1 year. Most of the stuff was still sitting in a room with the sales tags.

It broke the addiction when she realized she would rather have the nice guy, rather than all the stuff.

Every time she would get an urge to look through designer handbags; she would write down the price, and look through travel sites to see how much that handbag was worth in travel. That $7,000 handbag could buy her 2 weeks at a high end resort in Fiji, Paris, or wherever. She could see something that she really wanted more than the handbag. At the end of the year, she, and her boyfriend, picked out 1 handbag's worth of vacation, and posted the vacation video.

I watched the video of her packing up all of the designer stuff to go to a resale shop, and breaking down all of the "display" cases. She turned the "hoard" room into a yoga and meditation room.

 

[Mufflon]

First off--what are "BH"'s?

In Germany BHs are something you're holding up your boobs with.

 

[Lou]

In Germany BHs are something you're holding up your boobs with.

boob holsters?

 

[silva]

In Germany BHs are something you're holding up your boobs with.

Were they calling us fellow boobs?

 

[silva]

Such difficult line to walk when you take on other people to care for as opposed to just yourself.
When I was young with kids I felt I couldn't afford to contribute to the companies matched 401K, so I lost tens of thousands of what would have bee free money all those years. I'm now contributing with my kids grown, but see my peers who've had the same salaries quite financially sound!
In US (what I know), life is truly designed to keep people in the channels they're born to.

Really have to spend enough to feel what you work for is worth more than just getting by while not making it harder to get by

My favorite splurge was my latex bed pillow. My son, who doesn't think twice to get what he wants, bought a far more expensive Purple pillow and I found it to be just what I needed! Best $70 spent and I thought it was crazy!
ETA: I didn't buy the Purple pillow-that was like $140! I bought a latex pillow from amazon

 

[Mufflon]

boob holsters?

That sounds less boring than "bra", lol.

A "BH" is a "Büstenhalter", hehe.

 

[PTree15]

Such difficult line to walk when you take on other people to care for as opposed to just yourself.
When I was young with kids I felt I couldn't afford to contribute to the companies matched 401K, so I lost tens of thousands of what would have bee free money all those years. I'm now contributing with my kids grown, but see my peers who've had the same salaries quite financially sound!
In US (what I know), life is truly designed to keep people in the channels they're born to.

Really have to spend enough to feel what you work for is worth more than just getting by while not making it harder to get by

My favorite splurge was my latex bed pillow. My son, who doesn't think twice to get what he wants, bought a far more expensive Purple pillow and I found it to be just what I needed! Best $70 spent and I thought it was crazy!
ETA: I didn't buy the Purple pillow-that was like $140! I bought a latex pillow from amazon

(Bold emphasis mine). I do agree with that. It's very hard to get ahead in some respects if you didn't have a good leg up to begin with. I, too, couldn't really afford to contribute early on to 401(k) plans, as I just didn't earn nearly enough to be able to save, despite my not having any children to worry about. I barely made the bills with what I did take home, so putting some aside just wasn't possible back then.