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Finding the Balance Between Life and Money

How do you find the balance between living life and saving money? With this blog about saving money and increasing my net worth, it’s easy for me to get carried away and stop spending money on things that are enjoyable in life. For example, when my wife mentioned that she wanted to go on a nice (aka expensive) vacation this year, all I could think about was how much this vacation was going to cost and that vacations are a money pit! Isn’t money the means to buy the things that you enjoy? Perhaps financial freedom is more important to me than the material things that it can buy. But when is saving and financial planning considered excessive?

On the other end of the spectrum, I have so many friends who are around my age (27), and so deeply in consumer/student debt that it will take them at least 10 years to pay off at their current salaries, good salaries at that. Yet these same people still go out for lunch every day, party every weekend, and lease brand new cars every 2-3 years. To each their own, but in my opinion, this is the extreme in the opposite direction.

What is the solution? Where is the balance? Perhaps setting a savings goal for the year, setting up automatic withdrawals, and spending any excess money above savings on the things that make life enjoyable to the individual.

Enough with this philosophical rambling, time to get back to financial optimization. :) Until tomorrow…

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FT About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.

{ 17 comments… add one }
  • Luc March 26, 2007, 6:42 am

    When do you plan to enjoy your savings?
    If you plan to retire by 45, when your health should still allow you to lead an active vacation, then I think that it’s worth living a frugal life and working 16 hours a day by then.

  • FrugalTrader March 26, 2007, 8:52 am

    Hi Luc,

    I don’t have a planned retirement age YET. But I will stop the 9-5 office grind when I feel that i’m financially ready (aka. as soon as possible). :)


  • Jon Lee March 26, 2007, 9:29 am

    People in debt and are financially irresponsible really irritate me. I knew so many people that complained about being in debt or having no money for food because of university tuition – only to spend a couple hundred dollars every week on alcohol…

  • j&w March 26, 2007, 11:22 am

    I have no problem being cheap on the small stuff but good, experience-rich vacation is a must in our household. I actually work with people who don’t even take their vacation time so they can receive pay for that time instead. They’re out of their minds.

  • Investoid March 26, 2007, 12:13 pm

    My wife’s a travel bug (and I must admit I like to as well), and we plan at least one major vacation every 12-18 months. I personally think it’s important to enjoy life now while ensuring you’re not suffering as a result later.

    As with all our expenses, we have a monthly budget that can be spent periodically or saved up for larger purchases. We’ve also decided to make extra income for things we want that are outside our budget or that we want sooner. We’ll never to get anything quicker though.

  • FrugalTrader March 26, 2007, 1:24 pm

    Investoid: I like that “enjoy life now while ensuring that you’re not suffering as a result later”. Good way to live.

  • Causalien March 26, 2007, 1:49 pm

    I too faced this dilemna. It’s a delicate balance between enjoyment now and enjoyment in the future.

    The answer came to me when I reached the conclusion of what my purpose in life is (by sitting down for 30 minutes and write down everything I think could be a life purpose until one of them put tears in my eyes.)

    With that in mind, I then understand what are opportunities that will need to be paid for now and what can be saved till later.

  • Canadian Dream March 26, 2007, 7:53 pm


    Good topic. I think you hit the balance point when you realize you have “enough” of anything. Enough to be happy yet not too much to be a problem.

    Then something will happen and you will find yourself off that balance point again. For example, my wife is starting to understand that I’m serious that I want to stop working at 45. So she mentioned that she wants to travel more in retirement. I estimated that little remark added $60,000 to the savings target.

    O well back to numbers again.


  • Clayton March 26, 2007, 8:27 pm

    My wife and I have had that conversation countless times. Starting out with nothing, we are on track to be financially free at a very young age but sometimes we struggle to maintain focus. Usually only one of us struggles at a time so the other one is around to help refocus. When we’re struggling we talk about our current quality of life compared to even 2-3 years ago and realize that we are still living a quality of life much higher than we thought we would at our age (28) and we do so with no debt, 2 older cars paid off, some solid investments, etc. We make it a point to take a nice vacation every year and that big vacation memory keeps us going…you dont remember the 3-4 lunches per week you buy so we skip those and pack our own, but the trips to mexico, or kayaking off of Vancouver Island…those we talk about and are worth every cent. It’s about priorities…live life but skip the inconsequential filler.

  • David March 26, 2007, 10:24 pm


    Don’t forget that life can toss all sorts of impediments in your path. Carpe Diem — a term as old as history itself, should not be forgotton. Don’t spend so much time worrying about the future, as it may never come, take time to enjoy youth while you still can. Enjoy the unspoilt before some one spoils it. Ski while your knees are still solid, see the ends of the earth before your kids fill your lives with new joys. Put a little aside for a rainy day, (or for retirement :-) ).


  • Jon Lee March 26, 2007, 11:02 pm

    @Clayton You and your wife are a great role model that a lot of people can learn from!

  • Q Cash March 27, 2007, 12:28 am

    One of my wife’s requirements early on (in the pre-marital discussions) was that she wanted to have at least one nice (Read all inclusive) vacation a year. She made the comment when we were looking at houses because, being the wise and frugal one, she did not want to buy a monster house with a huge mortgage so we couldn’t afford to travel.

    Both she and I enjoyed travel as part of our single days and wanted to continue.

    As I contemplated “early retirement”, my wife again reminded me of her requirement for one nice vacation a year and that we would have to allow for those costs. With two kids, the destinations may have changed, but the goal remains the same.

    My goal is to have two nice vacations a year. One to a sunny destination in the winter (just about the time seasonal affected disorder kicks in) and one in the fall (albeit a driving vacation to somewhere we haven’t been before).

    So far, we have managed the first one this year, and have plans for another in October.

    I agree with the comment above about remembering the holidays, not remembering the purchased lunches.

    We are frugal with our everyday spending so we don’t sweat the big purchases for the quality of life stuff.


  • FrugalTrader March 27, 2007, 7:59 am

    QCash, when you get the chance, can you send me an email? webmaster at milliondollarjourney.com

  • Canadian Money March 28, 2007, 4:51 pm

    There is no perfect way or right answer…there is only my/your preferred way.

    If were lucky we find a good balance between spending and saving. The energy of youth disappears over time. We can only do some things when were still young enough. When I was young I borrowed money for my first few cars.

    I will always remember driving that 1968 Firebird on the beach at Long Beach with two wheels in the water. Can’t do that anymore.

    I borrowed money to take flying lessons. My first date with my wife was an evening flying a rented two seater plane. I now have bragging rights!

    I think we should all aim for a “good balance” however each of us define that.

  • Tommy July 9, 2007, 12:25 pm

    FT, your idea of spending excess money above savings and bills is exactly how I plan to go about things once I start work. What I have left over monthly will either be spent immediately or saved for larger purchases.

    My reasoning is that I’ve spent so many years working hard in school to put myself in position so that I could afford to save for my future while still getting to enjoy the hobbies I want.

    That being said, I also think there are some ways to minimize the cost of your hobbies without sacrificing enjoyment.

    1. Consider a hobby’s cost cost to enjoyment ratio

    Every hobby has a certain cost associated with it and a certain amount of enjoyment for a particular individual. When thinking about a new hobby, why not consider this? If Hobby A is a costs far less and is almost as enjoyable as Hobby B, why not choose Hobby A! But on the flip side, if Hobby B is more expensive than Hobby A but far more enjoyable, don’t deprive yourself! Choose Hobby B.

    2. Upgrade yourself before you upgrade your equipment

    A trap that many people fall into with their hobbies is buying bigger and better gear (upgrade-itis) in order to make them better at their hobby. While it’s true that better gear often means better performance, more often than not, improving on fundamentals will make more of a difference while costing much much less. Learn your hobby!

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