A good question

[reptile411]

For those of you that have adapted to live with maximum income and minimal needs. Do you find it hard to be frugal when the 0's start to add up in your bank accounts? I know I do. Every now and then I get an itch and say whats the point in earning it if I cant spend it but keeping in mind to never spend more than I earn, that's what gets you in trouble. I just wander how many other out there are like that? I mean if you have 980,000 in savings, Taking a couple hundred out to treat yourself isn't a big deal you know?

[GREENBACK]

You absolutely should trreat yourself once in a while. If you focus on being frugal and saving every last dime and never spending anything you'll burn out on it sooner or later ( at least I would). If you have 980k I wouldn't get real concerned about blowing a few hundred dollars.

[sweeps]

I agree with GB that you need to reward yourself now and then. You can't take it with you, right?

But I think one way to avoid the problem you're talking about is to segment your money. If you keep all your money in one checking account, it's easy to look at a $100k balance and spend a little here, a little there. Move the excess money to a CD or a savings account elsewhere. That way you're not looking at a gigantic balance every time you look at your checking acct.

[reptile411]

Thats exactly what I did. I could not save a penny to save my life when I kept it in my Savings account that is linked with my checking account so I opened 2 high yield savings accounts with other institutions "ING and HSBC" and the bulk of my money stays in those accounts.

[disneysteve]

As our income has grown over the years, we've upgraded our lifestyle in various ways, but have always done so with only a portion of the higher income, saving the rest. That way, we feel like we're getting ahead and living better than before, but at the same time, we're also saving more than before.

For example, if my income went up by $100/month, I'd increase savings by maybe $75/month and increase spending by $25/month. I've done the same when we've paid off debts. When I finished paying my student loans, I hired someone to mow the lawn. I pay them $54/month but my student loan payment was a few hundred/month. The rest went to savings. When we paid off another loan ($150/month), we got cable TV ($11/month).

[reptile411]

Thats not a bad plan. I did the exact opposite. When my income from my 9-5 nearly tripled I got the wife a new car, cell phones, refurnished the house and got the DVR, had 2 kids and eventually purchased a house. We realized we live very good but what happens if the good jobs end? We have nothing in savings and some low performing investments. Basically we stood to loose everything we worked for witch is why I dropped all my hobbies. I had about 6 hobbies that ran me a few hundred a month each easy. Now my biggest hobby is trying to have as much extra money as I can and I only kept one long term hobby witch I converted to a business and makes us even more money now. The wife still drives the new car "3 years old now" but I drive my 30 year old Toyota and leave the SUV parked at home most times, I use to eat out every day but now we goto dinner as a family every Monday night, Got more picky about what we buy at the grocery store but there is one thing that has saved us more money than anything........ wait for it,,,,........ wait for it........ I no longer go shopping with her LOL Now she dose the grocery shopping without me It was not uncommon for me to spend 1-2K on "Toys" while she ran around getting food. Now I stay at home and work in the garden or clean out the pond while she dose the shopping and guess what? We save 1-2K every other week now lol go figure.

[GREENBACK]

Sounds like you're going in the right direction. Spending should be planned just as saving is planned. Have a plan for fun spending. Once you know what you can spend on fun.....spend it! It makes the whole saving thing much easier than pinching every penny.

[arthurb999]

you need some "blow" money every month... and a big purchse paid for in cash (like a sweet tv or computer) is ok.

[Ima saver]

We allow ourselves a few treats every once in a while. We got new chairs this month and will get a new breakfast set next month!

[reptile411]

Tell ya what. Buying a house was a HUGE saver for us as well. I am so worried something will go wrong "even though it insured and we purchased a warranty" that I put every penny away just in case the roof leaks lol. I always had a balance on my credit cards but now they are at zip just waiting to be used on that rainy day. I will be the big hero for being able to have the roof fixed the same day it leaks. I still have to get it through my head though that its a brand new 30 year roof LOL

[myrdale]

I give splurging the same view as I do Taco Bell and getting hit by a bus. Yes I know I should not eat Taco Bell. But it would be a crying shame if I got hit by a bus this evening and my last meal wasnt Taco Bell. With that logic, I dont get it alot, but I do every couple of weeks. The same for the spending. I don't have a written budget but I do alocate a few pennies ($50-200) each month for blow money. Last month it was a pump book. The month before was an IPod. This coming month, I am considering replacing 3 more windows I should have done when I did my others. And I allow myself 1 or 2 large items ($500-1000) a year. Windows were the splurge this year, a TV last year, fishing gear the year before, and a computer the year before that.

Ofcourse, I sometimes wonder how skinny I would be if I'd never eatten Taco Bell at all, but I know I would not be nearly as satisfied as I am right now!

[kork13]

Originally Posted by myrdale

But it would be a crying shame if I got hit by a bus this evening and my last meal wasnt Taco Bell.

Wow, that's definitely a.... different.... perspective. Personally, just thinking about Taco Bell makes me feel ill and physically shudder--very bad/disgusting experience with them once upon a time. But hey, to each his own...

[reptile411]

Originally Posted by myrdale

I give splurging the same view as I do Taco Bell and getting hit by a bus. Yes I know I should not eat Taco Bell. But it would be a crying shame if I got hit by a bus this evening and my last meal wasnt Taco Bell. With that logic, I dont get it alot, but I do every couple of weeks. The same for the spending. I don't have a written budget but I do alocate a few pennies ($50-200) each month for blow money. Last month it was a pump book. The month before was an IPod. This coming month, I am considering replacing 3 more windows I should have done when I did my others. And I allow myself 1 or 2 large items ($500-1000) a year. Windows were the splurge this year, a TV last year, fishing gear the year before, and a computer the year before that.

Ofcourse, I sometimes wonder how skinny I would be if I'd never eatten Taco Bell at all, but I know I would not be nearly as satisfied as I am right now!

LOL I have purchased 3 computers this year. A desktop and 2 laptops. Not sure why. Its not like I use them all at once, wait yes I do. When doing my stock trading I have all three doing or viewing something different. I got the desktop because I needed a new one, my last one blew up. I saw the 17" wide screen laptop while at the store and could not help it so I got them both "$1,400 good bye" Then I found one of these Acer Aspire One netbooks and just had to have it lol.

[reptile411]

Originally Posted by kork13

Wow, that's definitely a.... different.... perspective. Personally, just thinking about Taco Bell makes me feel ill and physically shudder--very bad/disgusting experience with them once upon a time. But hey, to each his own...

No pun intended but the thought of Taco Bell makes me want to get hit by a bus.

[MonkeyMama]

The premise of the original post assumes buying material goods is more desirable than financial security. Having had both, I rather have the money in the bank. It gives tremendous peace of mind.

The second thing is we have specific goals for our money. So, if I have $980k in the bank (which I could see, for retirement) I would not be tempted to spend it because I would probably rather be able to retire some day. Of course, if there is something I do want to buy, then I would save up for that too. Balance is really key.