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Paycheck to paycheck is a horrible horrible nightmare... even when it isn't.
I admit, I look at savings as an expense. For me, it is my biggest expense. This is probably the wrong way to look at it because it creates an emotional tension where you feel like you are short on money, but you are in fact saving adequately and SHOULD be spending the rest of it to enjoy the present.
I'm going through this dilemma and am trying to train myself to think differently. This is my best effort thus far.
I see the benefits of money as a weird equation/relationship between future and present value. I used to weigh everything toward the future because of this magical thing called compound growth/interest. Every dollar in the future was ALWAYS better than a dollar today. But that dollar needs to be converted into something. I believe it buys quality of life. Saving now definitely increases quality of life in the future. The more time to compound, the greater the improvement, however there reaches a point where the returns on the future start declining because you've accumulated too much and cannot spend it all. At this point it starts becoming less beneficial to save if you are sacrificing enjoyment in the present. The key is to find that balancing point. It will constantly shift as you gain/use/lose money, but it is important to have some sort of framework for evaluating how to spend your money.
I'm sure I said the same thing as everybody else, but in a different way. To try to tie it all together - I think it is fine to have a paycheck to paycheck mindset because it ensures that you don't spend more than you earn, however there are negative consequences such as stress so it is important to change the way that we respond to the paycheck to paycheck lifestyle. If we follow a decision process that ensures that we "spend" adequately on savings, everything will work out. Whether or not that works out is a whole other discussion...
Hope that helps.
I admit, I look at savings as an expense. For me, it is my biggest expense. This is probably the wrong way to look at it because it creates an emotional tension where you feel like you are short on money, but you are in fact saving adequately and SHOULD be spending the rest of it to enjoy the present.
I'm going through this dilemma and am trying to train myself to think differently. This is my best effort thus far.
I see the benefits of money as a weird equation/relationship between future and present value. I used to weigh everything toward the future because of this magical thing called compound growth/interest. Every dollar in the future was ALWAYS better than a dollar today. But that dollar needs to be converted into something. I believe it buys quality of life. Saving now definitely increases quality of life in the future. The more time to compound, the greater the improvement, however there reaches a point where the returns on the future start declining because you've accumulated too much and cannot spend it all. At this point it starts becoming less beneficial to save if you are sacrificing enjoyment in the present. The key is to find that balancing point. It will constantly shift as you gain/use/lose money, but it is important to have some sort of framework for evaluating how to spend your money.
I'm sure I said the same thing as everybody else, but in a different way. To try to tie it all together - I think it is fine to have a paycheck to paycheck mindset because it ensures that you don't spend more than you earn, however there are negative consequences such as stress so it is important to change the way that we respond to the paycheck to paycheck lifestyle. If we follow a decision process that ensures that we "spend" adequately on savings, everything will work out. Whether or not that works out is a whole other discussion...
Hope that helps.
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