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At the risk accused of heresy, Iâ€™d like to open up a discussion of — for lack of a better description — frugalityâ€™s darker side. True, most of us have room for more frugal in our living and spending habits, but is it possible to take things to the point of being counterproductive?
Can we be honest? Free spending is usually about convenience; there may be a cheaper alternative, but we buy whatâ€™s convenient so we donâ€™t have to spend time investigating our options. We often justify paying the going rate with the fact that weâ€™re saving time.
As toxic as this approach might be to our budgets, we have to acknowledge the reality that being frugal will in most cases involve a trade-off between time and money. We may have to spend more time shopping, clipping coupons, negotiating, fixing things ourselves, etc. that free spenders mostly ignore.
But how much time should we spend on this?
A real opportunity cost
None of us should make frugality so central in our lives that we spend inordinate amounts of time cutting expenses. If we do, we risk reducing the time available for earning more money, either through primary jobs, side ventures, or learning new skills that increase our earning potential.
For example, if you spend your spare time fixing whatever breaks in your house or on your car, it might be difficult to find the time to run a side business, take on a part time job, or enroll in computer or foreign language courses. In other words, you might be missing out on numerous opportunities to increase your income.
The earning-versus-saving conflict could be a case of “six of one, half a dozen of the other,” but earning capacity should generally take precedence over saving money, if only because there’s a limit to how far you can cut expenses. Earning more money, on the other hand, has no ceiling (at least in theory).
Making ourselves miserable
Part of sound money management is being more deliberate in our spending habits. That largely means putting limits on how much we spend for each expense category, but… If a budget is too tight, we can start feeling trapped.
Since most of us donâ€™t do captivity well, itâ€™s best to budget some money for letting loose and being frivolous from time to time. Itâ€™s far better to do that than to let frustration build to a level at which we abandon our budgets entirely. Managing emotions is just as important as managing money.
Taking unnecessary risks
No effort at being frugal is worth endangering yourself. So why is it that people are sometimes so consumed by the desire to save money that they do things like performing major home repairs that should be left to INSURED professionals.
Maybe you can fix that leak in your roof, but what if you fall off, get injured, and canâ€™t work for six months, how much money have you saved? Do what you can within reason to save money, but never ignore the risks that you’re taking in the process. Some expenses may not be worth cutting.
Making others miserable
Do you know anyone who makes a scene when whenever they open their wallet? Iâ€™ve been in restaurants with people who insist on a single check, and then do a Jekyll-and-Hyde routine when the bill arrives. Out comes the paper, pen, and calculator, followed by “friendly” disputes with others in the party as well the wait staff.
“I didnâ€™t order this… I only ordered one of that and you charged me for two… I didnâ€™t order a salad, I shared her salad…”
And so on. They’ll even go so far as talking down the tip due to alleged poor service.
Here’s a tip for you… If going to a restaurant isnâ€™t in your budget, donâ€™t go. If your budget is limited, ask for separate checks. Donâ€™t let your budget come between you and others.
Relationships with family and friends should be reciprocal — you give and you get. You donâ€™t want a reputation as the one who is first in line when itâ€™s time to get, but who quietly slips to the back of the line when itâ€™s time to step up and give.
Such people are difficult to be around, and the one thing you need when youâ€™re trying to save money is friends. While good friends don’t cost anything. they’re hard to find. Donâ€™t take advantage of them.
Crossing a forbidden line
I think we can all agree that we need to be on the lookout for different ways to save money. That being said, we shouldn’t take it to the extreme and use frugality as a justification for outright theft, either.
Examples include “everybody does it” activities such as theft of employer office supplies, taking handfuls of condiments from restaurants, exaggerating hours worked, fudging expense reports, or taking things under the “finder’s keepers” rule.
Balance should be the key in all that we do in life. We can and should work to save money, but we need to balance that effort against the costs we may incur in other areas of our lives.
What do you think?
How far is too far? Can efforts to save money have the opposite effect?
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