I have at times been a junkie for blogs on Financial Independence. But I often grow bored with them, and the people on one particular forum that I enjoy visiting frequently annoy me because so many of them are wholly dedicated to not spending any money. What, is spending money wrong? So you have these people excited to save $2 on something or happy that they didn’t part with, I don’t know, $7 for a burrito. There’s a much bigger picture to saving money that gets missed, and you don’t need to be a miser to accomplish big things.
Jacob Fisker over at EarlyRetirementExtreme, one of the most philosophical websites on the subject, describes this battle as “strategy vs tactics”. With strategy, you have an overall goal for what you are trying to accomplish in life and money. Tactics are simply how you go about this. There is no shortage of sites telling you how to do things, or at least how you ought to do things but very few sites encourage you to dig into why or the greater implications of what you are trying to achieve.
Not spending any money is rarely a strategy. What exactly are you trying to accomplish by not spending any money at all? But maybe your strategy, which can be thought of as a goal, is to be able to survive a layoff comfortably. Maybe it’s to reduce your consumer waste or your ecological footprint. Maybe it’s to not need to work so much so you can spend more time with your kids. Maybe it’s to not need to work at all. Tactics would be spending less on groceries, or coupon clipping, driving a smaller car or even going car-less. There is no shortage of tactics out there, but they will often rub somebody wrong, because not every tactic is well suited to every strategy. If you love driving and someone tells you that you shouldn’t be driving, you should be biking everywhere, well…”fuck you”, right? That would be a misapplied tactic, which probably misses your overall goals.
A strategy will also allow for rare and unexpected occasions. If your car develops a serious issue, you may have to dip into your savings to fix it. But if your plan is highly dependent on saving $X every single month, your plan may be trashed in this circumstance. A strategy, on the other hand means that perhaps you save as much as you can to reach your goal but it takes into account that sometimes unexpected things happen that may interrupt the flow of things, and that’s okay.
I’ll admit the distinct isn’t super clear. But another example may be weight loss. What often happens is that a person may eat more than they intended in a day, and at that point they caulk it up and eat as much as they want. This indicates a lack of a larger strategy, which may be something like eat less. If “going over” what you plan to eat results in you chucking the whole day, you aren’t exactly following the strategy, since your tactics just got defeated. It would be more in line with the strategy to accept that you ate to much, but to leave it there, and not continue to eat more. You hear this with people who believe saving money is good, but just because they accidentally binge shop, they just throw it all out. “Who saves, anyway?” They lacked a greater strategy.
So here’s my bigger message: if your goal is to reduce your spending and increase your savings, you should have a purpose for this. I would say that one of my greater purposes is to waste less while living a fulfilling life and building up toward financial independence. My general, guiding tactic is to spend more money on the things that bring me joy and less money on the things that don’t.
Too often, the message on these blogs is “don’t spend money”. But why not? Is spending money somehow bad? I think those people have simply gotten confused about the greater purpose. See, most of the waste we see in America is people chasing the thrill of new purchases. So you see two-car garages that can’t be parked in because they are full of unused stuff, which once served to excite their owners with novelty and opportunity, but now sits languishing in the cold.
In these cases, the money was wasted because those objects aren’t even being enjoyed; they’re doing nothing to improve the lives of their purchasers. And the purchasers are poorer for it.
Last year, I was tempted to buy a mountain bike. I had been jogging on several trails and noticed that the mountain bikers always had a massive speed/ground-cover advantage over feet, and I began to dream of how much more of these areas I could explore with a bike. But I was conflicted: I have hiking, snowshoeing, camping, jogging, and fishing gear. If I bought a mountain bike, it might be fun, but it also might make me feel guilty if I didn’t use it very often. It would also be awkward to store and require me to purchase a specialized rack for my car because I drive a mid-size sedan with no roof rack. Plus, it would mean I would be spending less time doing the other activities I already enjoy because my time would be even more spread out. So I ultimately decided that buying a mountain bike was inconsistent with my greater objectives of minimalism and getting maximum use out of the things I own, while also saving money. Now, some people can do all of those things and get great use out of them. That’s where you have to know and understand yourself well enough to make that call. And we’ll always make mistakes from time to time, but keeping these goals in mind has saved me enormously over the years: my overall strategy has worked well.
And this is where I think most people could really benefit. Are you a huge Apple fan? By all means, go ahead and buy a nice Mac. It’s okay. Just maybe don’t fill your life up with tons of other little gadgets you never use. Maybe you just absolutely love your daily $6 coffee. Great, focus on that and budget for it, but maybe bring a lunch to work instead of eating out. Maybe you love TV and video games. Buy a nice, high-quality television and game systems, but maybe avoid the forms of entertainment you never use. There’s no real right or wrong goals here. The trap is that people buy ALL OF THE THINGS, but never really use them. After all, our brains only have so much mental real estate for the things in our lives. I’m always amazed how hard it sometimes is to make use of new purchases, and I’ve been fairly focused on this stuff for the past decade!
If you make good money and years have passed and you have nothing but piles of things to show for it, take it maybe as an indicator that you haven’t been spending money the way you really want to. That’s okay, just get back up and make some changes going forward.
Let’s also talk about multi-use objects. As far as outdoor activities, my most frequent outings involve hiking and snowshoeing, and these share some key commonalities: hiking boots, pants, backpack, poles, and body cover. So if I do these activities frequently and get great enjoyment out of them, it makes sense to make sure they are quality. This past year I spent $260 on a pair of hiking boots. That may sound outrageous, considering you can buy a pair for $60-140 and still find quality. But these boots are the most comfortable I have ever worn. Ever. Totally worth it. I also have $100 hiking poles, which have served me dozens of times over the past several years since I bought them.
I also have quality snowshoes, though they are really only useful for 1-2 seasons of the year, but I sure enjoy them.
I have nice things for camping, but I’ve started to push back on these. This past year, I’ve only been camping once, and although it was the intention to camp more often, this was still the outcome. There’s systemic risk in the fact that not many of my closer friends really enjoy camping or have the proper gear to do it comfortably, and camping is predominantly a social activity. My fancy 0 degree backpacking sleeping bag cost almost $400, which is crazy, but it’s also the most comfortable sleeping bag I’ve ever owned, and it packs down really well. Ultimately, this purchase made sense given how miserable I’ve been in most of my sleeping bags in the past, but it means that I will not be investing in ultra-light weight versions of the other gear required for camping: my activity in this area simply does not indicate a need for those things. In other words, I’m not going camping enough for buying more expensive camping gear to make any sense. You could easily drop several thousand dollars on backpacking gear, but if you aren’t actually using it, that money is wasted! (next year! next year I must go camping more often!)
We all have trial and error to deal with. I got really excited about making my own bread for a time, and fortunately settled for a $5 Goodwill bread machine rather than a $100+ brand new bread machine. It’s been sitting in the corner of my office area for more months that I have kept track of or care to admit. And that, my friends, is the beauty of going cheap on things you don’t have a proven track record of using. That’s not always necessary, but it can be a smart choice when trying new things.
Quality means nothing unless you’re actually using the object.
Savings tactics mean nothing unless you have a clear objective you’re trying to accomplish.
This is why I don’t write boring lists of ways to save money. I don’t care. I’m not winning any frugality competitions. But I’m still well along toward reaching my goals.