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While there is no such thing as a “magic formula” for building wealth, living below your means is by far the closest thing. When you spend less than you earn and save the rest, you will build wealth — and savings — by default. And, if you just so happen to invest that money and avoid debt in the process, you can even grow rich over time.
But, there is definitely a balance to be achieved when it comes to spending less than you earn. You definitely want to hit your savings goals, but you have to live, too. And sometimes, finding a happy medium can be extremely hard — especially if you’re living frugally in order to save for a home or pay off soul-sucking credit card debt.
Five Smart Ways to Beat Frugality Fatigue
The reality is, too many people who embrace frugality to improve their finances take on too much too soon and end up burning out. They approach frugality as if it were an “all or nothing” scenario, and they forget there are different shades to frugal living and a lot of levels in between extreme frugality and negligent overspending.
If you’re struggling from frugality fatigue or just trying to find a balance, here are some tips that can help:
1: Set up targeted savings accounts for specific goals.
If you’re living frugally so you can save a larger percentage of your income, saving without a tangible plan can get extremely old. This is especially true if you’re saving for a goal that could be a decade or more away — like retirement. Saving month after month without any reward can be boring when you don’t get to enjoy the fruits of your labor for a long time.
To help ward off this type of frugality and saving fatigue, it can help to set up targeted savings accounts for different goals. Maybe you want to retire early and travel, but you also plan to remodel your kitchen once your kids leave the nest. In that case, setting up a few targeted savings accounts for your home remodeling project and future travel lifestyle could add enough substance to your savings plan to keep you on track.
2: Create a slush fund.
Maybe your savings goals are totally reasonable, but you’re just tired of the frugality grind. You’ve been bringing lunch to work, making coffee at home, and avoiding the mall like the plague, and you’re desperate to have some fun.
Even if you’re trying to pay down debt or save up for a big goal, it can make sense to have a slush fund you can spend however you want. If you reward yourself with the occasional “want” and still hit your goals, you may be able to keep up with your frugal lifestyle for a longer stretch of time — and maybe even forever.
3: Embrace a new style of budgeting.
There are several different budgeting methods to consider, and each one has their pros and cons. If you’re on a bare bones budget that doesn’t allow for any extras, for example, it may be time to switch to a new strategy that leaves you with some wiggle room each month.
One type of budget we advocate for here is the zero-sum budget. This type of budget can be extremely effective because it forces you to “give every dollar you earn a job.” However, zero-sum budgeting can also be extremely flexible since it lets you create any budget categories you want. So, if you wanted some freedom to spend on fun each month, you could just add a “miscellaneous” or “fun money” category to your zero-sum budget.
Another budgeting method that’s fairly flexible is the 50-30-20 budget, also called “proportional budgeting.” With this strategy, you would spend 50 percent of your income on needs, 30 percent on “wants,” and 20 percent on savings. This type of budget gets you away from restrictive spending categories and still helps you save 20 percent of your earnings.
You may not reach your goals quite as fast if you embrace a looser style of budgeting or start setting aside some money for fun, but you will have more freedom in how you spend each month. If you want to live frugally for the long haul, it needs to be sustainable, and having some freedom can make all the difference.
4: Loosen the reins for a while.
Taking a break for a while can also make sense — but only if you know you can get back on track. If you’ve been living on a bare bones budget long enough that you’re starting to reach some of your goals, taking a weekend or week off to live how you want won’t be the end of the world.
Maybe you want to plan a quick family getaway, or perhaps you just want a week where you can go out to eat and not cook from scratch at home. Maybe your kids have gone without long enough that you just want to treat everyone to dinner and a movie. Whatever it is you or your family needs, there’s nothing wrong with loosening the reins to a certain extent. Just make sure you don’t go overboard and that you’re prepared to get right back on the wagon, and you should be fine.
5: Look for ways to earn more money.
Finally, don’t forget that there’s another path that can help you save more money without living on less. By earning more money, you can free up more cash to use towards goals like debt repayment, saving up to buy a home, and retirement. There are all kinds of ways to boost your income in your spare time, including part-time or seasonal work.
Whatever you decide to do to earn cash in your spare time, make sure you put that cash to work. Use it toward your savings or debt repayment goals — or use it for fun so you can continue using your regular income to get where you want to be without feeling deprived. Earning more money will always leave you better off provided you put your extra funds to use.
Finally, you should know that even inherently frugal people can grow tired of their lifestyle sometimes, and that’s totally understandable. It takes a lot of self-discipline and fortitude to go against the grain and save money in a world where most people are doing the exact opposite with their money.
Sometimes setting yourself up for success means knowing you can’t be perfect every minute of every day. If you’re suffering from frugality fatigue, a little break may be all you need.
Culled From TheSimpleDollar
