Is There A Natural Spending / Savings Balance?

Balanced Spending by Andrew MacGill Flickr Creative commons

For the past several months, I’ve been spending tens of thousands of dollars remodeling my new old house. I’m only its second owner in the house’s 68 year old history and it needs a lot of work as a result.

For example, I just spent $9,000 painting the exterior, the fence, the windows, and all the metal fixtures. The painter estimated the house hadn’t been painted in 25 years! He mentioned that his crew normally uses two gallons of spackle to fix stucco cracks on a house my size, but they used eight gallons to smooth everything out.

Even though I budgeted extra money to bring the house up to date, I still feel dirty spending so much money. It makes me wonder whether we all have some type of self-correcting overspending limit, just like we all have this self-correcting over-eating limit. If we didn’t, we’d all be obese and broke. Nobody I know wants to work forever and feel the constant stress of having no money.

If the average desire to spend is a 5 out of a 1-10 point scale, I’m about a 3. But for the past several months, I’ve been spending at an uncomfortable 9. I’m curious to know where would you rank yourself on the spending scale?

Some of us might have to hit rock bottom before we find our happy spending / saving balance, but at least that makes future spending and savings habits that much stronger.


There are only two things I have left to remodel: 1) Build a relatively large ~170 square foot master bathroom with jacuzzi tub, walk-in closet and separate shower, and 2) Build two decks out back facing the ocean to create an ideal indoor/outdoor living space.

I’ve always imagined sipping a glass of wine on a balcony while reading a book before the sunset. Perhaps I can do a lot of inspired writing on the balcony during warm days as well. Let me check with my accountant whether a balcony that helps produce better writing can be a business expense.

As for the master bathroom, I’ve got a large garage that cannot fit two cars tandem. Therefore, I might as well take as much wasted space in the garage as possible to make a large bathroom. The incremental cost of building a larger bathroom is pretty small. Every additional square foot of living space built increases the value of the house. If you can build at $300/square feet when property is selling for twice that amount or more per square foot, you should build all day long. This arbitrage is one of the biggest reasons to purchase properties in expensive locations with expansion potential. The fixtures and building costs aren’t that much more in SF vs. Houston, for example.

Although having an amazing spa-like bathroom where I can write from a deep soaking jacuzzi tub for hours in the morning would be great (72″ X 42″ was the biggest they’d go), I no longer feel the rush to remodel my home because I no longer want to spend any more money for several months. Instead, I want to replenish my coffers and prepare for upcoming property and income taxes.


Existing Tiny Bathroom


Proposed Master Bathroom Floor Plan (15′ X 12’10”)

When the contractor asked me to do the $2,200 (!!!) drawing specifications ASAP because it will take two months for him to get approval from the SF planning department, I told him, “No rush! Let’s really think about all the details before we start.

What I’m really trying to do is buy time to replenish my piggy bank.


Given I’ve been a lifelong saver, spending more than I make for three consecutive months feels wrong. In fact, spending more than 70% of my monthly net income during any month starts making me feel very uncomfortable since I’ve been spending 50% or less since 2000. I’m an absolute stickler for buying things only through disposable income. Withdrawing from my bank account to pay for things feels dishonest.

It’s holiday spending season again and perhaps many of you are taking advantage of all the deals. I’m thinking about buying a nice 60″ LED HD SmartTV for my bedroom, but just can’t right now. I abhor physically shopping during this time due to all the crowds, bating and switching of advertised products that are no longer available once you get to the store, and the time it takes to find a parking spot and pay for everything. As a result, I do 100% of my shopping online.

My challenge to you is to try and hustle to make extra money before the end of the year to cover all your extra spending. Those nasty credit card bills you’ll receive in the New Year are no fun.


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