No Point Making Money If You Don’t Spend Your Money

Vacation Property

Imagine you’re a financially successful 35 year old professional making $250,000 a year.  You’re still $130,000 short from being in the top 1%, but by any other metric, you’re doing just dandy.  Yet, instead of living a comfortable life, you live like a pauper, renting the same dumpy one bedroom since you were 25.  For wheels, you drive a 2002 Toyota Corolla and for vacation, you always stay domestic, never wanting to see the world.  Everything you do, or don’t do rather, is because you want to save money.

Some of you may think this is a great way to live, as certainly you’ll be saving a boat load of cash for retirement.  I say there’s absolutely no point making that kind of money if you are going to live so frugally. Six figure jobs are a dime a dozen, but generally come with higher stress.  As such, you might as well just make a fraction and lead a carefree life if you never plan to spend your earnings.

Watching the zeros grow in your bank account is a very empty feeling after a certain point. It might boost your self-esteem to tell your friends how much you have, but that’s just shallow. Cash is only a medium of exchange, and a means to provide a better life. If you aren’t utilizing your cash, then you are wasting your time.


There’s a fine line between being smart with your finances and being overly frugal. Let’s say you’ve always wanted to buy that second-hand $30,000 Porsche in your 30s and your gross income is 10X that amount.  Instead of buying what you want, you get a $8,000 Toyota Corolla to save money in your 30s.  Well after 10 years, guess what?  You’re in your 40s and the novelty has worn off.  You’re just another 40-something year old knuckle-head going through a midlife crisis.

Comfortable shelter is the same thing.  The rental stock is generally inferior to the ownership stock.  Due to rent control, many landlords haven’t updated their apartments in years.  Sure, you may be saving money renting your same 1 bedroom in your 30s as in your 20s, but you’re also crimping your lifestyle if you can afford to buy or rent a two bedroom or three bedroom apartment or home.  You’re going to be middle aged and feel proud of yourself for saving X amount of dollars.  Meanwhile, someone who spent what they could afford has been living a much better lifestyle for the same time period.

Great vacations are priceless because of the everlasting memories they provide.  Instead of flying off to Greece, you decide to experience your 3rd staycation in a row to save money.  Meanwhile, you’re getting older and you’re no longer as nimble as you once were to hike those great mountains.  It’s harder for you to sit comfortably on an airplane for longer than 3 hours because of deep vein thrombosis and numbness in your legs.  Now, what’s better?  Living a better lifestyle that you can fully afford, or saving an extra buck or two?

Related: Practice Taking Profits To Pay For A Better Life


Most of us who are educated and who work hard are going to die with TOO MUCH money in our bank accounts.  I know retirees who have great pensions with no mortgage and very little expenses still try and save as much money as they can.  Well guess what?  That’s kind of counterproductive, because saving money while you are retired is like saving money to spend in death.

I’m likely saving too much money by putting away 70% of my after tax income.  It’s been instilled in me ever since I got my first crappy job at McDonald’s to save the majority of money and not spend.  It’s very hard for me to spend more, largely because I feel I have everything I need.  It would be nice to have an ocean view vacation home in the South of France, but that seems like just too much hassle.  The only thing I’m thinking of purchasing is a 2nd hand car to replace 12 year old Moose in 2012.  I need to live it up more.

After maxing out your 401K and IRA and then saving 20% of your disposable income after retirement contribution, I say we should spend guilt-free the remainder on whatever we darn please.  If we try our best and fail at spending all our disposable income on living life, then saving the rest isn’t so bad.

Related: Retire By A Certain Age, Not By A Certain Financial Figure


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Planning for retirement when paying for private grade school

Are you on the right retirement path?

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Updated for 2021 and beyond.

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