FINANCE YO SELF

Existing Below Your Means

“Live Below Your Means”.

It’s probably the most well-known and obvious piece of personal finance advice.  Spending more than you earn will lead to debt, instability, and your livelihood being dependent on a job.

Then there’s the “personal finance 180” – you slash expenses, downsize your house, get rid of your car and sell a bunch of stuff, leaving you with a lean mean new budget and lifestyle.  I’m not saying there isn’t a lot of waste out there – any long time reader of Mr. Money Mustache can tell you that.  But is it all waste?

Lovers of frugality and minimalism argue that a lifestyle designed around a small selection of thoughtful, well-cared for things (both objects and expenses) is both less expensive and more satisfying than the current standard of parking both cars on the driveway because the garage (and a $150/month storage unit) are full.

On the surface it sounds great, right?  Being happy with what you have, not really needing more, and building a lifestyle that becomes more and more stable and reduces your reliance on a job to survive.

Critics of such lifestyles view all of this is as depravation and sacrifice.  Now, I’ve come to believe that spending 40+ hours a week for nearly the rest of my life to afford things that (mostly) won’t make me happy as a pretty big sacrifice, but that’s getting off track.  Some people like having bigger homes and newer cars and eating out, and if that’s what they deem “living” then good for them.  Some people prefer experiences to things, find their job fulfilling and energizing while others despise their life the second the alarm clock goes off, and feel that real living is being open to whatever knocks on their door while others feel that life is a game that can be optimized and perfected.

Consider this:

“Life should not be a journey to the grave with the intention of arriving safely in a pretty and well preserved body, but rather to skid in broadside in a cloud of smoke, thoroughly used up, totally worn out, and loudly proclaiming “Wow! What a Ride!”

Hunter S. Thompson, The Proud Highway: Saga of a Desperate Southern Gentleman, 1955-1967

At the end of the day, below your means or not, you still have a life to live.  Ideally you’re encouraged to do it in a way that will be sustainable and make you happy.  Saving money is great, and I’m personally energized by the concept of financial independence.  But consider a scenario in which the following two are the same – a well funded stash and a huge house with luxury cars in the driveway.  The scenario – neither one is enough.

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