When Frugality Affects Quality of Life
What happens if you follow all the smart money rules to get ahead, but find you're not getting anywhere at all?You pay off credit cards every month, pay extra toward your mortgage and fund two retirement accounts, plus a 529 and an emergency fund. You rarely spend on new clothes; you always pack your lunch and work extra hours every week to fund your savings goals. This is the situation one frustrated reader over at Get Rich Slowly describes.
What happens if you follow all the smart money rules to get ahead, but find you're not getting anywhere at all?
You pay off credit cards every month, pay extra toward your mortgage and fund two retirement accounts, plus a 529 and an emergency fund.
You rarely spend on new clothes; you always pack your lunch and work extra hours every week to fund your savings goals.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
This is the situation one frustrated reader over at Get Rich Slowly describes. Even in good times, when you can watch savings compound and debt dwindle away, this nose-to-the-grind lifestyle is challenging to sustain and best linked to an end goal. In a bad market (as we've had), it can be crushing to watch everything you save disappear. Those market conditions do not make an extreme, savings investment plan worthwhile.
So what to do instead? JD at Get Rich Slowly recommends a balanced spending formula from All Your Worth. It suggests that 50% of income should be spent on needs, 20% on savings, leaving 30% for wants. Try our online budget worksheet to see if your expenditures can fit this formula.
Also, our savings calculator estimates how long it will take save a million. You can see for yourself: It's not going to happen overnight ... So how about budgeting for a little breathing room?
How do you keep financial burn-out at bay?
To continue reading this article
please register for free
This is different from signing in to your print subscription
Why am I seeing this? Find out more here
-
How To Use Beta in Investing
Beta is one way to measure a stock's historical volatility. Here's how it works.
By Coryanne Hicks Published
-
Key Tax Provisions That Are Expiring After 2025
The Tax Letter Unless Congress decides to act, lots of tax changes will take effect in 2026, including higher tax rates and lower standard deductions.
By Joy Taylor Published
-
5 Ways to Save Money on Vacation Rental Properties
Travel Use these strategies to pay less for an apartment, condo or house when you travel.
By Cameron Huddleston Last updated
-
10 Annoying Hotel Fees and How to Avoid Them
Travel Here's how to avoid extra charges and make sure you don't get stuck paying for amenities that you don't use.
By Cameron Huddleston Last updated
-
How to Appeal an Unexpected Medical Bill
health insurance You may receive a bill because your insurance company denied a claim—but that doesn’t mean you have to pay it.
By Rivan V. Stinson Published
-
Amazon Prime Fees Are Rising. Here’s How to Cancel Your Amazon Prime Membership
Amazon Prime Amazon Prime will soon cost $139 a year, $180 for those who pay monthly. If you’re a subscriber, maybe it’s time to rethink your relationship. Here’s a step-by-step guide to canceling Prime.
By Bob Niedt Published
-
How to Haggle for Almost Anything
Smart Buying Learning how to haggle is an invaluable skill. These strategies will help you negotiate a better price for just about any product or service.
By Katherine Reynolds Lewis Last updated
-
Disability Insurance Can Provide COVID Coverage
Coronavirus and Your Money If you are concerned about long-term complications from COVID-19, consider disability insurance coverage.
By Rivan V. Stinson Published
-
21 Things You Can't Return to Amazon
Before tossing these items into your virtual shopping cart, be sure to read Amazon's return policy first.
By Bob Niedt Last updated
-
How to Avoid a Charity Scam
personal finance Scammers never quit, even when you're trying to be altruistic. But you can avoid getting duped if you do your homework.
By Rivan V. Stinson Published