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Frugality Fatigue: Saving too Much Can Be Counterproductive

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The following guest post is by Paula at  Thanks Paula!

I’m tired of saving money. I’ve saved ever since the Tooth Fairy was my sole source of income.

As a child, I stashed my allowance in a drawer. As a 15-year-old working at a McDonalds drive-thru, I stashed my paycheck in a savings account. When I was 17, I asked for a parent signature so I could open a brokerage account as a minor.

Well, guess what. Now I’m a grown-up. Now is when I start dealing with larger sums of money. Now is the time savings start to matter.

And I’m sick of it.

I recently was digging through some childhood items and I came across an old purse with $11 inside. I must have saved that, quarter by painstaking quarter, when I was a little kid.

All the grown-ups around me praised saving, so I saved. I never saved for a goal. I saved for the sake of saving. I thought it was the “right” thing to do.

I saved for the sake of saving. I imagined it would somehow – in some intangible way – benefit me as an adult. I imagined myself in 20 years, tall and well-groomed, proud of my young self for having the foresight to save her allowance.

Instead, my modern-day adult self thinks: “$11 is nothing. I’ve paid more than that for one day’s worth of event parking. Why didn’t my younger self just loosen up?”


Years ago I read an article – I think in Money Magazine? – about saving for retirement.

It was probably the 2,499,249,398th retirement article I’ve read, but it said something that I’ve never read anywhere else, which I’ll paraphrase:

Make sure you save enough for retirement, but also make sure you don’t save too much, or you will have spent your life living more frugally than you needed to.

That’s when it hit me: That’s exactly what I’ve been doing!

I had been saving not for a goal, because saving is my default method for handling money.

Savings help me feel secure, and that feeling of security is worth more than the “high” of a purchase.

But I might have been missing out on some crucial, enjoyable moments in life – some of which include things I can’t do when I’m older. I might be living too frugally, missing life.

Worse yet, I was at risk of snapping. I was at risk of knee-jerk splurging to overcompensate.


The trick, I realized, is to save with intention. Saving for saving’s sake is hoarding.

I still save for long-term goals: retirement, creating passive income streams.

But I balance that by saving for short-term experiences, like flying to Europe or renovating my kitchen and boudoir with luxury bedroom furniture.

And I further balance it with spending on quality items: I work out at the best gym, not the cheapest one. I buy clothes because they’re well-tailored, not because they’re on the clearance rack.

No matter how your natural inclination leans – towards saving or spending – you’re best off doing a balance of both. We all know that spending indiscriminately is dangerous. Saving indiscriminately can be just as bad.

Crystal’s Comments:  I am a big fan of savings goals.  I am so glad Paula is allowing herself a little leeway now!  Have you ever had to remind yourself to take a step back to see a big picture?

FYI:  I worked at a dead end cubicle job from 2005-2011 for about $30,000 per year.  I went self-employed in July 2011 and make between $70,000-$90,000 through blogging, professional pet sitting, hubby's reffing, and our rental home.  If you’d like to start your own site (link to my free step-by-step guide), I highly suggest checking out Bluehost (my referral link with a nice discount for you, PLUS a free custom header banner from me!).  Please contact me any time at budgetingfunstuff*at*gmail*dot*com with questions or just to brainstorm! I’d love to help!
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24 thoughts on “Frugality Fatigue: Saving too Much Can Be Counterproductive

  1. I hear this advice a lot, but I don’t agree with it. Sure, you should loosen up your lifestyle a bit until it’s comfortable, but there’s no reason to look for places to spend your money. Eventually a reason to spend it will come to you on its own unbidden. Having a lot of money saved up can provide freedom.

    Our first two years with real jobs (but used to living on a tiny fraction of the salary in an expensive city), DH and I had this discussion– what should we do with the extra money? Save or find some way to spend it? Two years later a very good, very expensive, reason found us and we were very glad to have that extra money saved. We were able to do something wonderful we would have been unable to do otherwise.

    Now, that isn’t to say you should keep washing out baggies etc. if you’re putting away 100K/year, unless you *want* to was out baggies. Just that finding spending goals isn’t necessarily the way to go. Find a standard of living you’re happy with and don’t look for things to purchase. Save what’s leftover.

  2. To me it’s like a steam valve. You need to release some pressure from time to time to keep the system working properly. Spending a little bit of that saved money here and there gives tangible proof that the saving is paying off, as being able to buy something here and there with saved money will reward for the saving and demonstrate also that there are better things to come down the line. If you save and save and save but only have something to show for it after thirty years, it can quit being rewarding.

  3. I also save as a reflex, but I’m now channeling that into working towards financial independence. It’s more motivating and will give me a time to taper my savings based on my goal.

  4. I think having goals keeps you from thinking one day “well I have all this money saved, and no specific purpose for it, let me buy this one big thing.” Instead of making a large impulse purchase just because you have the money saved, having a goal for what to spend on can actually help you keep saving.

  5. Good point Paula! Saving without a goal can be disastrous. You won’t know when to stop and you won’t know what to use the money for. Obviously I would rather error on the side of saving too much than too little, but it is important not to allow saving money ruin your life.

  6. Great post, Paula!

    This is something I’ve been struggling with the past year or two, since I finished university. When I was younger, anything I was saving for was right in front of me. Want a new CD player? OK, save your allowance for a few months, top it up with your birthday money. Bam. Need money for school? Save like a mofo! But now I’m in the position where I’m making money, have no debt, but all of my savings goals (retirement, owning a home) seem so far away. I try really hard to balance frugality with actually living my life, but sometimes I really question what is the point of it all, if I have to scrimp and save and *maybe* be able to afford a house by the time I’m 35. Sigh!

  7. I could have very easily of written this article. Actually I have in slightly different words on my blog in the past, same meaning different words of course.

    When I commented on my intentions to spend more, I got some of the most unusual responses.

    With you and I Paula, we are so frugal that it’s hard to spend money without a bit of guilt because we know that it’s “Good” to save and “Bad” to spend.

    It tooks me a long time to develop a more balanced lifestyle… Congratulations to you for recognizing that you don’t want to be a miser in life (me neither now)!

    Great article, and I know exactly where you are coming from 🙂

  8. I like this article. When you save for no purpose, you start to wonder what you are working for. I think saving for goals that are decades away are the hardest to do.

    I think the ideal lifestyle is to have “enough” so that the savings just comes naturally. If you can be happy with the simple pleasures in life, you don’t need to buy as much and you can achieve your goals faster.

  9. Paula,

    Your article was a great read. I think it’s definitely important to save for a goal, or else you end up working hard your life for nothing. Hard work = reward.

    Goal setting is definitely important. Once you set a goal and aim for it, you’ll likely continue to set up goals for yourself in the future.

  10. @Nicole – I think we’re both saying the same thing. As I mentioned, spending indiscriminately is dangerous … you should never search for something to spend your money on. But if there’s something you want (like a membership to a great gym with tons of amenities), you should give yourself the freedom to spend money on it, as long as you’re also saving for the future.

    @MoneyBeagle — ooh, I like the valve analogy! My boyfriend is Mr. Fix It, and he loves explaining how stuff works … he would LOVE that analogy!

    @Erin – Thanks! Goals are awesome!

    @NoDebtMBA — Is it weird to also be someone who saves reflexively? So much of the personal finance info out there is for people who spend reflexively … when I started reading PF I always wondered, “am I the only one who has the opposite problem?”

    @Hunter – Thanks!

    @Kellen – You’re right; once you have a bunch of money saved, you’re more apt to blow it on something you don’t care about, rather than gradually spending it (tricking it) on many smaller things that you DO care about.

    @Kevin — That’s an awesome reason! Kick The Hoff’s butt!

    @Matt – “dont let saving money ruin your life” — well said! I like that phrasing … there’s no reason to save and save, with no goal, just to wonder how life passed you by in the meantime!

    @Melissa – I understand! Try balancing saving for stuff that seems far away (retirement, a house) with stuff that’ll happen in the next year or two (a trip to Hawaii, a designer handbag, having the funds to get a dog and pay all its veterinary bills, etc.)

    @Money Reasons – Hooray for both of us!! I think we’ve learned an important lesson … and I’m glad we both learned it before it was too late!

    @First Gen American – You’re right, once you have “enough,” if you’re satisfied and you can avoid “lifestyle creep,” savings will come naturally. My parents always spent the same amount of money regardless of how my dad’s income would fluctuate, so in the years that he earned a lot, they’d save more than 50% of their income.

    @Jenna – Agreed! Enjoy life!

    @Kevin Yu — Thank you! You’re right, once we experience the thrill of achieving a goal, we’ll continue to set more goals and higher goals. If we never experience the joy of achieving a goal, we’re not likely to push ourselves.

  11. For us .. saving too much is not counter productive, in fact, it’s kind of fun to see it grow. But it might depend on (as said) what one’s goals are, and how much one makes. Anyone who is saving too much (is there such a thing?) is probably instead not paying the bills (dragging them out longer than needed?), or maybe not budgeting in some fun stuff. ;^) Now that would be counter-productive. Thankfully, we make more than what we need. With time, everyone should get to that point in their life.

    Nice post. One should have some fun every now and then, without guilt or repercussions from those penny savers. HA!

  12. With you on this! Sometimes saving and being super frugal feels like your punishing yourself- like a horribly restrictive diet, for example. We’re only human- we need the occasional release and treat every now and again. Keeping both spending and saving in moderation is key.

  13. One of my goals is to give away a fair bit of money to others, so I indeed plan to over-save to a considerable degree.

    But a strategy is all about balance, and it should indeed be tailored to individual goals and preferences. One of my reasons for acquiring wealth is so that money is not something I need to care about, even during the process. So, although I keep my expenses fairly low each month, I don’t mind spending on something that provides a lot of value in my view.

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