I love frugality. Frugality helped me to dig out of debt, begin to build wealth, and find more meaning in the things I already own. But at some point I crossed the line from frugal to cheap. I’ve spent the past few months seeking balance: allowing myself permission to spend on a few indulgences while choosing to cut back in other areas.
There’s new research that indicates this sort of conscious spending really does make us happier. This morning, Jeff V. pointed me to a New York Times article from John Tierney that explores this research. Tierney says that oversaving is a burden for our times.
Unlike some others who have complained about savers recently, Tierney does not argue that we should all rush out to spend in order to support the economy. He merely warns that oversaving does not lead to happiness:
“People feel guilty about hedonism right afterwards, but as time passes the guilt dissipates,” said Dr. Kivetz, a professor of marketing at the Columbia Business School. “At some point there’s a reversal, and what builds up is this wistful feeling of missing out on life’s pleasures.”
During the current recession, hyperopic Ants are presumably having a harder time than ever parting with their own cash, no matter how often President Obama and his economists urge them to do some stimulative shopping. But would these Ants — and the economy — be better off if they relaxed a little? I asked Dr. Kivetz for his advice to shoppers.
“Don’t be too hard on yourself,” he said. “Obviously you need to be responsible and conserve your savings. But it’s been a depressing winter, and there’s nothing wrong with indulging yourself a little. This is a chance to reassess the quality and the balance of your life and to think how you’ll feel in the future. As long as you can afford it, it’s not a bad thing to be enjoying yourself.”
Now obviously nobody is encouraging you to live beyond your means. Frugality is an important part of personal finance, and we all should certainly do what we can to curb costs. Instead, this is a reminder that money is a tool. If you’re meeting your goals for saving, it’s okay to spend some on the things that make you happy.
[The New York Times: Oversaving, a burdern for our times, via Jeff V.]
GRS is committed to helping our readers save and achieve their financial goals. Savings interest rates may be low, but that is all the more reason to shop for the best rate. Find the highest savings interest rates and CD rates from Synchrony Bank, Ally Bank, and more.