Money extremes: From spendthrift to tightwad to somewhere in the middle

Many years ago, when I was paying off a car loan and some credit card debt, I became really frugal. Almost obsessively frugal. I looked for every possible way to save money, and I dreaded ever having to spend money.

Then one morning my husband accidently broke our coffee carafe. I helped him clean up the glass and caught myself feeling anxious about having to buy a new carafe. How much was that gonna cost?

As it turned out, only $12. That's when I knew I had swung too far in the tightwad direction. I'd gone from not really being in control of my money to being a control freak. And it was making me miserable.

From One Money Extreme to the Other

Before I educated myself about personal finance (starting with GRS, actually!), I never tracked how much I was spending. When my credit card bill arrived each month, I had no idea how high or low it was going to be. If it was low, whew! I could relax. If it was high, I'd buckle down for a few months and pay it off. Then I'd continue with my previous spend-now-worry-later habit.

Opening the credit card bill was pretty stressful back then. Here's what I wrote almost five years ago about that period of my life: “My stomach dropped as I looked at the balance, added the expenditures in my head, and realized that yes, it was correct. The bank didn't make a mistake. I bought that stuff.”

Eventually, I started learning about emergency funds and the real cost of paying interest. As I followed J.D.'s story, I slowly started to get my own financial life in order. I saved a small emergency fund first; then I started to tackle my debt.

Being type-A, though, I felt like I had failed in the personal finance area of my life. So I wanted to pay off my debt as soon as humanly possible. I wanted it gone, erased from my credit report and erased from my life. I dreamed of the day when everything would be paid in full.

But somewhere along the way, I started to get anxious about spending money. I worried that I wasn't getting the best deal. I beat myself up because I'm terrible at clipping coupons and remembering to use them. I'd read frugal blogs and kick myself if the writer DIYed something that I just bought. Spending was making me miserable.

Now, there's nothing wrong with being frugal. But replacing a $12 carafe shouldn't ruin your morning, you know? I didn't want to live like that any more than I wanted to dread the credit card bill every month.

I needed to find middle ground.

April in the Middle

I didn't find that balance right away, of course. It took time to (mostly) make my peace with spending and saving. So today I thought I'd share what this more balanced approach looks like for me.

Here are my spending guidelines and how I approach spending these days:

  • I only spend money I have — meaning, no credit card balances … ever. I pay off my rewards card at the end of every month. This action alone alleviates a ton of money-related stress.

  • I spend guiltlessly on things that are important to me. For instance, I greatly value my family's health. So I'm okay with the fact that we pay a lot for grass-fed, organic what-have-you. I'm okay with our gym dues and paying for yoga classes. It feels good to spend money on the things we value.

  • We indulge sometimes. I like the Balanced Money Formula a lot, which leaves room for indulgences like eating out and, in our case, hiring a housekeeper to clean our house twice a month. Uber-frugal me would never, ever, not in a million years, hire a housekeeper. But it is actually more affordable than I thought and, for me, it's been life-changing. Between cleaning sessions, the house requires very little upkeep, and this means we're always ready for company. I enthusiastically pay my housekeeper. She's amazing.

Here are my saving guidelines and my more balanced approach to saving money:

  • We have an emergency fund. Right now, it would get us by for at least a year. That's probably a little too much for an emergency fund; but we sold some land recently, and I still need to figure out what we'll owe in taxes and then set that aside and move the rest of the funds.

  • We contribute to Roth IRAs. Knowing that we're saving for retirement and that we have an emergency cushion helps me feel less guilty about spending money elsewhere. I don't have to worry about what we can spend if we take care of savings first.

  • I comparison-shop for the bigger stuff. If it is an expensive purchase, like the refrigerator we had to buy last year, I spend a fair amount of time sorting through reviews, looking for the best deals, and Googling coupon codes. But researching like that for something like a $12 carafe? I have to let that go. It keeps me more sane.

  • I do a quick gut-check. Before I buy most things, I take a little timeout. Do I really like/need/want this? Do I already have something that works just as well? Could I make it myself? For instance, I recently planned a baby shower for a friend. I saw these neat tissue paper tassels I wanted, but they were $30. Spending $30 for something I wouldn't reuse bothered me. So I Googled “how to make tissue paper tassels,” and I made my own in about 30 minutes with an extra $3 worth of supplies.

  • I lower our bills as much as possible. I love to save money on property taxes, insurance, cell phone plans, and other expenses that I can lower without feeling a pinch. This also can include things like cutting subscriptions and memberships you no longer use and refinancing your mortgage when rates drop.

Of course, this is just what works for me, and one of my favorite GRS tenets is to do what works for you. You might be more frugal than I am; and if you are perfectly happy that way, that's great! I'd probably be envious of how much you save. Or maybe you think protesting your property taxes is a waste of time, and you'd rather focus on increasing your salary. I wouldn't necessarily disagree.

So, readers, let me know in the comments: Have you ever been at a spending or saving extreme? What does balance look like to you?

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Beth
Beth
6 years ago

This post made me smile because I think a lot of us can see ourselves in it 🙂 The biggest challenge for me wasn’t living frugally so I could pay off my student debt, it was learning to find some balance afterwards. I would learn to “lighten up” only to have a tightwad relapse if a job loss threatened or if I felt like I was getting too comfortable (as in, when will the other shoe drop?) For example, my kettle broke and I picked up a new one on sale — I spent the money without thinking twice. Does… Read more »

El Nerdo
El Nerdo
6 years ago
Reply to  Beth

The BMF rules. Percentages, though, I’m learning, also work for businesses!

Seth at Ectopistes
Seth at Ectopistes
6 years ago

I’m glad you’re finding some balance April. After my own struggles with credit repair and getting back to the black I relate with the difficulty of spending in a ‘normal’ fashion- though a new normal. For me the easiest way to feel ok with spending again is to have a proper budget. If my emergency fund is stocked, I’m saving enough for retirement, and my bills are paid then I simply do not worry about how I spend the money I have set aside each month. Spend it on food, clothes, magic beans or booze; it’s ok. I just try… Read more »

Alix
Alix
6 years ago

Frugality isn’t about spending as little as possible; it’s about spending wisely, on the things that matter most to you, while keeping needs and wants in balance. Sounds like you’re there, April!

nicoleandmaggie
nicoleandmaggie
6 years ago

My husband is all or nothing with spending. To fix his spending so that it wasn’t everything and miserable or nothing and miserable we set up an adult allowance for him for frivolous purchases. It has worked really well! (We have a post on it somewhere in our archives, but that paragraph pretty much sums it up.)

I’m much better at buying in moderation, and yes, adjusting to lifestyle inflation or deflation.

lanthiriel
lanthiriel
6 years ago

I did this for my husband too. He has a separate checking account that he uses for whatever he wants. It amounts to about 10% of his paycheck, which is probably less than 3% of our combined take home pay. This system works well for us.

Brian @ Debt Discipline
Brian @ Debt Discipline
6 years ago

Great post April. We have been in debt snowball mode for over 4 years, so we have fell more on the tightwad side, but as we are getting ready to have a budget surplus we have been think of how we will handle. The one thing I keep reminding myself is to still have a plan. Being organized will help us find our balance.

Debi
Debi
6 years ago

Brian, you hit it on the head! Having a plan is key to success in any endeavor, be it career advancement, retirement planning, vacation planning, etc. It doesn’t have to be the perfect plan, just a plan. It can be tweaked anytime you want. It’s YOUR plan.

Dianecy
Dianecy
6 years ago

Your best post ever April, IMHO. While I’ve never been an extreme spender, I have purchased some very expensive things that I later realized I could have spent more wisely on or done without. I have also been generally frugal, with concentrated bursts of extreme frugality. I’ve done a “Spend Nothing” February at least a dozen times. Once I decided to save as hard as I could for an entire year. It was tough, but I chose to do it 2008, as luck would have it. Everything went into investments, and then the market took off. It is the reason… Read more »

Beth
Beth
6 years ago

Thoughtful post. Thank you. Tightwad or frugal…it’s a matter of mindful spending and saving decisions in both cases, but frugality to me comes from a place of control and fearlessness. I realize some friends see me as a tightwad when I opt out of things (e.g., events and purchases) that don’t fit my budget requirements. I’m willing to live with that label in exchange for peace of mind.

Green Girl Success
Green Girl Success
6 years ago

I definitely don’t stress about buying any object that I will use regularly, such as weekly or daily and for many years… i.e. not a fad. I will pay more for a high quality item that will last as long as possible. I feel happier not having a lot of ‘stuff’ around, so I don’t really need to worry about overspending or budgeting. Living simply is the effortless budget for me.

Jess
Jess
6 years ago

Ugh… tightwad me reared her ugly head my senior year of college! I had taken a PF class over the summer and started reading GRS and The Simple Dollar. I changed light bulbs to CFLs (with some help from one roommate), kept un-cranking the heat (until I was told that another roommate had a medical need to keep the heat higher, not that that ever came up when we were discussing how we could all live together), shopped at the “so cheap we don’t provide you plastic bags” grocery store, rarely went out, got hot water at the dining hall… Read more »

Alea
Alea
6 years ago

YES!!! that emotion is real, the guilt, the beating over the head that I am spending money, any money! I never thought I would feel guilty about spending money, but once you are on the treadmill of saving, saving, saving, the guilty feeling was quite the surprise. For me it will be interesting to see if I can break the guilt cycle once I reach all my goals at the end of 2015, or if I find more excuse why I should not spend the money. I have my eye on a pair of diamond earrings from Costco for $1,700… Read more »

Nicole
Nicole
6 years ago

I love this article because I can relate! Sometimes I feel so stressed out and upset if I find a coupon for something I just bought, like that 50 cents is such a big deal. And to be honest, I’m getting burnt out on always trying to find the best deal. It can sometimes get overwhelming. I’d love to hear more about the housekeeper. I’ve never had one clean my house and do it all myself, but I’m getting tired of doing it. I even won a $100 gift certificate to Merry Maids but haven’t used it because the idea… Read more »

Jeff
Jeff
6 years ago

This is why I have a section of my monthly budget, say $100, set aside for discretionary purchases (in Mint I use the “Everything Else” category.) This is for those things I will buy on a whim and I learned early on that if I didn’t account for it ahead of time then I’d blow my budget every month. It also doubles as a small opportunity fund for those times when I come across something on clearance or deep-discount and while I don’t need it now I know that I will need it in the near future and sure as… Read more »

Beatrice
Beatrice
6 years ago

Great article, April! I can definitely relate, esp. the part about feeling the need to research and find the best deal out there before buying an item. That can be a drag so now I limit my research to just the substantial purchases and I’m much happier.

Matt
Matt
6 years ago

Best post on this site in ages! More like this please 🙂

Prudence Debtfree
Prudence Debtfree
6 years ago

We’re on a frugality kick as we pay off our debts. As time goes by though (it’s been just over two years) this frugality is feeling like a new normal. It would be interesting to compare type A frugal-mode with type B frugal-mode. I’m type B, and I’m willing to bet that I’m less tormented than you were when you were hyper-frugal. I don’t beat myself up for not using coupons, and I don’t compare myself to others who are way better at being frugal. I compare myself as I am now to how I was just a couple of… Read more »

Noah
Noah
6 years ago

Loved this post! I definitely agree that sometimes we let money control us. There is definitely a limit to frugal living and worrying in the financial area of our lives. Whenever I need to find a balance between being money savvy and money spender, what I do is that I cut down on my “permitted” budget and review how much I saved by the end of the month. The extra money can either become extra savings (aside from the monthly saving that I already set aside) or small indulgence spending — depending on my mood. We can always cut down… Read more »

Marie
Marie
6 years ago

How does one find a good housekeeper? I feel like they’re a myth. Anyone I’ve spoken to in person has had problems with them breaking things, stealing, or being careless and letting pets escape. It’s only online that I hear about these magical unicorn cleaning people. About comparison shopping: there was a time when I would web-surf tirelessly to cut prices to the bone, but I’ve gotten much more choosy about how I shop due to the hassle of returns. Currently we need new windows, and I’d rather bite the bullet on the price with a local dealer because I… Read more »

Abbey B
Abbey B
6 years ago

While in school I definitely did the tightwad thing, but out of necessity. After getting my first “real job” out of school I suddenly went crazy with spending–at one point I was buying new clothes every week just to avoid doing laundry. I can laugh about it now, but I remember the pain of seeing a zero balance in my bank account just days after I had been paid. The thing I had forgotten was that I enjoyed getting a bargain through savvy shopping–in fact, my roommate and I used to compete to see who could spend the LEAST every… Read more »

terry standring
terry standring
5 years ago

Paying for everything in cash is hard but very rewarding and best way to go, no papertrailes painful but successful. Being indebt will force u to be tight very fast and treat patience. Stick to a budget is the only way out of debt.peace will come

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