2759: Saving Is Hard - But That Doesn’t Mean You Shouldn’t Do It by Chelsea Brennan of Smart Money Mamas

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[00:01:30] And I'm your host and personal finance enthusiast, Diana Merriam. Now let's jump right into our next post as we optimize your life. Saving is hard, but that doesn't mean you shouldn't do it by Chelsea Brennan of smartmoneymamas.com. Does anyone have the best conversations with their mom?

[00:01:54] Recently, we went to visit my mom in Connecticut. We had to see the owner of the house we'll be renting, and I obviously had to get in some mom time. There are so many reasons that I love seeing

[00:02:04] my mom. She gives the best hugs. She's a super amazing rock star who takes the night shift with baby Minnow so Jeremiah and I can get some sleep. Seriously, saint status here. And we always, always end up having a thought-provoking conversation. This time it was about money.

[00:02:23] Happiness today or happiness tomorrow? During our visit, my mom was telling me a story about how she and her boyfriend almost made an impulse purchase of a used convertible the weekend before. She's always loved convertibles. This one was a great price, drove beautifully, and they really

[00:02:41] wanted it. As she's talking through the negotiation, she saw my ever frugal, oh, what did you do face? Stopping, she asked me this question. How do you balance spending for happiness today with saving

[00:02:56] for the future? And I'm going to be honest, it stopped me in my tracks a bit. And even after going home and spending a few days, it kept nagging at me. Not because I didn't have an

[00:03:07] answer to the question logically and intellectually, but because I was stuck once again by just how hard this question is for someone who's new to it. When you first start budgeting and prioritizing saving

[00:03:20] or a shock to your finances brings you back to it. It feels like there is absolutely nowhere to cut. You spend hours asking, how do people that make less than me do it? Everything feels like a need

[00:03:33] because all the wants have become paramount to your happiness, even if they aren't. And the truth is for the vast majority of us, me, my mom, and probably you, even if we did appreciate and derive

[00:03:46] great joy from all the things we want to spend money on, we just can't afford it. We could spend every cent we had and still want more, more things, more experiences. So tightening the belt

[00:03:59] beyond the already snug limits of our income to protect ourselves in the future is hard. So what do you do? Where do you draw the line? Spender or saver? We all have things that matter

[00:04:13] to us. My mom and I have very different desires. And in our discussion, she called me out for that. It's easier for me to save, she claimed, because my hobbies aren't high cost, because I like eating at home more than dinners out and Harry Potter board games,

[00:04:29] because my dream car was a Subaru Outback. I conceded. But I'll tell you a secret. I'm not sure she's right. Sure, I don't want the little things. I would rather keep the cash safely

[00:04:42] in the bank. However, my personality makes it so home is the most important thing to me. I want a big, nice kitchen, a homestead where we can grow our own food and a wood shop for Jeremiah.

[00:04:55] Oh, and a Ford F-150 so that I can get my dream car back. Hubby's currently the main driver of our Outback. I spend hours making notes about properties on Zillow. And all of these things

[00:05:08] cost way more than the $4,700 used convertible my mom was pining over. So why aren't we buying them? We have the money for all of them right now. In fact, with the exception of the homestead,

[00:05:22] we could probably pay cash for it. Why not dive in? It would maximize near term happiness, right? Tomorrow comes whether we plan for it or not. We're waiting because doing it now would blow

[00:05:35] up our bigger goals. Sure, we would be over the moon excited about crafting our perfect home for a while. But when the day came when I was 45 or 50 or 60 and couldn't retire because I threw

[00:05:48] caution to the wind when that Zillow house has just the perfect kitchen layout, I'd be pissed and sad and scared. Every single one of us has things we want in life. A new convertible,

[00:06:01] the perfect house, a workshop full of power tools. But if we don't prepare for the future first, then learn to live happily within what's left over. We're not only setting ourselves up for

[00:06:13] failure, but for unhappiness. So before you fall prey to the excuses, the there's nowhere to cut and the what if you don't even make it until retirement? Let me offer you this. The average Social Security check last year was $1,360 a month. Take a moment and imagine yourself

[00:06:34] at 65 or 70 trying to live off of $1,360 a month. Could you afford to go out to dinner? Travel to see your grandkids hockey tournament? Buy groceries? To this, my mom said, but tomorrow's never guaranteed. You could pass long before you even retire. Yep, 100% true. But probable?

[00:06:57] Something we can lean on as an excuse not to save? No. Too often when we think about life expectancies, we focus on how we might be disappointed by delaying happiness if we pass away before that time. What we forget is that life expectancy is just an average,

[00:07:15] which means over 50% of people will live beyond that point. With more years to cover in retirement, we chose not to plan for. And that I think is core to my answer. How do you balance spending

[00:07:29] for happiness today with saving for the future? You remember what life could look like if you ignore the future for too long. You protect that future version of yourself first within reason,

[00:07:41] and then you take advantage of our endless ability to adapt as humans by living happily on what's left. To me, within reason means spending at a level where I will be able to maintain a consistent

[00:07:53] quality of life. I'll be able to cover my living and health costs in addition to the luxuries I choose to prioritize in retirement the same way I do today. Achieving this balance might mean

[00:08:05] only buying used cars, skipping a vacation, or picking up a side hustle. It also certainly means giving up at least a little near-term consumption. But the 50 versions of me expected to live beyond

[00:08:18] 93 years old? Those old broads are probably pretty pumped I'm not at the store picking out a Viking stove. You just listened to the post titled, Saving is Hard, But That Doesn't Mean You Shouldn't Do It by Chelsea Brennan of smartmoneymamas.com. Looking to part ways with complicated, expensive,

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[00:09:01] and keep it all reliable with on-time ground shipments. It's time to turn shipping to your advantage. Learn how at USPS.com slash advantage. USPS Ground Advantage. Simple, affordable, reliable. For a lot of people, it can be stressful and confusing to manage their finances.

[00:09:22] Even I used to feel this way when using different finance apps. But then I tried Monarch Money, and everything got so much easier. Maybe you're saving for a down payment, a wedding, a dream

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[00:09:50] It gives you a comprehensive view of all of your accounts, investments, transactions, and more. Create custom budgets, set goals, and collaborate with your partner. And now get an extended 30-day free trial when you go to monarchmoney.com slash OFD. After trying out Monarch for myself,

[00:10:09] I understand why it's the top rated personal finance app. And right now, get an extended 30-day free trial when you go to monarchmoney.com slash OFD. That's M-O-N-A-R-C-H M-O-N-E-Y.com slash OFD for your extended 30-day free trial. I think it is absolutely possible to save for

[00:10:32] the future without sacrificing too much of your happiness today. But it requires a bit of a mindset shift. There's an inherent assumption when this kind of question around spending comes up. We assume that spending money will lead to happiness. So we're trying to decide if we'll

[00:10:49] allow ourselves that happiness now or later. But I think that assumption is flawed. If spending more money always led to happiness, why are so many rich people still miserable? If we can operate from the understanding that the best things in life are free and learn to enjoy simplicity,

[00:11:06] it solves a lot of this debate. Close relationships, community, purpose, your health, the way you use your time, these are the things that really matter. And money is just a tool to help you prioritize these things. When we're distracted by considering which material

[00:11:23] possessions we want to buy, we could be overlooking the things that will actually lead to happiness. And that's a wrap for another Thursday show. Have a great rest of your day, and I'll be back tomorrow as usual, where your optimal life awaits.