As a reader of MoneyNing, being frugal – certainly not being wasteful – is probably important to you. But even if we’re trying to be frugal, we all have things we save on and others we splurge on. For many of us, it’s a matter of priorities and what we ultimately deem important.
While our first priorities must be having a well-funded emergency fund, saving for retirement and saving for our children’s college education, assuming we do all these and have some discretionary income left, it’s completely legitimate to spend this money on the things that give us pleasure.
After all, being frugal can’t work long-term unless we find that delicate balance, that personal “happy place” where we manage to save, yet don’t feel deprived. It’s just like going on a diet: if you’re too extreme, if you deprive yourself, you won’t be able to stick with your diet long-term. The only successful diets are those that can be maintained for the long haul, those that allow you the occasional splurge.
Of course, what exactly to splurge on and where to save is a very personal choice. Here are a few of my own choices. I would love to learn about yours.
Food: a definite SPLURGE!
I splurge on food. I try to buy mostly organic, especially meat, dairy and certain produce items. This raises my grocery bill by at least 10%. While we don’t eat out often with the kids, my husband and I do go out frequently, and we almost always choose high-end restaurants. We love gourmet food and we are willing to pay for it.
Cell Phone: SAVE
I’ve had the same cell phone for the past ten years, and my plan is also the most basic, cheapest plan I was able to find. I don’t own a smart phone and don’t plan on owning one in the near future. This is a matter of priorities: I view my cell phone as an emergency-only tool. I hardly ever use it. And I don’t want to have Internet access outside my home – I am way too connected anyway, so time spent outside is a great opportunity to disconnect.
Splurging here is relative. I like designer clothes, but I almost never pay full price for them – I shop at bluefly.com for discounted designer clothes and scour the sales racks at department stores for finds. I still consider this as a “splurge” item, because my annual clothing bill would definitely be much lower if I were not into designer clothes.
My husband and I are very happy with the basic cable plan and don’t feel any need to upgrade.
We still own the same CRT television we bought for $120 ten years ago. We haven’t ruled out upgrading to plasma or LCD at some future point, but frankly, it’s just not a huge priority for us. We don’t watch that much TV anyway.
We love to travel, and are willing to spend a fairly large percentage of our income on travel each year. It’s not just that we love to travel, but we enjoy high-end travel, including nice hotels and good restaurants.
Cosmetics and Skin Care: SAVE
After doing some research, I’ve decided that department store brands are simply too pricey. I now use Paula’s Choice skin care line, which is quite affordable – and effective.
I refuse to pay too much for car and home insurance. A few years ago, after overpaying for several years, I finally did my homework and have ditched my old insurer in favor of a new one. We now have a high-deductible auto policy, are enjoying a good driver discount, and since we buy all our policies from the same insurer (a home and 2 cars), we get a discount for that too. I still comparison shop once a year to make sure staying with our current insurer makes sense.
What about you? What do you save on, and where do you splurge?
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