When Is Being Frugal too Much?

[Johansen8]

If it were me, I'd rather be debt free....then spoil myself so I wouldn't feel guilty about not being responsible enough to take of my bills first....Bills are always an ugly subject but you can be sittin' pretty if they were always taken care of....so what if you don't have the extras yet, you'll be glad to take care of your debts first before spoiling yourself in which should only be a reward after living up to your obligations...

[purplefdu]

I don't see how being frugal won't help you become debt free faster...being frugal normally describes the actions of being monetarily smart and finding ways to save money to be used elsewhere, in this case towards paying off debt.

[InstaMotivation]

I wrote in my blog about the 3 stages to financial freedom.

Stage 1 is when you are in debt, IMO at this time there is almost no limit to being too frugal in order to get out of debt, well besides anything extreme.

After that, to me, it comes down to a simple "is it worth the time?" question. Don't forget to factor in various variables like taxes and what you value your time to be worth.

This will be a future topic in my blog where I'll write about it a little more in depth.

[lsugrad03]

I'm struggling with the same thing...
Here's my issue, and I'd love feedback.

Last November, I moved home to a mid-sized city after 18 months in a large city where I racked up a good chunk of debt. I moved in with a family member about 15 miles from the city center where I work and play. In March, I'll have paid off my debt. My family member is open to me staying longer so that I can save money to buy a house, but my personal life and health have been suffering while there.

It's great to save the money, but because I have an hour and a half commute (round trip) and work a demanding job, I don't have time to eat healthy, exercise, etc. like I would like to. I also find myself giving up social activities because I don't want to drive into town. As a 27-year-old single person, that's hard to give up.

I can afford to live by myself and still save a little, but not as much, toward a house than I could if I stayed with my family member. Living much closer to where I work and play would cut my commute to about 10-15 minutes. That leaves a lot of time to cook and eat right, and get in bike rides and runs. If I rented, I'd probably be able to buy a place in 2-3 years. But if I stayed with my relative, I'd be able to afford a decent down payment in 12-18 months. But sacrificing my health and social life in my 20s just really sucks.

Any advice?

[khorrell]

I would suggest moving out but into the smallest and least expensive safe place that will work for you. Even $100 less rent each month will help you save so much faster. I fell into the "big and beautiful" apartment trap when I was younger and I regret wasting so much rent on space that I didn't use. Or maybe you could share an apartment for even greater savings.

I completely agree that your health and happiness are very important factors to consider and that it is probably worth postponing your dream of buying a house to make sure that you're not crazy by the time it happens.

Good luck to you!

[gt0163c]

Originally Posted by lsugrad03

I can afford to live by myself and still save a little, but not as much, toward a house than I could if I stayed with my family member. Living much closer to where I work and play would cut my commute to about 10-15 minutes. That leaves a lot of time to cook and eat right, and get in bike rides and runs. If I rented, I'd probably be able to buy a place in 2-3 years. But if I stayed with my relative, I'd be able to afford a decent down payment in 12-18 months. But sacrificing my health and social life in my 20s just really sucks.
Any advice?

From what it sounds like, you could save about 1 hour/day in the commute and improve your quality of life including your social life by living in the city. The draw back would be that housing costs would be more.
Have you looked how your other costs would be effected? Transportation would be the big one - don't forget to factor in maintanence costs if you own a vehicle. But, then, also, you would probably be using the vehicle for more trips with your increased social life (unless you live somewhere with great public transportation - you don't say what city you're in).
Would it be possible to rent a tiny place in the city and, therefore, incur less costs for housing? What about getting a roommate? Are there extras you could cut from your budget or find cheaper alternatives? (Magazine subscriptions, take-out coffee, etc.)

The other question is how important is it to you to own a house? I know that for a lot of people that's a big goal. However, is that a specific desire *you* have or just what you think is right for your stage in life? There's no right answer here, it's a personal choice. There's good reasons to buy and good reasons to rent as well.

Another option would be to stay with your family for a bit longer, building up a good emergency fund (if you don't already have one) and beginning to save for the house (if that is your goal) and then move to the city somewhere in the middle of the two timeframes that you stated. It would be a compromise in terms of time, before you buy a house, but would get you the higher quality of life sooner.

If it was me, I think I would choose to move to the city and do what I could to keep my expenses as low as possible, saving for a house that it might take me a little longer to be able to afford. My time and lifestyle tends to be more important to me than money/home ownership. That said, I'm a 33 year old homeowner, no debt, good savings and simple tastes. I don't really sacrifice to live the life I want to live.

[amyschiff]

It sounds like moving to the city and saving could definitely be the way to go, especially when you think about the long-term effects that poor eating/exercising habits can have. If you can get into a healthier routine by renting somewhere, you may save money that otherwise might end up going to doctor's visits etc.

Also, it's not that bad of a time to be a renter really. The market is in shambles so people who do have homes are hurting because the values have gone down so much. It may not be a bad idea to rent for another couple years while the market works itself out.

Like khorrell said, I would try to find the most modest place to rent that makes you still feel comfortable and happy.

[The Zoo]

Bear in mind that by living in the city you'll be exposed to many more opportunities to spend money. Right now you're going from home to work and home again and without a social life you aren't spending much. When you live in the city and have friends, you'll be spending a lot more on food and drinks and activities.

[FitandFrugal]

DH and I are debt free (renting, so if we were to buy a house, back into debt we'd go, but only the house) and we're still frugal. I'm not sure what you mean by spoiling yourself? We go out to eat, but with a monthly budget in mind and once we reach it, no more going out to eat until the following month. We usually buy only what we need but on occasion we will splurge. We do go away twice a year, but we also keep costs within reason for we think it's a waste to go all out on vacation, and we still manage to enjoy ourselves. I also have a yearly budget for my hobby, which is exercise, and once I reach that then no more buying until the following year. So we do manage to buy things we like (hobbies) and do things we like (vacation) but not spend exorbitantly on these things. If that's spoiling myself, then yes, I do, I suppose. If by spoiling you mean buying the latest fashions, electronic gadgets, and the like, then no. I'm not into those things.

[purplefdu]

being about your age I'd say rent the smallest place you can at the best price and get out of the place you're at now. The stress is killer and not going to make it livable. Unless you really know it will only be that year until you can afford a house and want to purchase one. Some small sacrifices are ok but remember that you will also spend more to buy a place more in the city so it may take longer to afford what you want.