When Sarah and I first launched into our financial turnaround, the changes were painful, especially at first. There were a lot of “treats” we dropped out of our life in order to try to achieve some measure of financial success, and I’ll be the first to admit that it wasn’t easy. We went from eating out most nights to trying to figure out how to cook interesting meals for ourselves that weren’t just “open the package, pop in the microwave or oven.” We stopped indulging in endless buying for some of our hobbies – instead of buying books all the time, we became library patrons, for example.
We took on a lot of those kinds of changes at once and it wasn’t easy. In fact, it was probably the “honeymoon” period of being excited about financial progress and change that helped us get through the first stages, and it was a lot of personal 30-day challenges and things like “money free weekends” that helped me keep pushing when the “honeymoon” started to fade.
It was hard. I sometimes “relapsed” into buying treats, caught myself, and found new ways to approach those temptations so that I wouldn’t spend my hard earned money on something forgettable or something not worth the money. I still do, every once in a while.
The thing is, when I look back on those difficulties, the pain that they caused then would only be a tiny fraction of how devastating things would be right now if I hadn’t changed my behavior.
If I had kept spending my money on things that weren’t really important to me back then, I would be facing an incredible mountain of debt right now. While I likely would have my student loans nearly paid off – they were 20-year loans, so they’d be getting close to wrapping up – I would almost assuredly be facing car loans, a mortgage, and credit card debt. I have none of those.
In addition, I likely wouldn’t have any significant money set aside for my children’s educational futures, and I would likely have far less set aside for my own retirement.
You might seem doubtful that all of these changes could be the result of kicking some bad incidental spending habits, but let’s do the math on that.
I dropped my golfing hobby, which was sucking up about $100 a month, and I dropped a couple other hobbies that were sucking up around $150 a month. That’s $250 a month in hobby changes.
Sarah and I stopped eating out about five times a week and moved to eating out about once a week. If you figure each of those changes saved each of us $10 per meal, that’s $80 a week, or about $350 a month.
I broke the routine of stopping for coffee and a bagel before work (saving about $7) each day and stopping for a snack of some kind after work about three days a week, saving about $4 each time. That added up to about $50 a week, or $210 a month.
Let’s not even look at anything else and just focus on those changes. That’s $810 a month. For round numbers, let’s say I did that a decade ago. That adds up to $97,200 in my checking account just due to those three behavioral changes.
$100,000. That’s a lot of money.
Now, how did I use that money? I used it at first to pay down debts fast (alongside cash from selling off stuff). I wiped out our student loans and credit cards and car loans within a couple of years of getting started with this. After that, I was no longer paying interest on those loans – without lifestyle changes, those loans would have kept gobbling money out of my pocket in the form of interest and finance charges. That money that would have gone to interest stayed in our pockets.
After that, we bought a house and paid it off in fairly short order. We didn’t buy a mansion – just a solid smaller family home – so it was much easier to make double and triple and quadruple mortgage payments.
After that, we paid cash for our next vehicle replacement cycle, as we drove our vehicles until they were running into serious problems.
We also started saving hard for future goals. We started throwing money into college savings plans and into retirement savings. That money started earning investment returns, and the returns were reinvested and that money started earning returns, too.
Now, that $100,000 didn’t do all of that, but it did a healthy portion of it (the time span was also a little longer than a decade, to boot) and the cuts in interest and addition of returns on our investments provided a lot more. It was also helped by other frugal choices, big and small, but it all started with a challenging commitment to start turning things around followed by a lot of experiments and efforts to cut out the unimportant spending in our life as well as efforts to start side gigs to improve our income (most of which failed, but a few of which did well).
That’s the difference between our life as it is today and what it could have been like. I made a painful decision to stop spending money on “treats” that did nothing for me in the long run and instead use that money to build a financial foundation that would make the rest of my life much easier.
Here’s the thing: no major life changes are ever going to be easy. You likely have a life routine that you stumbled into over time because it was convenient and pleasurable and changing it sounds inconvenient and not pleasurable. In many ways, your life follows the path of least resistance, and this is all about rejecting that path of least resistance, at least in the short term, to find a better way of doing things. That’s hard. That’s always going to be hard.
I like to think of my life as it was a little over a decade ago as me standing on top of a foothill near the base of a mountain. As I looked around me, it was downward in every direction – I really was living what felt like the best life for me in the short term.
However, I wasn’t that far away from much bigger hills and mountains. Sure, if I was only willing to look a thousand feet away from where I was, everything was downhill. I’d have to walk down from this little hill I was standing on, making my life a little worse in the short term.
Before long, though, my path would lead me up a much bigger hill, or perhaps even up the mountain. After a while, I would be higher than I ever would have been staying on that foothill. Sure, the journey to get there took me on an uncomfortable path through some lowlands, but without taking that journey, I would never have been able to reach anything higher than that foothill, and what would I have done when the floods came?
Change is always painful, especially when you’re happy with some aspects of your life. It hurts to uproot things that seem good in a desire to chase something better in the long term.
The trick is to recognize that things in your life that bring you only fleeting joy or comfort should not be things that you should dump your life’s energy and effort and money into. When you let your finances fall apart so that you can have a treat, you’re taking a little burst of pleasure now in exchange for real difficulty later on. That pleasure quickly vanishes, but the pain is real and it remains.
It’s also vital to recognize that there are a lot of sources of joy and pleasure in life, and that you’re going to inherently focus on the handful of things that you’re losing because of these changes. Rather than dwelling on the handful of things you’re losing, focus instead on the many, many things you still have. My financial changes didn’t do anything to my closest friendships or family relationships. My financial changes didn’t do anything to keep me from enjoying hikes or enjoying reading a book or enjoying playing a game. My financial changes didn’t prevent me from enjoying a good meal. The changes didn’t do anything to prevent me from enjoying a long walk on a beautiful day or any of the many other things I enjoy all the time. The changes didn’t do anything to hurt my relationship with my kids or my ability to have a parental bond with them. It didn’t do anything to hurt my marriage or my closeness with my wife. It just took away a few trivial things, but it brought me so much more.
The pain of changing now is almost always far less than the pain you’ll soon feel from not changing. That’s true for almost any worthwhile change in your life.