Living Beneath Your Means
A few years ago, I had a startling realization—
Logan and I were living in a suburb of Dallas on a pretty meager budget. We barely had enough to make it from month-to-month, much less put money into savings or save for things like a car or much-needed home improvements. Money was something we worried and talked about often.
But when I talked to other people, it seemed that they were in a similar boat. They lived month-to-month, hardly ever found ways to save money and felt a great strain when it came to their budget. Here’s the kicker—most people felt this way regardless of how much money they actually made.
So I could be in a group of people and we would all say things like, “I can’t afford to do____” or “Things are really tight this month,” etc. despite the fact that some were living on a budget of $30,000, some $75,000 and some $100,000.
And that’s when I realized that we all felt this way because we were essentially spending as much money as we made. If your salary went up, you bought a nicer house/car/gym membership and then you were living that same kind of hand-to-mouth way all over again. It’s something that we have always done, but I’m wondering if it’s really worth it?
I recently read a blog post by Dana of House Tweaking who talked about her and her husband’s choice to live beneath their means ::
Five years ago, we bought the worst house on the street in a modest but respectable neighborhood. Our plan was to use the equity from the sale of our previous home to fund a gut renovation then plug away at the mortgage. It helped that we purposefully bought below our means. The dilapidated house cost way less than what the bank/realtor/society said we could “afford.” We were able to pay for the renovation in cash, and we’ve been hacking away at the principal ever since. Earlier this month, we made our final payment. The act itself felt both momentous and completely run-of-the-mill, but it’s official…We’re mortgage-free!
Can you imagine being mortgage free by the age of 37? She says they don’t even know what they will do with their extra money, but look forward to “more saving, more donating, more vacationing, more investing, more traveling, more renovating (in a different house), more chilling out, more stuff we’ve never done.”
Logan and I have had conversations in which we’ve discussed this idea of living beneath our means, to purposely spend less than we can afford in order to attain a different kind of lifestyle. Of course, in the end, having extra available cash won’t provide the happiness and security we all hope for (only God can!), but wouldn’t a simpler, voluntarily-humbled lifestyle reinforce our dependence on things other than money?
What do you think? Would you ever purposelessly buy a smaller house than you could afford in order to have more available cash? Would you ever “cap your budget” and make a commitment not to spend more than a certain amount each month, even if your salary increases? What would be the benefits? What would be the disadvantages?
(Painting by Fumi Koike)