Graduated Learning: Life after College

I got my degree, I got a job…now what?

Dealing with Saver’s Fatigue May 31, 2011

Filed under: Personal Finance — Stephanie @ 11:14 pm
Tags: , , ,

Saver’s Fatigue?  Yeah, I made it up.  But basically, I’m getting sick of saving money.

I started automating my savings, transferring money monthly from my checking account to my savings account, back since at least 2007.  Possibly earlier than that.  My bank doesn’t provide my records beyond 2009.  And those were the days when savings accounts were making decent interest.  Do you remember when ING Direct had ridiculously good interest rates?  Man, those were the days.

Now, don’t get me wrong!  I’m really glad I’ve been stashing away money in my savings account these past 4 or 5 years.  I’ve been building up a pretty big emergency fund, and I don’t even miss the money.

Knowing I have money stashed away gives me peace of mind.  And it’s fun logging in and seeing it go up, even if most of the increase in my balance is from my auto-transfers and not from interest earned.

But now what?  I’ve got goals, sure.  But they’re big goals.  Buy a house.  Get married.  Have a few kids.  And I’m going to need money for all of those.  The only time I’ve taken money out of my savings account was when I decided to pay off my car loan 3 years early.  But what am I supposed to do in the meantime?  Just keep up with saving until I eventually have enough for each of these big events?  That’s frustrating and not rewarding at all in the short-term.

I know there are other things I can do with my money.  I could pay off my loans faster.  Maybe that’s a good idea, since I’m paying more in interest than I’m earning in interest.  The mathematical/logical part of me knows I should take a huge chunk of my savings and apply it to my loans.  The emotional part of me just feels safer having more money around, even if it’s costing me something.

I could also put my money into investments with higher returns.  I’m about halfway through “Get A Financial Life” (will have a review on that book soon!), and I now have started considering other ways to earn interest/dividends/etc. on the money I put into savings.  Will have to think on that more.

I have a lot of options for earning more, if I’m willing to take the risk.

But what about spending?

I realized the other day that having savings for non-emergencies is still a valid use of money.  I was getting anxious buying plane tickets and booking hotel rooms for my friends’ weddings.  But then I realized that I’m not going to end up on the streets just for going to their weddings.  My savings provides a cushion for the times when I’m going to spend a little extra.

It’s like AS Green said on her blog post:  “if you are being smart financially (paying off debt, saving for retirement, having an emergency fund) then you should also enjoy your hard earned money.”  She was also referring to Debt Ninja‘s post, where he asserted that “it’s important to enjoy our money”.  I’m not saying you should go buy fancy stuff all the time, or go on 10 vacations a year.  But the whole point of getting on a good financial track was so I wouldn’t have to worry about my future.

So.  I’m going to keep on saving.  I might actually create more “sub accounts” in my ING Direct account so I can assign goals or budgets to different pools of money.  But I’m going to spend a little, too.  I’m going to remind myself that I’m going to have to spend money sometimes.  And I’m going to enjoy that bright blue KitchenAid Stand Mixer I bought for myself when it was on extreme sale 🙂

So, what are you doing with your money?  Do you have specific goals in mind for that money?  And how do you fight off Saver’s Fatigue?

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7 Responses to “Dealing with Saver’s Fatigue”

  1. People often tell me that I can spend money on myself. But I am usually too scared to make big purchases… and sometimes $20 is big to me. It’s so bad that I don’t even have a Canucks jersey! I have more than enough money to pay for things, but i just can’t do it. So like you, I have to learn how to spend money.

    • Stephanie Says:

      Yeah, I tend to be too conservative with my money when it comes to spending money on myself. I’m pretty good at spending on other people. I guess thinking of my recent expenses as money for others makes it better: wedding trips=supporting friends, Stand Mixer=cookies for everyone!

  2. kendallcorner Says:

    Ooh, how do you make “sub accounts”?

  3. Kristin Says:

    I have a bitchin’ hard time spending money on myself on things like electronics, sporting goods, clothing, decorations, and vacations. Part of it is, when am I going to need to move this next (Like thinking about an air conditioner over the weekend)? Is it worth it? Whatever I buy, I have to know it’s the perfect thing, it fits just right, and is exactly what I need. I’ve been wanting a cool DSLR for over 2 years now, but haven’t been able to bring myself to spend that much in one go. Food out with friends is much easier for me to end up splurging on. However, I often go overboard with presents for other people.

    Something that might help is to have some of your money separate from your main savings account/emergency fund/down payment fund as “planned spending”. It’s still something you’re saving for, but it’s much more short term but not long-term enough to be a part of the monthly budget for cash flow. At the beginning of the year, I tried to sketch out how many weddings I’d be going to, what plane tickets I would need where, how much I would need for grad school application expenses, snow tires, ski equipment, yearly fees for AAA or alumni clubs, gifts (that always seem to be so many in December!) and similar stuff.

    It seems like every month, there are a few big-ticket purchases or bills that might throw my monthly budget out of whack if I wasn’t prepared for them – my monthly spending totals in Mint fluctuate all over the place. Or perhaps I need new clothes for when the seasons change, so tend to buy them in a few big trips rather than in neat intervals throughout the year. Your car is pretty new, but mine is 10 years old and I’ve had to do a lot of repairs and equipment replacement in the last year – and something broken is never cheap to get fixed, and it always needs to be done immediately. I can’t budget for, say, “I’m going to spend X on car repairs this month,” because I don’t know when something might break. But I do have a general idea of when equipment will need to be replaced (two sets of tires, two mounting, and many alignments in the last 6 months – ugh!) and can set aside money based on what I’ve spent in the past for when something does break.

    If you have a rough idea of what kind of planned but non-recurring or non-monthly expenses you expect to have and keep that money separate from your other goals, you might feel less stressed out by it. Those $300 plane tickets for a wedding are not busting your monthly budget (wait that’s me!), since it’s not *in* your monthly budget – it gets smoothed out over the year. Your main checking and savings accounts won’t take a major hit when they occur, so you won’t feel like you’re failing on increasing your net worth. Then you can stress out less about smaller day-to-day spending. However, you would need to set aside this money regularly.

    This is the kind of stuff I wish Mint had a better way to deal with. I can’t track how I’m doing on spending for a year with specific targets rather than just a month. (Winter spending on ski tickets and heating oil is way lopsided!) All these little things could be goals, but they’re not overarching goals. And they could be recurring expenses, but they might be so infrequent or fluctuating it doesn’t make sense to enter that way.

    I know DebtNinja has lots of strategies for dealing with the two three-paycheck months that we get each year. Since we have one this month (yay!), I may use that extra amount to set up an ING subaccount for this kind of stuff because my monthly expenses are budgeted around two paychecks. We’ll see.

  4. I fight Saver’s Fatigue by making sure I spend enough money to feel as though I’m not missing out on life … stylish clothes, restaurants, comedy shows (I’m going to one tonight!) all help me feel as though I’m living life, being social, and getting out into the world. And I’m also saving.


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