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Today’s post comes courtesy of Scott Henderson, MS, AFC®. Check out his tips for balancing today’s happy spending and future savings.
Caught In Between YOLO & Saving Money
You’re young, and you want to live life to the fullest, and you may have a dilemma going on inside between living now vs. saving for the future.
The problem with the YOLO mentality is your future self will suffer. But if you only save money your present self will also suffer.
So how do you find a balance between the “you only live once” mentality and saving money toward your future?
You Only Live Once
The truth is you only get one life. No one knows what’s going to happen tomorrow. The only thing we know for sure is humans have a 100% mortality rate, which makes time our most valuable asset.
You should be living life to the fullest, living in the moment, and doing the things you love the most. Because we never know when our time to go will come, living in the moment brings more joy into your life.
Because you decide to embrace the YOLO mentality doesn’t mean you have to blow all your money. My friend Jason Vitug wrote a book in 2016 called You Only Live Once.
The book sets to redefine the YOLO mantra that has been used to define Generation Y or Millennials, to set a mindset shift to cultivate a healthy and wealthy lifestyle for a lifetime.
Money can enable you to do things that bring joy. Because you work much of your life away, the hardest thing is deciding how much of it to use today vs. saving it.
Saving Money
Saving money is important—we get it. But what about when your desire to save money inhibits your ability to enjoy life in the moment?
It may depend on your money personality, but certain people are more likely to save for their future than others. Those who save for their future and reach an old age usually never regret it. But those who didn’t save tend to regret it big time.
As I mentioned, we never know when it’s our time to go. But the reality is most of us will live to see old age. We’ll grow up, buy a house, have a family, and one day retire. It may seem like forever away, but you’ll get there and then wonder how time flew by so fast.
Finding Balance
I’m in my late 20s, and I’ve struggled with this question for over ten years. I’ve felt continuously stuck in between living now and saving money.
When I see friends going out and buying fancy cars and going on lavish trips, it’s easy to feel envious. But it doesn’t mean I can’t still enjoy things today.
What I’ve tried to do is find a balance. I’ve done it in two ways:
- Having a play account
- Working toward a bigger goal
Play Account
Here’s what I mean with the play account. I intentionally set aside 10% of my income for things I enjoy. My wife and I call it our play account. It’s a separate bank account that once I get paid, I transfer money into it.
This allows us to have non-guilty spending money for present things we enjoy. Because we’re both naturally savers, this forces us to do things we love to do.
Working Toward A Bigger Goal
At the same time, we’re working toward a more significant goal. For example, our goal isn’t to save money, or buy a house, or become debt-free; we’re working toward a goal no one around us working toward.
Financial independence; the day work becomes optional.
We’re most likely going to get to the age where we would like to not have to work. This motivates us to save our money.
Every month we put at least 10% toward our financial independence account that we dollar cost average into a Vanguard index fund.
Conclusion
Having a play account and saving toward a bigger goal like financial independence helps us maintain a balance between living now and saving money.
You can choose to only live in the moment, and our future self will suffer, or you can choose only to save money, and your current self will suffer. Instead of one or the other, we think it’s financially healthy to find a balance between the two.
To learn more about how to manage your money effectively, sign up for my free 7-day email course where I teach you a step by step system to implement a simple money management system.
And if you’re looking for a budgeting app that will make it easy to create a play account and spend with intention, sign up for Qube Money. Qube Money is a simple and effective mobile banking and budgeting app with cash envelopes at the core. The spending technology requires intentionality making it easier to save money and stick to a budget.
By using these tools, you no longer have to feel stuck in between YOLO and saving money.
About the Author
Scott Henderson is the Marketing Manager at Qube Money and he runs a successful online blog Simplifinances. Scott is an Accredited Financial Counselor® and has been featured in major publications such as Fox Business, US News & World Report, The Simple Dollar, and many more. He holds a business degree from the University of Utah and a master’s degree in Personal Financial Planning from Texas Tech University.
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