If you’re looking for ways to save more money, look no further than the household budget. This spending plan helps you cut excess expenses to free up cash you can put towards what really matters: your future. But with all your spending energy focused on tomorrow, you can end up forgetting about your quality of life today. When you’re trying to save as much as possible, you can wind up suffering from frugal fatigue.
What is Frugal Fatigue?
Frugal fatigue — or budget burnout — is that feeling of exhaustion you get after following an incredibly tight spending plan for a long time.
Saving money is hard work, after all. Day-in, day-out, you have to crunch the numbers, deliberate every purchase, and hunt down the best deals when you’re ready to pull the trigger.
Frugal fatigue sets in when your penny-pinching ways wear you out. You can wind up splurging on something costly or worse — for some people, one spending mistake makes them give up on budgeting altogether.
A Household Budget Needs Balance to Work
It’s easy to approach a budget with an all-or-nothing attitude — either you’re saving money or overspending it with nothing in between.
But like many things in life, a budget isn’t so black-and-white. There are shades of grey in any spending plan with a lot of room between savvy saver and terrible spendthrift.
Your success hinges on finding a balance between these two extremes. You should limit your spending so that you can pay bills and achieve financial goals, but you shouldn’t limit it so much that you can’t splurge and enjoy life.
How Much Fun Spending Can You Afford?
There’s no singular dollar amount that will work for everyone. You’ll have to come up with this number on your own, but looking at these three factors for help.
Until you find a way to earn more money, your net income represents the hard limit of your monthly spending. Once you cover the cost of living, that’s all you have left to work with.
If you have payday loans, lines of credit, or installment loans out in your name, consider these as part of your essential bills. Make sure your budget covers their payments before you allot cash for something fun.
You may even want to put more towards credit cards or installment loans for bad credit, as long as there are no penalties for pre-payments. This may help you pay off your bills faster and reduce what you spend in interest.
Saving for a rainy day, college tuition, or your retirement takes some of your spending power away from the fun stuff. Depending on how serious you are about these goals, you may have to prioritize them over splurging.
The 50-20-30 Budget Can Help
The 50-20-30 Budget helps you balance your priorities. It breaks down your monthly spending into three categories (needs, savings, wants) and assigns them a fraction of your net income.
Your needs take up half your income by covering things like rent, utilities, groceries, and the minimum payments on lines of credit and installment loans.
This leaves the other half of your income covering savings and wants. If you aim to save 20 percent of your income, you have a whopping 30 percent for your wants like streaming subscriptions, travel, cosmetic renovations, clothes shopping, and more.
Beat Frugal Fatigue without Compromising Your Finances
No one’s immune to frugal fatigue, but you can reduce the chances of getting it by being kind to yourself. A strict budget that doesn’t plan for fun won’t do you any favors if you burn out. Structuring your budget around a little spending can actually help you save in the long run.