Here's my take. Frugality is born of necessity. When it stops being necessary, it becomes a burden.
Budgeting is like dieting. It's hard to stick with because you feel deprived of SOMETHING. If you don't need to do it, why would you? It's a difficult mental hurdle to get over, and if you don't really NEED to, why stress about it?
I don't diet. I also don't budget. I set goals for savings that are realistic, but the thought of counting every dollar that leaves our account sounds like such a chore and it's overkill.
It really sounds like you guys are in good financial shape.
when did frugality become a negative? it literally means to be economical. the word comes from the latin 'frux' meaning 'fruit' or 'produce'. a 'frugal' individual ensures that the fruits of their labor don't go to waste. many practice frugal habits in wide sweeping aspects of their lives without even realizing b/c they choose not to be wasteful.
i don't see budgeting as something difficult either. it's simply a matter of making an estimate of income and expenditures over a set period of time. sure, some debt reduction plans call for naming every dollar, tracking every penny spent but it can be as simple as what i just did within 30 minutes this week in anticipation of 2023-
pulled out an old steno pad and with an eye to inflation i upped the amounts i spent in 2022 to new 2023 amounts-
wrote a column of all known monthly expenses (utilities,streaming services,cell,garbage, life insurance policies, regular monthly prescriptions/co pays for known meds and appointments)
wrote another column of all known quarterly expenses (some yard/property upkeep)
wrote another column of all known bi-annual expenses (property taxes, auto tune ups, auto insurance, sirius plan)
wrote a final column of yearly (christmas, homeowners insurance, atv insurance, umbrella coverage).
totaled them all and looked to our net income and how much was left at which point i made a decision on how much i wanted to go towards our 'household budget' which includes food (eating in or out), entertainment, paper goods, washing and bathing goods, essential clothing-also taking into consideration inflationary trends and vehicle fuel.
i total them all together and put them side by side with my net income-if i'm comfortable with the resulting remaining net monies left over-that becomes our savings which we use for whatever we see fit, in some years it's been travel, more often though it's been home improvements and enhancement that provide us with a safer and more comfortable quality of life. if i'm not comfortable with the amount then i consider cutbacks i can make in other areas.
all my accounts are set up on auto transfers from the main accounts we get our pensions and ss from-
my bank accounts are set up so that all the monthly expenses go into one account-and are paid out immediately. quarterly/biannually and yearly go into a 'reserve' (what i named it) account-when a bill comes due it transfers out to pay it. the only exception is 'christmas' which get it's own account so i can track what i've already bought throughout the year.
as for my 'household' money-it goes into a checking account and if i use less one month it rolls over for use the next month.
I don't agree. Part of knowing whether you have the assets to retire is knowing your budget in retirement, so you can run the calcs to see if you have enough money (accounting for things like inflation - I have a couple of retired family members who have been bitten hard by that this year). Ask any financial planner if you have enough to retire, and one of their first questions should be "what's your budget in retirement"? You can't even begin to know if you have enough if you don't know what you are going to be spending.
i think this is very important, unfortunately i think far to many couple/partners have differing views of what they wanted their retirement to look like. i've known couples who thought the had to same dream of traveling in maxed out rv when in reality only one wanted to sell the family home and do it full time while the other only every wanted to do it a few months a year and was aghast at selling their home.
i know others who thought they could travel around and around to their kids and grands for the bulk of the year. well, between travel costs and the old 'guests are like fish' saying-that worked for maybe the first year but then it petered out.
in both these scenarios major life changes/major expenses/major expenditures of assets can result in decades of financial hardship. so people need to get on the same page.
When the COVID shutdowns happened we ran the math - we were SAVING > $1000/MONTH (!). We had gotten stuck in the rut of running off to work ($ for commute), running back to get the kids from school to take them to their activities ($ for those), then having no time or energy to cook at home, meaning we'd go out instead ($$ money for that). We also had stopped going on vacations, going to the gym, the list goes on
i had some high hopes for some friends and neighbors who we so gleeful at how much they were saving due to the pandemic. gas, eating out, going out for drinks, going to sporting activities, eliminating leisure travel....they were SO EXCITED to see how much they were saving, some used it for savings (first they really had) and some for home reno/improvements. thing is though-now that we are in a less restrictive environment they are falling back into their high spending habits and complaining about the same stuff they complained about before, i think the covid restrictions offered people an opportunity to come to grips with what they can and cannot do without and it will be interesting to see if people choose to retain some of their mid covid habits (home cooked foods, leftovers, far fewer kid's activities, vacations becoming a yearly or every other vs. seasonal. all those savings add up)
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