Moderation in Everything But Debt
One of my father’s phrases that stuck with me from my childhood is “moderation in everything.” It is one of those things that you don’t really understand at the time, but as you get older it really starts to make sense. What he meant was it is okay to have a little bit of everything in life. “Variety is the spice of life” also comes to mind. In other words you can’t sit at home and never take trips or spending time with friends. You’ve got to balance everything to get the most out of your life.
Is Moderate Living Achievable?
Moderate living is not hard to achieve, but to be successful you must have discipline over your finances. At the end of the day your finances control how often you go out with friends, how many vacations you take, and how prepared you are for emergencies.
For many Americans there is no problem with spending money, going out with friends, and going on vacations. We’re a nation where a majority of individuals live paycheck to paycheck.
That’s where the financial discipline comes in. Spending money is fine, but you can’t spend everything (and then some) every month.
How to Live in Moderation
I like to call living moderately the trick of balancing living like a rock star and living like a hermit. You’ve got to take your income and divvy it up to spend some on expenses, save some for a rainy day, and save some for those amazing trips.
Here’s how I achieve moderation in my life:
- We work hard and get paid for that work.
- We use a monthly budget and the money automatically goes towards categories for monthly expenses, saving, and fun.
- We plan for worst case scenarios (unemployment, major emergencies) and save to meet that plan.
- We also plan out nice trips and save up toward those.
We cover our monthly expenses first, our emergency and other savings next, and our fun last.
If you were a hermit you would take all that income and cover your monthly expenses first and the rest would go toward your savings. Financially that would be very wise and you would have a great savings account. Then again you probably wouldn’t have many friends and you wouldn’t be living life to the fullest.
If you were a rock star you would try to minimize your monthly expenses, none of the income would go to savings, and everything would go to fun, fun, and more fun.
It’s a balance. Try to fall somewhere in the middle.
Moderation in All Things Except Debt
While I think my dad is a wise man, I think the phrase “moderation in everything” needs a slight addition: “but debt!”
Your moderation should not look like this:
- income
- saving
- spending
- debt
If debt is part of your plan then you’re essentially doubling up on spending in an unhealthy manner. If you’re adding more debt then you’re spending more than you can afford. If you’re adding on debt you’re probably not saving money.
Embrace the life of moderation. Live life to the fullest while still making wise decisions. Life is too short to do otherwise.
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