Yes, unfortunately for many people, life is short. We’ve all known people who have either died young or had some medical issues that have really limited their quality of life, and with that perspective, it’s not to be negative. It’s simply to say, okay, what do we do from a finance perspective? Because we often hear that we need to be paying off debt, we need to be saving for later, but at the same time, we want to enjoy life now.
How do we balance those? I always get questions on should we pay this off or should we have fun with our money or how much do I really need to save for later? And the answer is it’s always all about balance. The reason is you really don’t want to be on either extreme. Both places are no fun. You’ll be kicking yourself either way. If we can balance things out to where we can still enjoy life, but also not be buried in a crazy amount of debt and not be wishing that we had saved more for retirement or college or whatever later in life, then we’ll be in a much happier place.
If you think about the extremes, so picture spending all your money and then later in life you have a ton of debt and no retirement savings so you have to continue working. You’re wondering how you’re gonna get enough medical coverage. Is Social Security gonna be enough? How are we ever gonna pay off this debt if we ever do? You know, that’s not fun. So sure, great, maybe you bought a really nice car, maybe you went on a bunch of fancy trips and you had a really fun, great life up until the fact that you ran out of money and now you’re working because you’re 80 and you didn’t save anything along the way.
It sounds extreme, but it happens, and it’s not fun, and you’ll be kicking yourself later in life if you don’t set some money aside, but at the same time, we don’t want to be sitting there late in life wishing that we had done more. Maybe we’re loaded with money. Maybe we have more money for retirement than we would ever need and we’re passing money along and those are all great things, but maybe you missed some special memories. I’m not necessarily advocating buying a bunch of stuff because quite honestly we really don’t need as much stuff as we have now, but spending money on experiences could be really valuable, not just for yourself, but for your family, your friends.
So I think it’s important to not obsess over making sure that we save every penny that we earn, super, super tight with money all the time, if we have the ability to enjoy it a little bit, and I’m saying don’t crazy. We don’t all need to go buy Lamborghinis and spend, you know, 20, $30,000 on vacations every year. That’s not the point. Maybe there’s a trip that you can take with your family that they’ll remember for the rest of their lives and that doesn’t have to cost a ton of money. Take it, just take the trip, it’ll be fun. You’ll still get your debt paid off. As long as you’re still saving for later in life, take the trip. Spend that little bit of extra, enjoy life a little bit, don’t spend all your money. Don’t go on some crazy buying spree and at the same time be putting nothing in a retirement account. That’s kind of crazy, but the point I want to emphasize is that there’s a balance. It is okay to spend some money and enjoy it, especially on experiences and especially on experiences with other people. You’ll get a lot of mental value out of that and a lot of great memories, but let’s also make sure that we’re putting money aside for later and saving money for retirement, college, and also paying off debt. Those are also very important.
So don’t try to obsess over one versus the other. Which one’s right, which one’s wrong, which one’s good or bad. Yes, life is short. We want to make sure we’re enjoying it now. We also want to make sure we can enjoy it later. Have some balance, have some fun, and make sure that you’re managing your money appropriately for the long-term.