Awhile back my husband and I redid our monthly budget, updating it with his salary raise, our new life insurance policy, and the money we’re putting into our various savings and retirement accounts. We discovered we were saving 26% of our take home income!
Are we saving too much?
Here’s my internal monologue.
Yes, it’s okay to spend a little more every month!
- Life’s too short to save so much! Who knows, the end of our lives may be much closer than we think.
- We should indulge in the treats we really love – like getting a massage every month, instead of two or three times a year.
- We have a strong safety net, what with our diverse investments, including stocks and real estate. It’s unlikely that a little extra spending will severely impact our long term savings.
- We can always scale back later.
- We should enjoy our lives and not just worry about the future.
- We have plenty of friends who make less money than us who go out and spend money more often than us. If they can afford it, can’t we?
No, keep saving at our current rate!
- The more we save now, the sooner we can retire!
- There are plenty of cheap and free ways to have fun. And how about date night at the gym? Without kids, that DOES sound like a date!
- We can’t depend on government social security programs to be around in 25 years when we want to retire.
- Who knows what medical costs will be by the time we retire?! I know we’ll be covered by Medicare when we hit 65, but we may need long term care or prescriptions that lie outside of Medicare. That extra medical insurance and medical expenses are likely to be extremely expensive.
- Our family may need to spend our savings on major medical illnesses, periods of unemployment, college tuition, or other unforeseen expenses.
- We have major expenses coming up in the next 1-5 years, like replacing one or both of our two relatively old cars. (2003 Mini with 117,000 and a 2006 Honda Element with 115,000 miles)
- We may buy a new home or take on renovation projects on our current home.
- We should try harder to be satisfied with our current “fun” budget, which lets us order take out 1-3 times a month, and hire a babysitter to go out about twice a month.