Is being frugal really such a bad thing?

Your recent column stopped me in my tracks. You suggest that an “attachment to frugality” can limit your financial growth, and propose gradually increasing your capacity to spend, with the goal of “find[ing] yourself more inspired to want to create more wealth”. Huh? Might I ask you to have another think about your proposition? The experience of Warren Buffett suggests the nexus between frugality and limited financial growth is not fixed. If someone is content with their frugal lifestyle, why upend this?

First, a correction: I suggested increasing one’s capacity to enjoy spending money. I’m not saying to spend more – I’m saying to enjoy spending more. You can spend $100, happily or unhappily. For those attached to frugality, every expense hurts. This is what I was addressing.

Second, you are correct. If someone is content with their frugal lifestyle, and has no desire to change this, there’s no need to upend anything. I was not writing for that person. I was writing for the person who wants to continue to pursue more financial growth.

Now, I don’t know Warren Buffett, but I have coached multimillionaires who are wealthy on paper and still feel constrained, anxious, scared to spend, or unable to experience the level of enjoyment and freedom you truly desire.

They’re not frugal because they enjoy it or want to be – they’re frugal because it’s become a habit they can’t break. So, while Warren Buffett is celebrated for being a frugal billionaire, is that admirable, in and of itself?

But presumably your point was that you can be frugal and pursue financial growth. You can do both. Technically, it is possible. However, frugality can also be a constraint.

Do you really not enjoy spending money? Or are you just scared of spending it?

I want you to imagine you have “enough”. Maybe you have a fully paid-off home, you have enough in investments to cover a comfortable lifestyle. Now, would you choose to do the work to keep pursuing financial growth – even if you didn’t “need” more? For many people, the answer is “no”.

Why keep going, if you don’t need more? You wouldn’t. Unless – there is a level beyond need. After you are financially secure, the next level isn’t defined by need. No one needs to be rich. No one needs first-class flights or an extra bedroom. Those aren’t needs. They’re desires.

But if you’ve spent the past few decades being “financially responsible”, curtailing all your “wants” and only allowing yourself “needs”, then you might not have a great relationship with desire. You might be so conditioned to suppressing your desires, squashing them before they can even surface, that you might not even feel desire any more. This might even feel like contentment.

This takes some introspection. Are you really content? Or did you just suppress all desire? Do you really not enjoy spending money? Or are you just scared of spending it? Is there really nothing you want to spend money on? Or has frugality become an identity you’re attached to?

I’m not suggesting one should pursue growth beyond what they need. I’m not saying it’s wrong to live a life of frugality. It’s your life. Live it how you want.

What I’m saying is – if you do want to pursue a higher level of financial growth, being overly attached to frugality might become a constraint if it robs you of any inspiration to pursue further growth. You might find it easier and more enjoyable to continue pursuing growth if you gave yourself permission to enjoy the rewards of your work along the way.

This is applicable to many areas of life. If you have a sedentary lifestyle, you might lack any real motivation to pursue higher levels of fitness. Sure, it’s “good for you” – but that’s not a compelling source of motivation.

However, if there’s something you’re actually excited to do – such as climb a mountain with a friend, get in shape for your wedding, compete in a sport you enjoy – now you have a personal, compelling reason to pursue a higher level of fitness.

The difference is that when it comes to money, the dominant narrative is that spending is bad, and the goal should always be to spend less. If that’s your world view, then the idea of enjoying spending will feel triggering because spending isn’t to be enjoyed – it’s to be eliminated.

But the point isn’t to spend or not spend. The point is to experience life more fully. Does this require you to spend more? No. But does it mean it might be beneficial to stop grasping so tightly to money because you’re terrified to spend it? Yes.

And when you do, might the natural consequence of this be that you end up spending more? Maybe, but not necessarily. The key difference isn’t in the amount you’re spending – it’s the mindset with which you’re spending it.

Paridhi Jain is a money and mindset coach who combines practical strategies with mindset transformation to help clients create more freedom and fulfilment in wealth, work and life. Find Paridhi at: skilledsmart.com.au

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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