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Having less money isn’t as bad as it might seem

Categories: Money, Your life


skinny-piggy-bank.jpgAs I’ve written about before, a bit more than six months ago our family went through a BIG life change. I quit my high-paying job in finance, we moved from our beloved-but-too-expensive-and-crazy New York City to a suburb of Boston, and I started a company (this here Work It, Mom!, of course!) As part of this transition we’ve gone from living on a fairly large income to living on mostly my husband’s income, which, while completely respectable, is a lot less than what we used to live on.

As this BIG change got closer I was completely freaked out. I was freaked out about leaving the city I came to love, moving to a new area, starting my own business, and changing our financial situation significantly. My husband and I are pretty frugal people - we saw our income increase 5x since our first jobs but we didn’t really change our life in a big way. Sure, I splurged on something for myself from to time, but I’d only buy things on sale and would agonize about spending significant sums of money just as much when I made lots of it as when I made little of it. But having the security of a steady and large paycheck is a nice luxury–your savings account grows, you don’t have to watch EVERY dollar, and the general stress level related to money is down.

So when the BIG change came, I was ready to be stressed and worried about money all the time and this impending stress made me very anxious. But as the weeks and months of our new life went on, the stress didn’t increase as much as I expected. It’s there, no doubt, but it’s not nearly as paralyzing as I anticipated.

To be honest, I am not quite sure why this is. I am an immigrant who has truly experienced what it’s like to be hungry and poor (welfare, food stamps, eating disguising canned fish — been there). My background has made me very conservative financially and I worry about our daughter’s college savings, our retirement and my parents’ retirement on a regular basis. (It’s OK to laugh at me now.) In other words, I am wired to stress about money and now that we have a lot less of it, I feel that I should be stressing more.

But I’m not.

My lower-than-anticipated money stress is probably due to the fact that I am fairly young and can always get another high-paying – or higher-paying – job (Translation: We’re don’t have much money now, but if I brush off my resume and give up this entrepreneurial obsession, we’ll be just fine.) And hey, there’s always that 1 in 10000 chance that Work It, Mom! becomes a successful business that pays me in more than just thank you notes from members. (Please keep those coming in the meantime!)

But it’s more than that. In the time since we’ve made our BIG life change I’ve figured out a few things about money that I am sure I should have known before — but as these things go, living it is different from reading about it:

Having less helps you appreciate more. An example: We never used to eat out too often before, but we’d do it a few times a week. Now it’s once a week max and we treat it as a special occasion. It’s more fun, we look forward to it, and to be honest, I don’t think we miss eating out that much.

Money alone cannot make you happy. We all know it, but I see it from a new angle. Money is important—it buys things we value, like time with family, trips together, being able to take care of loved ones. But having less money does not mean that you can’t do those things; it means that you have to do them differently. We invite friends over for dinner instead of meeting at a restaurants. We make more presents than we buy. You get the idea.

Spending money less often feels good. I’ve never been much of an impulse buyer, but I’ve definitely had my share of “Oh, this is only $20, let’s get it!” moments at Target. There’s no room for this now and know that we’re not wasting money on things we don’t NEED feels really good. (I am curious to see if Chris agrees with me as her family embarks on an awesome experiment of no discretionary spending.)

Liking your job makes up (somewhat) for making less money. Money is necessary and when you don’t have enough for necessities I doubt that liking your job makes a difference. But I can tell you that going from a job I hated where I made a ton of money to a job I love where I hardly make any is, so far, a net positive in terms of how I feel about my life.

I won’t lie and say that some days I don’t miss the security of a fat paycheck or knowing that yes, we can spend $300 on dinner and be totally fine. (My husband is laughing now because when we had money we did this maybe twice!) But having a lot less money has had much less impact on our life than I anticipated.

Now I’ll just have to find something else to be anxious about… let me go check those traffic numbers for!

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8 comments so far...

  • If you view money ONLY as a means to spend, then I would agree with your perspective. However, IMHO, money equates to security. My emergency fund, my 401k, my Roth, my daughter’s 529, other investments, etc - all contributes to my security (present and future). Security reduces stress. Reduced stress leads to a healthier lifestyle. Good health leads to a better quality of life. Quality of life leads to happiness.

    I’m not saying money buys happiness, but it’s all relative, depending on your perspective. Therefore, I will not for one minute convince myself believe that I’m ok with earning LESS money. The more the merrier! I can still appreciate the hard times because I’ve been there. Doesn’t mean I want to see them again, but I can appreciate what it’s like to have less.

    Lastly, earning less doesn’t mean one spends less - most people just use credit to fill the gap and keep up with the Jones’.

    I see where you’re coming from but I think that’s exactly what I was trying to get at. What I’m discovering in this stage of my life is that when there is enough for necessities (this includes savings, which for our family, is a necessity, not a choice), money plays a less important role in life satisfaction than I expected.
    I think your point about stress is a great one — less stress is key to a better lifestyle. And that’s why I included the point about liking my job — I used to have a high-paying job that I hated and I was stressed. I am experiencing less stress with a job I like that makes less money. Now, if I could have both I’d do it in a minute:)

    Single Ma  |  January 3rd, 2008 at 5:49 pm

  • I am with you AGAIN! I will be honest, I DO MISS A LITTLE OF MY OWN financial freedom. My husband and I had quite a few of those expensive dinners. We definitely indulged in having a good time, especially when we were without kids. We should have been more frugal. Oh well…live and learn.

    Yours words speak the truth. The bottom line is that we all get 1 life and if you can live & live securely with out losing life’s neccessities; then you’re doing just fine.

    Health is also taken for granted. When my son was born and we had a little scare, it was like I had a football stadium of lights flash on me. I honestly don’t know how many lights stadiums have but I think a lot(not sports fan)

    Living in NYC can definitely make a person who is making six figure plus feel like they have less than. Isn’t that amazing? I personally felt that way quite a bit.

    As I was walking my dog tonight and the cold wind was cutting through my forehead like i have never felt, I got a little bummed that we couldn’t afford to go to Florida this christmas.

    There are many days I feel guilty for putting the financial burden on my husband but I know he appreciates what I do(even when he leaves dishes in the sink).

    Being a stay at home mom with an urge and craving to become an entrepreneur can be so hard some days but I have never been happier. Now….can you imagine how insanely happy I would be with a little more mula! The day will come for all.

    Nataly - I REALLY think this will happen for you!

    First of all, thank you — I appreciate the confidence:)
    And NYC completely corrupts you. We made a lot of money but were surrounded by friends who were millionaires by 30. Real estate was expensive, we were facing paying $30k+ for school for our daughter, you know the story. I do think that my reduced money stress has something to do with leaving NYC (although I miss it!)

    momof2lovelies  |  January 3rd, 2008 at 9:13 pm

  • Ugh, I’m a money stresser, too. I come from nothing, have worked since I was really young, paid for my own college while working and whatnot and also know what it’s like to happily and excitedly pay for dinner for everyone just because I can. I’m always worried about how much we’re saving, how we can do better (doesn’t mean I always put it into action, though), and how it will make us happier to have a better cushion. Actually, I used to be more stressed about money but in the past year I’ve learned some great things. One is that as soon as we, hubby and I, realized that it’s great for the kids if we can save for their college, it will be even better if we have the money to retire and not have to worry them later on. So we don’t save for their college yet. Yes, we want them to go to college and yes, if we have the money when they go then we’ll certainly help, but it won’t be the end of the world if they have to get loans like Mommy did. And our financial planner agreed that it was a great plan for us! That helped make us feel like it was a good decision.

    What you say hits home here as we’re getting ready to make some big changes that could change our finances drastically. It will be so great if you can fully let go of that money stress and I hope it truly happens for you. Heehee, maybe you should print out all of our love-WIM-letters on green paper that looks like money and throw it around and roll in it every time you’re feeling anxious!!

    Mandy - love the idea of printing out the emails from members:), thanks for the laugh.
    I look forward to updates from you on your changes — from what I’ve learned about you, I think you can handle pretty much anything.

    Mandy  |  January 3rd, 2008 at 10:51 pm

  • THANK YOU for sharing this. I’ve been considering making a career change, and even going back to school, but it will mean giving up a job with great benefits and a decent salary. My husband makes a good living, but with our combined wages, we make a very good living. My husband assures me that we can live on his salary alone, but I am right in that freak out mode of not wanting to give up that financial security. I know you’re right — we hardly experienced any change in lifestyle when I switched from full-time to part-time work. But the thought of removing my income completely, without some income to fall back on, gives me the sweats.

    Amy - I was literally unable to sleep and was anxious all the time for months before we made THE change. Those were some of the toughest months I remember and in retrospect, it was wasted energy on my part. I’d made the decision and should have just accepted it and trusted that we could deal. But of course, easier said than done. I look forward to hearing about your changes and plans!

    Amy S.  |  January 3rd, 2008 at 11:56 pm

  • Another one in agreement as I plan to reduce my work hours to part-time. I KNOW I want that for my family, but having less makes me nervous about it (and makes my husband even more nervous.) Thanks for sharing your story, Nataly, and pointing out that we’ll still be able to do things we value, we’ll just have to do them differently. Your successful BIG change makes me feel like my family can probably handle our impending MEDIUM-SIZED one. :)

    Lee Thrash  |  January 4th, 2008 at 10:39 am

  • This is a very interesting topic, and interesting post. It’s meaningful to me because when my first daughter was born, I quit my full-time job (and later my second, part-time job too) to be home with her (and then her baby sister also) full-time. On the one hand, when I did it, I didn’t think we’d be able to last financially for more than a year–at most! And now it is 3-1/2 years later. It’s true that you DO make adjustments and do things differently and don’t miss a lot of what you think you will. (We go out to eat approximately four or five times a YEAR now. Yes, seriously. That may sound horrifying, but in all honesty we DON’T miss it much at all, and it saves us a ton of money.)

    On the other hand, it’s hard for me to read this in some ways, because it’s clear that you do have a level of basic security that we don’t have in my household. We pay all our bills, in part because my husband picked up a 2nd part-time job, but we put nothing in savings or college funds (and we were forced to use most of our previous savings to buy our current house when we unexpectedly moved 2 years ago), and very minimal amounts into retirement (far less than needed). And we are the only family we know with NO CELL PHONE. (Can you imagine?)

    So, to some, our “basics” are covered: we have a roof over our heads, food to eat and bills paid, clothes and necessities for our girls (including modest amounts of toys and occasional things like educational activities/classes). But to us, and to our equivalent “peer” group, we’re definitely barely squeaking by after this change of ours.

    Like you, Nataly, part of what makes me less anxious about this (though I am still anxious) is the knowledge that, with a Ph.D. and successful pre-baby career, I can always get another job. But at the same time, it bothers me more than words can say that, just because right now our family wishes our very young children to have parent-only care, we are barely making it. I have to admit I lose sleep about this on a regular basis!

    Thanks for the thought-provoking post!

    Shannon -
    Thanks for your thoughtful comments, I really appreciate learning about the different perspectives as I think this is an important topic, one we all think about a lot. And yes, you are right - we are able to save a little, which is important.

    I think the point you make about the peer group is important - something I forgot to write about. Because of where we lived and worked, most of our peer group made tons of money - insane amounts of money for people our age. It is still mostly true, although we know of a few other entrepreneur families that changed their lifestyles to chase the dream:) I’ve read a lot about money and happiness and all studies indicate that it is about relative income - relative to your peer group. So that is a point of stress, for sure - our peer group, our friends, make a lot more money, and we often say no to doing things with them because we don’t want to spend that much. Again, I think our situation is temporary - less than 5 years - so that reduces some stress, but it’s definitely there in those situations.

    Shannon  |  January 4th, 2008 at 2:33 pm

  • Response back to Nataly: Yes, you are spot-on about the peer group thing. My social circle was and is comprised of a ton of adults with post-graduate degrees and impressive careers, and we happen to live in a town that, while small and in the Midwest, happens to be home to a very elite college and near a major metropolitan area with a big airport and lots of hospitals. In other words, in my small community there are an overabundance of pilots, doctors, and well-paid academics (as opposed to more typical academics, who are generally not very well-paid!). It does make a huge difference to feel like you can’t easily afford the housing in your area, or the “extras” that everyone else seems to have, when you’ve given up one entire income. While I hate to be the type of person who compares herself to others, I can definitely see the link between money/happiness and status of one’s peer group. Great point!

    Shannon  |  January 4th, 2008 at 8:25 pm

  • Your post struck a chord with many of us. I am lucky to live in a community where the cost of living is very reasonable, even quite low. It makes money less of a stress factor. The work-related stress comes more from our family life and the trade-offs when our job schedules overlap. At those times, I wonder if we could give up one job or if one of us could cut down to part time.

    Daisy  |  January 5th, 2008 at 9:18 pm