I love saving and it’s a game to me – but I’m starting to wonder if you can save too much

It won’t take long when a conversation about financial best practices pivots toward saving money and letting compound growth do its magic. Saving money strengthens your financial discipline and will help a lot when you retire.

However, some people end up with large nest eggs but don’t do much with them. That’s why a Redditor’s recent post has been hitting home in the Bogleheads subreddit.

In the post, the Redditor explains that some people over-save and under-live. The Redditor has been saving a lot of money but wants to strike a better balance between saving money and living a good life. 

I’ll share my thoughts on when it’s possible to save too much money, but it’s good to speak with a financial advisor if you can.

The Difference Between Cheap and Frugal Consumers

Saving a lot of money is good for long-term financial goals and stability, but there’s a point where you can save too much. If you’re cheap instead of frugal, you may want to use some of your savings.

It’s good to be frugal. Frugality is when you buy an older iPhone model to save money. The iPhone released a few years ago has almost all of the same features as the latest iPhone. 

However, it’s cheap to intentionally cut down on food to preserve your budget if you have $1 million sitting in the bank. Cutting down on necessities when you have a fortune indicates being cheap instead of frugal, but it extends into other areas as well.

Being cheap also means talking about the vacation you always want to do and never going, even if you have more than $1 million in the bank. It’s still good to be frugal when you go on a vacation. You can save money and still have a great time. However, denying yourself the vacation you’ve always wanted to take when you have more than enough is a sign that you’re saving too much.

See More of the World

The Redditor poses several insights in the post that focus on enjoying life now instead of stockpiling cash and never using it. The individual mentions that it’s better to be a broke 20-year-old than it is to be a 94-year-old Warren Buffett, despite his wealth.

You shouldn’t put off vacations and things you enjoy. It’s still good to do those things in moderation, but some people overcommit to saving and lose out on great opportunities. The Redditor mentions that a Europe backpack trip is a lot different when you are 20 years old compared to when you are 50 years old.

Accumulating money is good, but making that your sole objective can lead to regrets later down the road. Younger people won’t have as much financial flexibility as they get older and decide to lead families. It’s good to capitalize on opportunities while saving money instead of feeling the need to save every penny. 

Do What Makes You Happy

Making more money and saving more of it makes life easier. Accumulating money won’t solve all of your problems, and an obsession with it can lead to ruin. 

Writing a list of the things that make you happy can help you prioritize what matters the most. Developing new hobbies, spending more time with friends, and meeting new people can have a big impact on your life. Accumulating money makes each of those things easier, but focusing too much on saving money without using some of it can move those three goals out of reach.

When you pass away, you can’t take any of the money with you. While you can pass the money to your heirs, you can also teach them how to make money and develop career skills. Your heirs can become financially successful on their own. It’s still good to give money to your heirs if possible, but you don’t have to save every penny. You can work toward your financial goals while living a life that you enjoy.