June 30, 2011, 6:00 am

Why Earning More Money Trumps Frugality

by: MD    Category: Other Financial Articles
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Earning More or Saving More?
Do you subscribe to the philosophy of daily frugality or would you rather just make more money? I often think about the discussion of comparing making more money with frugality. For some reason I haven’t really covered this topic in my writing here. Yet it’s a topic that I often discuss in my real life interactions. I’m positive that this discussion is also something that you guys have though about before. Let’s jump into it.

Why do I prefer to focus on earning more money instead of wanting to always cut back on spending?

There’s a lot that I want to do and experience.

I find that money is a tool for me. Money is a tool that allows me to experience new things. I figure that the more money I make, the more that I can experience in life. Saving money allows me to plan for trips and new experiences. Making more money gives me the opportunity to go on more trips and experience more. I just find that there’s so much you can do when you have more money available to you.

Earning more money is fun.

I’m not sure why, but I get excited every time I close a new advertising deal. I love the idea of using my God given skills to make some extra money. I find it much more fun to use my spare time to earn more money than I do clipping coupons or cutting back on things that I enjoy. What do you think? Is it more fun to make extra money or to save money?

Cutting back can be painful.

I wanted to share a quick story here. A few Saturdays ago a bunch of us were planning on going out to this club in town. I personally like to go for around midnight because that’s when the place picks up. The only setback is that you have to pay a cover of $7 after 11. My friend (a very frugal man) that was coming with us persisted that we show up around 10:30 to get free cover. Long story short, everyone had to rush to make it there on time. This put a few people in a bad mood. All of this hassle to save some money. The worst part was that we didn’t even make the cutoff and still had to pay the cover. I got to hear this friend complain about it all night. For me, making more money allows me to have some financial flexibility that I normally wouldn’t without an additional cash flow.

There are many ways that you can be clever and tactical with your frugality. Sadly, there are also many instances where frugality can be painful. I need my morning coffee. I enjoy going out for dinner with friends. I don’t want to have to cut back on these areas. I would rather find ways to make more money so that I can enjoy myself more often.

There’s a ceiling on saving money.

There’s only so much money that you can save. I really don’t think that you can frugal your way to riches. When it comes to making more money, there really is no limit. You limit yourself. The only thing holding you back is you. Sure you can use the excuse of time and hours in a day. The counterpoint to the time argument is that you can read the 4-Hour Workweek and learn how to scale your business to earn money when you sleep. The other reality is that very few of us actually use our time effectively. We could all find an hour a day or so where we turn off the television and work on some productive projects. When it comes to saving money, there’s just only so much that you can save from if you’re not earning a good chunk of change.

Turn it over to the readers: Do you see yourself attempting to save more money in the future? Do you want to earn more money going forward? What’s your take on this discussion? Which strategy do you prefer for building long term savings?

(photo credit: lisaclarke)

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Comments

by: The Financial Blogger | June 30th, 2011 (7:06 am)

I’m totally with you MD!
I’m actually very bad at being frugal since I hate to cut down on my lifestyle. Luckily, I’m pretty good on increasing my income and find extra money 😉

I think the key is to create more money but not spend it all. At one point, one must start to pay off its debts faster with his extra income.

I would much rather make more money than try to be as frugal as possible. Using my creative talents to build something makes me feel much better than finding ways to cut.

Totally agree… money is a tool that opens doors and provides options. (not all, but lots of them)

As you stated, you can only save so much, but there is NO limit to earnings. Very important point. I know from conversations, most people find it harder to increase your income, but I think once you get started it’s actually the other way around.

One other thing as the previous poster stated… keep some of the extra earnings to generate more earnings via investments. That way you end up with a nice snowballing effect.

This is a topic that is very near and dear to my heart as well. The whole point to my site is not to be frugal in such a way that you have to cut back and it wrecks your life. It is to find ways to save money without really sacrificing anything in terms of your lifestyle and then use those savings so you can enhance your life even further.

I always say that if you have a clear path towards earning significantly more money, then you should devote your time to that effort. However, if that avenue is limited or non-existent then there are plenty of ways to save money that don’t involve trimming your lifestyle in the slightest.

I feel you can save more money by earning more money. I’m with you; I want to experience a lot of things, and cutting back can be hard. There’s only so much you can cut back on, but your potential to earn more money has no ceiling.

I think it’s faster initially to save money by cutting back and for most people it’s more approachable. However, I completely agree that it has rapidly diminishing returns for the effort you put in and there is definitely a limit to how low you can go. Earning more is the direction I’m going now. I just signed a contract to earn several thousand more over the course of the summer 🙂

I see many people blogging about “earning” money through ebaying or craigslisting their stuff which to me doesn’t really count. You had to pay for the stuff in the first place and you’re still selling for less than purchase price. Plus, in theory, the more responsible you are with your money the less stuff you’ll have to sell either because you will buy less or you buy things that hold your interest longer.

excellent topic and i am all in with you as well. frugality is the obvious – easy route, and while it is a good one, there is nothing like making more to expedite achieving one’s goals and objectives

[…] Why Earning More Money Trumps Frugality @ […]

@No Debt MBA,

funny you say that as I never got why people were are interested in learning how to sell something for a fraction of what they originally paid… this is not a good “making money idea”!

[…] Why Earning More Money Trumps Frugality (via The Financial Blogger) […]

I see it 2 ways. 1) It’s great to earn more money if you can. I love to travel & experience new things too! 2) You might need to know how to live on less someday. It’s good to pick up some skills in living below your means. You don’t have to pinch pennies, but when making a large purchase, it’s smart to get a good deal. Doing your homework then can save enough for another trip!

No matter how much money you make, you’ll need an emergency fund. Bottom line: be smart with your money!

I agree that more time should be spent earning more money, rather than devoting too much time to frugality. I consider my self to be a frugal minded person, but I pick and choose the things in my life that I am frugal with. It doesn’t bother me to be frugal in spending on grocery items. However, there are other things that I am willing to spend good money on in order to have the best experience, such as vacation. In the same breath, when you spend frugally on certain things, there is more money left over to spend lavishly on the things that you really love.

I spent way too much of my early adulthood concentrating on frugaulity, when I should have been concentrating on my income. It was a huge mistake and I tell this to anyone who will listen.

I am still a frugal person and I hate to waste anything. But, I refuse to spend large amounts of time to save small amounts of money. Life is so much more enjoyable living on a reasonable income, both for me and for my family.

I see no reason why you cannot do both. I am frugal so I can have money for down payments to buy my rental properties which give me income. My DH and I continue to find deals to be able to have our fun, but pay less than most but we also look towards increasing our income when we can. To be wealth you must put money in investments, to do so you must spend less than you earn.

[…] Why Earning More Money Trumps Frugality: The Financial Blogger takes a look at earning money, and why it can be superior to frugality. Reach for your goals, and make an effort to earn the money you need to succeed. […]

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[…] been really getting into the core of money management topics. I shared with you why I think that earning more money trumps frugality and I went into the importance of saving money in your […]