CoastFIRE: Make your purchases worth something

One of the best financial decisions you can make is to take control of your spending. Most people when they hear that, they think budgets, cutting back, being frugal, no fun, no eating out, etc, etc. I would like to change that definition just a little bit. I would argue that if you are CoastFIRE or even on the FIRE journey, then you probably are already frugal and aware of your money. I think we need to focus more on the returns on our spending.

We spend money all the time, we are a consumer society but have we thought about what we are spending on. People track and budget their money, but are they really taking the time to be critical of the different buckets. If you love eating out and trying new restaraunts why is it equally weighted in your budget as clothing. If you love travel but live in a walkable city why are you paying for that car you barely use. Our money is a tool, the same way you wouldn't use a drill to saw wood, you shouldn't use money for its unintended purpose.

The intended purpose of money is to buy the things in your life with the greatest rate of return.

We should cut out anything that does not give us immense joy from our spending ruthlessly. If you love biking then spend freely on that but remove the cost of something does not bring you joy. Get rid of your gym membership if you only use it rarely, reduce spending on drinking out, whatever you might have taking up financial and time space. This strategy will give you more money in your pocket for investing, saving, and pursuing your hobby. The money you have the more freedom you have. Further than that it will also making you feel like you are not keeping yourself from enjoying your hobbies.

For example, I do not love the gym, or running but I love soccer and biking. So I spend money on equipment to do the sports I love rather than a monthly gym subscription or fancy running gear. I love travelling, eating out, and getting a beer at the pub, but I live in a walkable city and do not have a car. So all that money you would spend on insurance, maintenance, and car payments are now available for me to do the things I love.

There are trade offs to this strategy and some people will say they want it all. Others will see how this is beneficial.

Look at your spending with a fine comb and write down every payment that did not give you joy or was a necessity.

Its easy to figure out were you can save money, look at your spending. Write down every payment that was not a necessity or did not give you joy. Once you find the items that you are spending on that fit this category, bucket them. Put items in fast fashion, night outs, shitty food, unused hobby equipment, subscriptions, etc, etc. Start cutting, figure out what you don't want to spend on going forward. Then figure out what you want to up your spending on. Once that is clear you now need to ruthlessly follow these guidelines.

Do not waver and make your money have a purpose.