One of the constants of life these days is that there will always be something new and shiny to buy.
While discussing the new iPad Air, I told a friend I thought it was neat, but that I would never buy it, to which she replied:
“Why not? What are you even saving up for?”
That’s the big personal finance question at the center of everything, isn’t it? And it’s certainly not a rhetorical one. As I’m sure you’re aware, the aggressive student loan payments, the frugal living, the extra effort at work, and the hunt for better returns, have not been easy.
So what am I saving up for?
Is delayed gratification what I’m saving for?
In other words, am I just being frugal now so that I can go hog wild later?
Gosh I hope not.
It’s a common misconception that frugal living is just a trade-off across stages of life – that we’re giving up buying while we’re young and hoarding assets, so that on our 65th birthday we can crack open our 401ks and IRAs and buy every indulgent things we passed up as young people.
Yes, living out the last few years of my life comfortably is part of it, but if all I’m doing is trading happy times now for happy times later, then that certainly wouldn’t be enough.
For me, and many millennials, the ultimate financial goal is no longer a plush retirement. You might be surprised to find that it’s not a modest early retirement either and it certainly isn’t to buy more things or more experiences.
What I’m saving up to buy is freedom.
As it happens, I love my job. But like a lot of folks out there, I live in fear of losing my job for reasons outside of my control. Yes, I have an emergency fund so no, I don’t live paycheck-to-paycheck. But is living with a safety net of a few months really that much better?
This, of course, comes after finishing school where I worried whether my grades and networking skills would be good enough to land me a job when I graduated.
And before then, I worried whether the school I wanted to go to, the major I wanted to study, career path I wanted to head down, and life I wanted to lead, would leave me with enough money to pay the bills.
Maybe you see the pattern here.
I’ve spend the majority of my adult life working in public service, worked hard, been the recipient of lots of help, and gotten very lucky, and that’s allowed me to have fun even as I developed professionally. And yet, every decision was made with money in the back – if not the front – of my mind.
That doesn’t sound like freedom to me.
And this is why I’m paying off my loans so aggressively and why I’m fighting so hard to save money. It’s not to skip out on shiny things now so that I can have very shiny things as soon as I’m legally an old man.
It’s to get to a level of financial freedom that allows me to remove money from the equation in deciding what I do, the jobs I take, when I work, and even what I care about as soon as possible.
And I know that the sooner I start and the harder I work toward financial freedom now, the sooner I’ll get there.
So that was my answer. What are you saving up for?