Forward Frugality Rationalization
There's an idea that presented itself in my mind that has changed the way I think about savings, and I have decided to coin the idea Forward Frugality Rationalization - from here on out simply FFR. The concept is simple; Any amount of money you spend, you are stealing from your future self. You're taking money from an account which can more than likely benefit you more down the road if you instead saved it. Thinking critically about this idea, it can be applied to preparatory activities in everyday life. FFR should be used and considered wherever there is future opportunity to spend money, that can be minimized by taking action or spending money now instead of later.
An example of this would be considering that you spend 10-15 dollars per day going out with co-workers to lunch several times a week. Maybe you do it once a week. Maybe you do it 5 times a week. Doesn't matter - so long as it's something you become aware of and can begin to consider ahead of time. FFR applies to this concept by thinking about that money and those expensive lunches the night, day, or week before the event occurs. Knowing that without a plan to avoid the cost, you will almost certainly go out and spend money is ammunition enough to get started with your FFR goals taking shape. Practically speaking, you instead go to the store and buy stuff to make lunches in the fridge. Some deli meat, nice bread, a variety of vegetables, cheese, and maybe some crackers or something on the side. Ensure that you always have food in the fridge to make yourself a lunch before work.
After that battle has been won, the next step is to actually assemble that sandwich on your counter in the morning, and wrap it up to take with you to work. This is the part that I struggled with for so long until I fleshed out FFR in my mind. I never stopped to consider that the savings are double when you pack your lunch instead of going out, because not only are you not spending money on restaurants or fast food, but you're saving time by eating at your desk. It realistically only takes me 10 minutes to plow through a sandwich and chips, so I usually do that while performing some light duty desk work. Guess who leaves work an hour before all their co-workers since I started doing this? ---->This guy. Or you can be a suck up and work an extra hour a day, which is your prerogative. In my case, the extra 45 minutes to an hour that I leave before my peers opens up my evening to do further preparatory work if needed for FFR type activities. Now I can go to the store, buy dinner, and run some errands without interrupting my regularly scheduled nightly routine.
Without FFR, I might have never realized that spending $30 on groceries per week saves me $50 in lunch bills, and waking up 10 minutes earlier in the morning corresponds to me getting out of work 45 minutes to an hour earlier. This particular application feels more like a life-hack than a strategy. Thus is the FJJ way - a little investment up front yields an exponential benefit down the road - but in this case you see the benefit the same day.
Applying FFR to a Macroscopic View
The lunch was a simple example of how this method of thinking can yield immediate and tangible benefits for you life - what what about the bigger picture? How can forward rationalization apply to larger investments and decisions?
One thing that immediately pops into mind is cars. Cars cost a bit of money but really if you think about it they also offer a tremendous opportunity to save money. Let's say you were considering spending ~$25,000 on a new Honda. What if by employing FFR you decided just to get a clean, used, low mileage Honda for ~10,000$ (or a salvage vehicle.) All you have to do is a little extra maintenance on occasion and swallow your pride. Bam, right there you saved $15,000. How long does it take you to save 15k? maybe 6 months? You have literally just bought back half a year of your life by making this one simple decision.
Perhaps one of the most practical means of thinking about it is through retirement investments. Contributing to a 401k or some other account that you prefer, the more you put in now, the less you have to suffer in 10, 20 or 30 years when you realize that you don't have enough money to retire at 65 and are going to have to work until the day you die. Better to suffer now, in your youth, and reap the benefits of a carefree life when you are old. If you play your cards right, you might even be able to retire far sooner than you anticipate. Applying a principle such as saving 50% of your after tax income is one strategy to reach financial independence exponentially faster than people the same age as you. Not only does saving until it hurts reap a much younger retirement, it also teaches you to live with less - since you don't have the money to spend, you're not going to go out and blow it on shit you don't need.
Going back to the example of purchasing a salvage vehicle, I doubt anybody reaches their deathbed and regrets not paying a bunch for a new Honda. Instead - save that money, then when you are good and stable go live a good life helping people and enjoying it. That may sound a bit trite but that is why you are reading a financial blog right? To ultimately live a better life.