I love to analyze things and enjoy looking at the math behind different concepts. While I find it interesting I also find it exhausting and I also find the idea that everything needs to be optimized exhausting.
This is in response to the endless arguments in personal finance. These arguments include budgets and whether they are needed, the debt snowball vs. the debt avalanche methods, mutual funds or index funds, paying off your home mortgage early, math vs. emotions and behavior, emergency fund amounts and where the funds are kept and finally, whether you agree with Dave Ramsey or not. I am not going to get into these arguments although I have opinions on each one and have written about a few of them as linked above.
This is about looking at the time and energy you have and doing the best with those and moving on.
Our Current Reality
Last week we welcomed our second baby into this world. We now have a 2-year-old and a 5-day old. Both are boys which will be a lot of fun but both have very different needs now. It is so crazy to see how much our 2-year-old has developed since he was born when looking at our newborn. We knew this would be tough but it has been more overwhelming than expected.
Right now, the idea of optimization is nonexistent. We are simply about the basics at this moment. Eating, sleeping (them not us) and just plain staying alive.
Even without this optimization of our time and decisions we will still achieve a lot and get far. Will it be perfect? No, but it will be good enough.
How it Relates to Personal Finance
So how does this relate to personal finance and these stupid arguments that we all have or Facebook groups or in blog comments? Well, if you spend less than you make, save or invest, get rid of debt or avoid it to begin with then you will be ahead of most people and you will be fine. By arguing over which way to pay off debt or whether you agree with every bit of advice from Dave Ramsey is really missing the point.
The point is that there are many ways to get to where you want to be if you simply follow that very general advice. Every decision you make along the way doesn’t have to be perfect. You can choose which order to pay down your debt without it being perfect and still be fine. You can decide to pay your house off early in lieu of investing that money and be OK. You can worship Dave Ramsey or you can worship Mr. Money Mustache. No one is stupid because they decided to pay off debt using the snowball method or listen to Dave Ramsey or aspire to retire early.
If you don’t like what I’ve written on some of these topics, fine. It is OK to disagree with me or anyone else but let’s get rid of the endless bickering about these topics. This is advice I need to hear myself at times.
Optimization Can Be Exhausting
It is fine to optimize your life and your finances but it seems to be an endless search for something better at times. It just gets exhausting because there is always something else around the corner that could be better.
Here is my advice. Just do what works for you by making the best decision you can at the time. If you get the opportunity to make an improvement, do it. If not, there will be another opportunity. If you make a mistake, don’t fret it, you can always fix it later. This is more advice I need to hear myself at times.
Just Do This
Don’t feel that you always must be improving. Sometimes you can just be and enjoy life.
To repeat the general advice from above, make the following your focus.
- Spend less than you make
- Save/invest the rest
- Pay off your debt or avoid it to begin with
If you do that, you will be more than fine and you can get there however you want. Be emotional about your journey or be all about the math, but just choose what you want to be and enjoy the ride.
Get to Work Earlier – Personal Challenge – Follow-Up
I have actually witnessed two people ARGUING about snowball v avalanche. I was thinking, “Just pay it off. Just. Pay. It. Off.” Hope you get some sleep soon.
Thanks Priscilla. Things are getting better as we make this adjustment. I’ve arugued more times than I’d like to admit about that very thing but your advice is spot. Just pay it off. If one works better for you than do it. If you don’t like it then switch methods. It is your life.
Ayup. I think we’re drawn to the idea of people giving us our very own roadmap to FIRE because that’s the easy thing to do. But the reality is that only we know what’s best for us. Sometimes investing beats out debt payoff and vice versa. I adore people arguing over these things; I just grab some popcorn and enjoy the banter. 😉
And congrats on the little one! I hope you get some much-needed rest.
Thanks!
Finance is one of those things where people want to make it more complicated than it really is. Once you get your head into it you see that it really isn’t that scary and you can see the success others have had and can more easily decide what is best for you. One thing I do find funny though is someone giving advice about what is best to do when they haven’t been through it and try to dismiss the advice of those that have been through it. You don’t have to have gone through something in order to know what is best but don’t be surprised when emotion creeps into the argument and you are trying to be purely pragmatic.