OK, I ended up going on that vacation which is why I haven’t written a new blog entry for a few weeks. Sorry for the lack of entries and thank you for your input on my last post. I want to continue on this topic of whether you or me deserve a vacation while in debt. As we can see with all your comments, everyone’s got an opinion and they’re pretty diverse.
I asked Gail whether she thought a girl like me deserved to go on a trip and this was her response:
For a girl who calls herself an Unspender, you’re doing a lot of shopping: there’s the trip to Hong Kong, the new laptop (yeah, I know, the ipod was free), the wedding in Calgary and now the trip to Vancouver. Only you can decide if these are worth the long-term costs. It’s your money and your life. But don’t delude yourself. If you are spending money you haven’t yet earned, you’re not going to be in a Happy Place when a crisis hits. And if you think having a 5-year-old laptop was a crisis, think again. You may think you NEED a vacation, but you WANT a vacation. You NEED a roof, enough food, and clothes to keep you warm. You NEED to be able to get to and from work. (Okay, if you work on the new laptop, it might be a NEED, but only if you couldn’t work on the old laptop.) I’m not going to tell people they shouldn’t take vacations when they have debt. I do believe you shouldn’t spend one iota on unessentials until your debt is repaid — and while your vacation is a frugal one, you seem quite resigned to being in debt for a long time. Hmmm. Little Debt Fatigue rearing it’s ugly head? Have you calculated what it’d take to be out of debt in three years? Two years? One year?
Now I don’t disagree with Gail. I know the difference between a need and a want, but I don’t agree with the idea that a person in debt should not spend any money on any unessential things until they’re in the black. That approach may work for some people and I tip my hat off to them. Unfortunately, I don’t think it’s realistic for me to exclude occasional trips to the movie theatre or a round of drinks with friends. That just isn’t living to me and I know I would be very unhappy and overwhelmed. I think many people feel the same way.
Reader and fellow-blogger Nancy Zimmerman has an approach I agree with much more. She put it well when she left this comment:
What worked for me in the long term – and this goes against almost all financial planners – was to pay just a bit more than my minimum debt payments, and just resign myself to that as part of my life for the next several years, and at the same time, start saving up for things and start investing.
That accomplished a couple really, really important things for me:
1. My money started being FUN and INTERESTING and ENCOURAGING instead of always only about the black hole of debt
2. I discovered what it felt like to save up for something, and go on a trip, and come back without having increased my debt.Long term, the debt went away, and I still had the savings habit plus a portfolio.
Lots of people will say: don’t do anything but pay off your debt (often said with a judgmental tone!). That makes cold financial sense, true. But even more effective: doing.what.works. for you!
I couldn’t have said it better myself. Let me know, would you recommend Gail or Nancy’s approach to becoming debt free? Perhaps you have another way of attacking debt?
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September 15, 2008 at 6:11 pm
deepali
My take – do what you think is best for you, and take ownership. If you would rather take a year longer to pay off debt so you can still live a little now, then you should do that and be happy about it. As long as you decide to do *something*, you know?
That being said, I also think that people who make that trade-off should also not continue to complain about it. I think that might be what annoys Gail – hearing someone whine about being in debt or not being able to afford something or whatever, and then the next minute they are buying a clear “want”.
I’m not saying you do – this is just in general.
I guess in the end, what do you WANT the most?
I will say one thing about my own situation – I too was not willing to go bare-bones and sacrifice to pay off my debt too fast. I was happy with the progress I was making, even if it seemed slow at times. And then I got to see what happens when you have debt and something serious happens to derail everything. I also got to spend time with people who only dream of wants because they can barely fulfill needs. And I saw my debt dwindle a little bit by little bit and thought, how can I make that go faster? All of this converged and snowballed. But it doesn’t go like that for everyone.
September 16, 2008 at 12:36 pm
Evelyn Guzman
I love the name of your website. Why didn’t I think of that myself? All the comments I read have something good to offer. That’s what I think. I don’t think you should deny yourself living la vida loca. Postponing life is not the way to go. Who knows, we may be dead tomorrow. That said, we should still face our responsibility head on. Yes, pay your debt the tortoise way as you go merrily along in this life.
Evelyn Guzman
Debt Challenger
September 16, 2008 at 3:11 pm
Frugal Dreamer
In my opinion, i spent the last X amount of years “living” and “having fun” all the while, racking up my credit cards. I am not in debt because i was responsible. I got myself into this mess, and it’s up to me to get myself out. There is nothing wrong with going on vacation, buying new shoes or clothing – if it’s within your budget. There is a huge problem (again in my opinion) paying for a vacation on your (you being a generalization, not YOU personally) credit card, same goes with the shoes & clothing.
With that being said, personally – I prioritize. When i started the entire process of frugal living, i didn’t have an EF, savings account, retirement fund of any kind. All i had was debt. I am completely responsible for turning that around. Still, traveling is very important to me. I put aside a set amount each month to make the traveling possible. I don’t think it’s healthy to live under a rock, going without to a degree that you’re miserable and stressed out all the time. As long as you’re living within your means – then the habits that you’re creating will generally last.
September 16, 2008 at 8:46 pm
munchkin
i dont really agree that you should never spend money on anyhting fun until you are out of debt?? What if its going to take you 5 years to get out of debt? so youre never going to go out with friends or visit family a few hours away just because you dont HAVE to? im sorry but thats not living your life. You don’t need to force unhappiness upon yourself just because you are in debt. I mean lets face it, who doesnt have debt? I dont realy know too many people who pay cash for their car, AND their house and their education and everything else in their life. Most people work to pay off one debt only to get into it again for something else. It may make sense to some people to limit spending to the bare essentials because they are in debt, but that doesnt make sense to me, (im not saying its ok to splurge alot either, but spend in moderation), its just not realistic and its not living your life. sure you may be out of debt faster, but nobody is happy like that.
September 18, 2008 at 12:29 pm
andreachiu
Thanks for all your comments!
The general consensus seems to be moderation and doing what you’re comfortable with. For me, having control and knowledge of my personal finance is a pretty big victory. Right now, I am happy following an informed budget and not accumulating any new debt while every month I pay more than the minimum payment. I know I’ve got years of debt still and my approach will likely change, but for now, I’m OK with this.
September 19, 2008 at 12:00 pm
FruGal
I agree. It’s the same as dieting – if you suddenly started dieting and depriving yourself of everything except lettuce and carrots, you’d last about three days, then have a massive blow-out. It’s better to make some lifestyle changes that you will be able to live with long term. You’ve still got to live a little along the way.
September 19, 2008 at 12:07 pm
Money Funk
I do see both sides of these comments. And agree with them both.
Even though you are paying down debt, you do have to live a little. Yes, spend “mad money” in moderation. This approach might take a little longer, but you will live with sanity. We dug our own ditch of debt, now we are realizing our issue, and taking the steps to get out of it. But, climbing out of debt should not be treated as a punishment, but a realization to a better life.
It’s all a matter of personal choice. I do believe in not spending on things until I get my debt paid down to a certain goal, but I do have planned a $500 mini vacation for my family during spring break.