Changing My Money Mindset: Frugal Vs. Freedom

A bit of a different kind of post this week. I’ve been reflecting a lot on life and realised that even though I’m great at saving, I have quite a negative relationship with money with regards to spending. I’ve been trying to look at why this is and figuring out ways I can work on removing those negative emotions.

1. My Relationship With Money
2. Frugal Vs. Freedom
3. Books and Podcasts
4. Side Incomes
5. Savings and Investing
6. Moving Forward

My Relationship With Money

Money has always been a very open topic of conversation in my family and I’ve been lucky to have been taught ‘money life skills’ from a pretty young age. Don’t get me wrong, as a child I wasted most of my pocket money on magazines and sweets, but I also got such a thrill from watching my coins roll down my Halifax savings bank into the right section.

Though I love helping my friends overhaul their finances, I am by no means a financial expert. It frustrates me that basic money management isn’t something that’s taught in schools. Over the years, my parents explained taxes, interest rates, mortgages etc. to me, but so many people never learn about the money fundamentals of life.

Growing up, we were pretty well off. We never went without, but I also wasn’t spoilt. Teenage Lisa struggled when my parents said no to buying me the designer clothes that all my friends seemed to have, but adult Lisa is very grateful to them for teaching me the value of money.

When I was at uni, I wasn’t great with my money. I never got into debt, or spent my overdraft, but I also didn’t save anywhere near as much as I could have. I got both a loan and grant, as well as working most evenings. Yet a big chunk of my money went on clothes and going out. Shopping was my downfall. I’d go between lectures out of boredom and buy so many things that I just didn’t need. As I got older and started earning more, my spending grew. I’d buy more clothes and also went through a phase of buying heaps of make-up that I never wore. At this point, both my ex and I were earning a decent amount, and we were able to save, overpay the mortgage and still ‘treat’ ourselves, so I didn’t think much of it.

However, after getting divorced and changing careers, I was all of a sudden supporting myself on less than half of what I’d previously been earning. This is when I really took hold of my financial situation. I started to budget and track every penny going in and out of my accounts. Saving gave me a thrill, and after getting a lump sum pay out from selling the house, I had enough behind me to not have to worry. The problem is, I couldn’t not worry.

Frugal Vs. Freedom

When the money from the house came through, I pushed myself way out of my comfort zone and decided to move to Cornwall. I spent a lot on a 3 month outdoor instructor course and accomodation, but with the intention of making back the money once I’d moved. From this point, I’ve been earning just over minimum wage, but with adjusting the way I live, I’ve still been able to save quite a bit. My issue now is trying to get the balance right between saving, but still allowing myself to spend to enjoy life.

I seem to have developed a lot of negative emotions when it comes to spending money. There’s the worry of will I still have enough if there’s an emergency, what if I decide I eventually do want to buy another house. How much is enough? I listened to an interesting podcast recently about wealth, and how people either look internally, or externally. External people focus on the amount of cash in the back, whereas internal see wealth as their relationships and experiences. I definitely feel like I’m in the process of shifting from external, to internal.

I’ve done several ‘no spend’ months over the past year or so, to try and see what the minimum is I need to live off. I’ve found these really useful in looking at what I spend money on that I don’t really need to, and it’s also helped with pushing myself to do more free activities and explore more local areas. I know I don’t buy or book things on a whim, so I shouldn’t beat myself up when I make a conscious decision to spend a little.

Books and Podcasts

I have read several books over the past few years that have really helped me see money differently.

Your Money or Your Life – Vicki Robin This book has practical steps to address your relationship with money with the ultimate goal of making a life, rather than just making a living. Even though I already do a lot of the suggested steps in the book, I’ve still learnt a lot from it and it’s helped to change my mindset around how strict I am with saving. It’s a difficult thing trying to get that balance right between saving for the future, and living now.

Early Retirement Extreme – Jacob Lund Fisker A practical guide to working out what’s worthwhile in life. This book helps you to examine your financial behavior and change your perspective on your relationship with money.

If anyone has any money related books they recommend, please do let me know.

Optimal Finance Daily: This is a side podcast to one of my all time favourites (Optimal Living Daily) and it has 5-10 minute daily episodes in which blog posts on personal finances are read. There’s a whole mix of stuff from savings and investments, to views on money, retirement, managing/reducing debt and even an interview with ‘the man without money’, who gave everything away and chose to live in the American wilderness.

Side Incomes

I’m a sucker for making extra cash in my spare time, and I have a few ways that usually bring in an extra couple of hundred a month.

Surveys: There are a lot of terrible survey sites out there, trust me, I’ve tried them. But there are a couple that actually pay really well and have regular surveys. My favourite is Prolific. I’ve been using it for a couple of years and have made over £1000 from it. The surveys are varied in length, but due to most of them being academic research studies, they pay really well compared to product surveys and are usually pretty interesting. It’s hit and miss as to when they’re taking on new people, but worth keeping an eye on.

Another site I use is Branded Surveys. The rates of pay aren’t as good for these surveys, and you do get screened out quite often. But, through their bonus scheme, the more you do, the more you earn so it is worth persevering with.

Pinecone Research is another great site. You get paid £3 per survey, and usually they only take around 10 minutes. As with Prolific, they close their books quite often, but you can usually find links on ‘side hustle’ websites when they’re looking for new participants.

All of the sites I’ve mentioned above cash out to paypal, which is super helpful.

Content Creation: I occasionally do paid promotions with brands via instagram. These have nicely worked out at about one per month recently, which has helped boost my income. I try to put this money straight into savings.

Affiliate Links: I make a very small amount through affiliate links via instagram and this blog, mostly through amazon associates.

Vinted: I am slowly reducing the amount of stuff that I own and try to sell whatever I can clothes wise on vinted. I find it really straightforward and easy to use. Anything I don’t sell, or feel wouldn’t be worth me selling, I take to a charity shop.

Savings and Investing

I’m pretty risk averse when it comes to money, so nearly all of my spare cash has been going into high interest savings accounts and premium bonds. I pay into several regular saver accounts each month, but most of these have a limit on what you can pay in. This has meant that I’ve been looking into alternative options and have just recently started investing a little using Invest Engine. I’ve always been anxious about investing, so I’m only putting in a small amount for now.

As I’m still not too sure what my plans are for the next few years, I can’t really tie my money up in long term savings accounts, I’m therefore missing out on some of the higher interest rates as I need to make sure I can access my money if needed.

Moving Forward

I am well aware that I need to do some work on myself around not having such negative thoughts associated to spending money. But I find it difficult trying to get that balance right. I made a conscious effort to step away from the corporate world and earning large amounts of money, as it just didn’t make me happy. I knew I wanted a life that would fit my ‘purpose’ more and allow me to get out adventuring as much as possible, see new places and not go home every evening worrying about meetings and spreadsheets.

I now spend much more intentionally. I think through every purchase and decide if it’s something I really need or if it’ll add something to my life. But I’ve definitely still got a long way to go before I’m content with my relationship with money.

Happy adventuring x

*This post contains affiliate links and I may make a small amount of commission if a purchase is made.