We’ve all seen the how-to-be-rich articles that advocate trimming your luxury expenses in order to solve your money woes. It makes sense at some level: if you’re struggling for money, forget the weekly pedicures, avoid lavish vacations, and cancel that streaming service you never use. If you’re making a big purchase, buy a cheaper car or appliance, and pay cash as much as possible. And you can always toss in a side hustle or two (or three) to make extra dough.
As I’ve written before, these tips really only work for people who already have decent income and/or no debt, who are looking to boost their savings, or who simply want to have more money for a nice vacation. For those people, it’s easy to get extra dough by sacrificing completely unnecessary expenses, but their lifestyle really doesn’t change.
My Good Financial Decisions Couldn’t Save Me
According to a 2019 Bankrate.com survey, only 40 percent of Americans have enough in their savings accounts to cover a…
For people who are job-insecure or underemployed, who accumulated debt due to medical expenses or periods without income, or who are hit with unexpected large expenses that drain their savings, cutting out a $12 streaming service isn’t enough to lift them out of trouble. Only a major increase in income (or decrease in major expenses) can really help. And in a recovering economy where the majority of new jobs are temporary gigs, this can be unattainable.
As an excellent recent article in The Atlantic notes, it’s convenient for (older) personal finance gurus to point to (younger) Americans’ habitual spending as a symptom of irresponsible financial behavior. After all, those lattes and avocado toasts add up! If millennials would just stop buying them and putting that money toward better things, they wouldn’t be poor. Right?
Wrong. As others have observed, pretending that avoiding small purchases can undo the tide of student loan burdens, underwater mortgages, underemployment, layoffs, or simple bad luck is simply foolish. In addition, there is a big difference between improving cash flow and actually breaking out of a paycheck-to-paycheck reality.
Imagine that you buy a $5 latte every weekday. That’s $1,300 over the course of a year. Sounds like a lot, right?
Where is the money when you need it for a major hospital bill or car repair? You’ll have that amount at the end of the year if you skip the latte and put it in a piggy bank — a little more if you use a high-yield savings account.
That’s the thing. Saving is easy to get start, and skipping an unnecessary expense can help with that. But covering big, unexpected expenses is not easy unless you already have a large amount of savings. And those whose income is primarily taken up by debt payments — especially student loans that can reach $600–1000 per month — are struggling to save. Given this fact, spending $100 per month on coffee doesn’t really matter when you have $1000 in expenses you can’t afford.
Don’t get me wrong: it’s good to be frugal, and it’s good to question your spending habits and find places you can cut corners. Being $100 closer to the amount you need is a good thing. But this best practice is not a panacea for financial woes that arise from systemic issues. Ideally, you would be able to simply obtain the job that paid you enough to allow you to get out of the hole. When we have jobs paying only $13–20 per hour for people with master’s degrees, we have a problem.
What I Learned from Microinvesting
In early 2018, I fell in love. Every morning, the first thing I’d do was to check my phone. I spent a large part of the…
I’ve lived this. I made all the good financial decisions I was supposed to make, but I’m still not in great financial health. I’ve been dipping into savings because my fiancé had a plunge in income and I had to pick up the slack. I’m still paying on my hospital bill from last year, which was huge even with insurance. In addition, I paid a lot in car repairs before finally selling the problem car for only $1200 cash, but I had to take on a hefty car payment when I replaced the car, even though I bought used. So, I have little cash flow and I’ve had to dip into my savings for, yes, emergencies and medical bills. Which is what it’s for, but guess what, it doesn’t instantly replenish itself!
It felt like years of constant misfortune that kept costing me all my money, and I couldn’t seem to find a job that paid enough for me to accumulate gobs of savings, even though I have three degrees and ten years of experience in my field.
Then, my beloved cat of 10 years fell ill.
Within a few days, I’d paid nearly $700 in medical treatment for him, and was looking at $1000 more. Even after cashing out all my savings, I didn’t have the money. My fiancé and I decided to try out a GoFundMe.
Although the campaign went well and we received an incredible outpouring of support from friends and their friends, we’d also opened our lives to scrutiny. We received comments on our campaign updates referencing our recent check-ins to — you guessed it — coffee shops. Apparently, we were not allowed to ask for help if we’d spent $5 on a coffee — several days before the emergency situation arose, nonetheless. We were expected to see into the future and deprive ourselves of any luxury in case someone got sick.
To these people, it didn’t matter that we had had savings that had been drained by the vet bills. It didn’t matter that we were sending every bit of our money to the costs of treatment. All that mattered to the coffee-shamers was that they could feel superior to people in trouble by criticizing them for their choices. In their eyes, we didn’t deserve any luxury unless we had thousands in savings.
We received a private message complaining that they saw on my recent posts that we “ate out at fancy places that we couldn’t afford.” The fancy place in question? A taqueria where I’d paid $9 for two tacos after a long week, and I’d made a little extra freelance money. I hadn’t eaten out for a month prior to that, and that was when I went out for my birthday.
We received another message asserting that if we just skipped the lattes, we’d have enough money for the cat’s treatment. I brew coffee at home every morning, but I’d bought one at a shop when I was running late one morning and posted it on Instagram because the shop was cute. I got a plain black coffee for $3. I’m not sure in what world skipping that would have allowed me to cough up $1700.
And of course, we received a message saying that we should just save money and put the cat down. I responded to that by asking if that was that person’s normal approach to treatable illness in a family member.
In short, I was blown away by the baseless accusations and unbelievably entitled attitudes in these messages, all designed to blame us for our troubles and gaslight us into thinking that we were big spenders. We were expected to believe that avoiding our occasional — not even regular — small purchases could have solved big problems.
The harassment worked. I felt guilty for those tacos. I wished I hadn’t spent the $9 on it, even though I had no way of knowing I’d need that money just a few days later. But I shouldn’t have felt guilty, because $9 doesn’t get me very close to $1700. Whichever choice I had made when we passed the taqueria, I wouldn’t be in a better situation.
When we talk about cutting unnecessary spending, we’re not talking about shaming someone into feeling like their lack of prescience could cause the death of a family member. We’re talking about empowering people to save for their future. We’re talking about having compassion for those who are struggling and providing them with tools to cultivate good habits that actually work, like microinvesting, setting up a retirement fund, or side hustling.
As well, we should ask hard questions about our current economy, which favors short-term, contract-based work over long-term employment. We should look at our labor laws’ loopholes that allow employers to skip providing health insurance and pay lower wages. We should look at our government’s activities that drive up consumer costs while improving only the wealthy’s cash flow.
Most importantly, we should chill out about the lattes. They’re certainly not to blame.
Rachel Wayne is a writer and artist based in Orlando, FL. She earned her master’s in visual anthropology from the University of Florida and runs the production company DreamQuilt. She is an avid aerial dancer and performance artist, and also dabbles in mixed-media. She writes nonfiction stories about herself and other awesome people, as well as essays on feminism, societal violence, mental health, politics, entrepreneurship, and whatever cultural topic strikes her fancy.