3 Reasons Why I Don’t Believe the “Live For Less Than You Make” Advice

• I’m often told to “live for less than you earn” if you want to be rich, but I don’t buy it.
• I always stick to a budget and am careful with my money, but this tip doesn’t always make sense.
• When I was building my business, I needed to invest money I didn’t have yet to get things done on the ground.

I’ve spent the past few years working overtime to fix my finances after making many mistakes in my twenties, from not saving for retirement to poor spending habits. It has almost become an obsession for me to search for tactics, tips, and strategies that can help me develop

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And simplify how I manage my money on a monthly basis.

As I consume financial advice and get help from financial experts, there is one piece of advice I hear often: Always live for less than what you earn, which means you should spend less than the amount of money you make each month from your job.

While I’m a big advocate of sticking to a budget, not taking on unnecessary debt, and controlling your money so you can see the impact of your financial decisions on your overall financial portfolio, there are some reasons why I shouldn’t. Like the advice you should always live with less than you give.

1. There are times when it is important to invest in yourself

When I was laid off from my full-time job in 2015, I learned a financial lesson that I was too stubborn to understand before: Sometimes you have to invest in yourself so you can make more money.

After layoff I decided to start the business myself, but there was a period when I didn’t get any income. However, I knew I had to invest a few thousand dollars in courses, freelance help, and digital tools to be able to set out to become a solo entrepreneur. I pulled out of my savings account and put some charges on a 0% interest credit card.

This spending was calculated and considered, and although it came with risks (there was no guarantee that this route would work or be a profitable solo entrepreneur), I knew I wanted to give it a try and took all necessary measures to be strategic about it. My decisions (researching competitors, testing the audience, writing a business plan).

If I had stuck with the mantra of living below my means, I would have put off investing in these tools until I wind up with a part-time or full-time monetization job to make it happen.

Instead, I spent more than I could afford and took advantage of those costs to help me start a business that was profitable in three months and helped me pay off my credit card and replenish my savings.

2. It limits people not to pursue other sources of income

There were times in my life when I wanted to upgrade my lifestyle, like when I no longer wanted a roommate or when I wanted to take a vacation or two a year.

If I just told myself I couldn’t stand these things because I wasn’t earning enough, I would be stuck in a limited mindset that doesn’t allow my money and goals to see any growth.

Instead, wanting to live above my means has made me more passionate about exploring passive income streams, new business opportunities, and finding ways to increase growth within my current side struggles.

As someone who is careful about how they spend their money, when I want to upgrade my lifestyle I make sure I have the money first. But instead of finding ways to cut back on other spending to afford vacation or the cost of renting a one-bedroom apartment on my current salary, I’m thinking of ways to make more money.

3. It’s advice that doesn’t apply to every moment of your life

I’m a huge proponent of sticking to a budget, but there are still one-off situations where I decide to splurge and live above my means temporarily. This might include incurring the costs of the wedding, paying for an occasional trip, investing in myself, or upgrading an item that is a big part of my life (computer, bed, etc.).

However, before incurring these costs that I may not be able to afford in cash, I make a plan for how to pay for these items without incurring huge debts. That could mean doing extra side work, opening a credit card with 0% APR, or withdrawing from my savings. I always make a plan to cover overspending.

I realize that my view on this advice is unusual, but I know that with the help of professionals and my own risk analysis, following this path has only helped me expand my lifestyle and work.