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Creating Freedom Through Financial Independence


Why Our Idea of Sacrifice Is Wrong

September 26, 2022

Sometimes I write about things that excite me.

Other times I write about things which annoy me.

Today, it’s the latter 😉

And what’s bugging me is something that has lurked in the background in the personal finance space for a long time: the idea that to save, build wealth, and become financially independent requires a good dose of sacrifice.

I use to believe this was the case.  I’ve probably even said it on this blog.

But it’s not the idea of sacrifice that bothers me.  It’s the way most people think about the concept.  I’ve come to believe that the way we frame sacrifice is wrong for multiple reasons.


What is sacrifice?

When you think of the word sacrifice, what comes to mind?

For most people, I think it’s the idea that you’re giving up something.

To forgo or to deprive yourself of a certain thing, possibly for a greater cause or goal.  But the core idea (and the main focus) is to forgo or give up something.

So, what’s wrong with this framework?

First, sacrifice tends to have a negative connotation.  We generally equate sacrifice with hardship at the center.  It often brings up feelings of “Oh no, I’ll miss out on X.”  Or “I won’t get to do Y anymore.”

This is a common key objection to the FIRE movement and the idea of spending less so you can invest.  It’s the biggest hurdle in starting a new diet or exercise regime.  Countless things are like this.


Redefining sacrifice

If I can be bold for a minute, let’s redefine and reframe how we think about sacrifice.

Through our current mental framework, the focus is seemingly always on what we’re giving up.  On what we’re losing.  The negative side of the ledger.  But this is only half the story. 

What are we gaining in return?

This is a crucial puzzle piece which is missing from these mental equations.  Because if what we’re gaining is incredible, then we might not care about the thing that we’re losing.  And if that’s the case, then it’s a happy trade-off, and the idea of sacrifice is flipped on its head.

And if the benefit isn’t worth the sacrifice, then it’s simply a trade we aren’t interested in.

See, sacrifice is not about giving up.  It’s about trading one thing for another.  Not only is the idea of hardship and the sense of loss unhelpful, it’s not even accurate.

Sacrifice, in reality, means choosing something different, something more important to us than our initial behavior.  Plus, you’re already sacrificing and don’t even realise it.

Say you currently eat a shitty diet and you want to be healthy.  Are you really sacrificing donuts and chips in order to eat cleaner food?  Or were you already sacrificing your health for donuts and chips?

If you’re currently in terrible shape, are you sacrificing couch-time to go for a walk?  Or were you already sacrificing your physical fitness to sit idle?

Sacrifice goes in both directions.


Examples of sacrifice

With our more complete idea of sacrifice front of mind, let’s flesh out some other examples.  We sacrifice:

—  The single life for a relationship.

—  Millions of additional dollars to retire decades earlier.

—  Being decent at lots of things to be great at one thing.

—  The stability of cash to invest in shares.

—  The flexibility of renting for the security of owning.

—  Netflix binges to spend time learning.

—  Another decade of freedom for ‘a bit more’ wealth or a fancier lifestyle.

  All the things we could do for the things we are doing (I’m sacrificing time with my dog to write this article).

Of course, we don’t think of these things as sacrifice.  Intuitively, we understand that we’re simply dealing with a game of trade-offs, swapping one thing for another.

Every choice has an alternative.  We can flip these around and frame it the same way.  We’re always sacrificing one thing for another.  Our entire life is one big game of trade-offs.


Why people suck at saving

People don’t suck at saving because they’re bad at depriving themselves of things.  They suck at saving because they think that to save they must deprive themselves of things.

Saving becomes a painful experience.  Something to endure.  Again, the focus is on what they’re giving up.  Never what they’re getting in return.  Which, in the case of saving, means a cushion to fall back on, lower stress levels, the freedom to work less, and a greater sense of peace and security.

The fear-of-missing-out becomes like a bug under our skin… tormenting us for all the things we’re missing out on.  But we fail to recognise that saving – like health, and skills, and studying – is just another game of trade-offs.

And because it’s all a game, like life itself, there’s no reason for us to feel pain about our decisions.  You simply have to decide.  Something is worth it or it’s not.  We make a choice, roll with it for a while, and if we’re not happy we can adjust course as we go.

Which brings us back to sacrifice and saving.   How can we make this as easy as possible?


How to make sacrifice easy

Step 1:  Make it enjoyable!

Step 2:  Don’t forget Step 1.

Look, we are playing a game, but it’s not an all-or-nothing game.  The common assumption, and I’m sure you’ve come across it many times too, is that to save a lot of money requires a high level of sacrifice and missing out.

Not true.

To the masses who have different priorities, that’s definitely what it would feel like.  But when you have a different set of priorities – like freedom, personal wealth and a more relaxed lifestyle, it doesn’t feel like that at all.

The nonsense of having a brand kitted-out Hilux becomes less important than having complete control of your time.   And once you optimise the big stuffhousing, transport, travel, food – the rest is pretty flexible.

The truth is, most of us earn very healthy incomes in Australia.  Enough that we can blow a fair amount of cash, while still being able to sock away a good chunk of change each year to our mortgage or brokerage account.

This means you can still have areas you spend on.  The goal isn’t to make our spending as low as possible.  The goal is to make our spending as reasonable as possible, so we can hit our financial goals while living an enjoyable lifestyle along the way.  If the FI journey is making you miserable, you’re doing it wrong!

Even allocating an extra $5,000 to $10,000 per year won’t make that much difference.  In ten years you might have missed out on an extra $100,000 of wealth.  But at that point, your wealth is probably growing by that much through savings and investment returns!

So, you may delay financial independence by a year or so.  That’s nothing in the grand scheme of things.  And if this extra spending would make a big difference to your life now, then it’s probably worth it.

But instead, people create these fake hurdles in their mind: “Oh, the FIRE movement is all about sacrifice and missing out on things so you don’t have to work later – I can’t do that.”

It’s utter nonsense.  A made-up barrier.  And people do this because the status quo and dismissing ideas is vastly easier than change.  But as long as most of your spending is moderate, you can still have an outlet for whatever costly habit happens to be important to you.

And I’m probably being far too generous, because most people’s personal finances are, as Mr Money Mustache once described it, “an exploding volcano of wastefulness.”


Final thoughts

I hope I’ve shed new light on the discussion around sacrifice.  The idea that this is all about missing out on valuable things for some future benefit is ridiculous.

The irony is, things always seem harder in our minds than in reality.  The one thing I hear repeatedly from more advanced readers is they wish they started sooner.  So if you’re on the fence about whether financial independence is worth the effort, there’s your answer.

If something is important to you, you’ll make room for it in your life and your finances – simple as that.  Speaking of which, what trade-offs and choices are you currently making that look like sacrifices… but are really just swapping one thing for another?

Are you eating more veggies and less ice cream?  Camping instead of hotel-hopping?  Being more attentive with your kids instead of playing on your phone?  Investing money rather than spending it?  Making your own food instead of takeaway?  Spending more time outside instead of on the couch?

The bottom line is, everything we do comes with a hidden list of benefits and drawbacks.  When we ‘sacrifice’ something, we’re simply choosing a new, more desirable set of benefits and drawbacks.

And if that’s the case, then it’s not really a sacrifice at all.

By the way, I wrote an ebook with my favourite strategies that helped us save up to 70% of our incomes while still living a good life.  It’s called Supercharge Your Savings Rate, and you can get it here.


12 Replies to “Why Our Idea of Sacrifice Is Wrong”

  1. Thanks again Dave, it’s all in the mindset. Balance is the key IMO. I agree with you on how this subject annoys you, it does me too. Thank you for articulating this topic and I cant wait to read your book!

  2. Great post and I agree totally with your views. I grew up where sacrifice was a label used for the ANZACS and other diggers, but with the generations, it has come to mean different things depending on your situation, attitude and even your personality! Sadly, I think the negative connotations the word “sacrifice” gets is largely down to the “entitlement” mentality that is common these days. Not sure how it can be preached to the masses, but those young adults, and even older ones who see FIRE as a goal, will also hopefully see it the way you do. I can thank hard working, immigrant parents for my views on obtaining FIRE status and I’m better off for it!!

    1. Good points Rita, thanks for your comment. I think you’re right. We’ve definitely moved the goalposts for what qualifies as ‘sacrifice’ these days.

      If anything, people seem to become softer, more coddled, and less willing to hear hard truths with each passing year. So I don’t expect this to change any time soon. But then again, I’m not necessarily trying to help those people, as much as I am trying to reach those who are open minded and willing to create a different future.

  3. I hear this a lot but from a health perspective. Managing an autoimmune disease with a low fat whole foods plant based diet. Many many people tell me they could not do it. But it’s not a negative/FOMO/sacrifice. It’s a gift! So is the ability to live in Australia and reach a version of financial independence. It’s a choice. Love your articles Dave.

    1. Thanks for sharing Jenny, and well said. It’s a strange thing isn’t it? People think they’re ‘treating’ themselves with garbage food and a self-destructive set of finances… when really it’s just a way of giving in to our short-term impulses and framing it as a reward. Their body doesn’t think it’s a reward, neither does their bank account or future-self 😉

  4. I frame it slightly differently as being about tradeoffs. If you want this you can’t have that. And once you start thinking about things being a tradeoff it hopefully gets you to prioritise the things that are important to you, and minimise the things that aren’t. Sometimes that’s a financial tradeoff, sometimes it’s time, sometimes it’s other stuff as well. But you want to be spending most of your time and your money on the things that are important. Happily sometimes there isn’t much of an expenditure of money, but when you do need to spend it’s great to know that you can do so without having to worry about it much.

    1. Nicely put mate, we’re in agreement there for sure! 🙂

      Once we figure out our priorities, things become a whole lot easier. Requires some sitting down, thinking, and occasionally a tough choice or two.

  5. I love this article! It’s so true. As humans, our psychology says that losing a thing is more impactful than gaining it. (This is one of the reasons gambling is addicting. Since losing is pain, we need to gain more to balance it.)

    However, if we focus on the gain instead of the lose, and pay less attention to the lost, the process is more enjoyable in the end.

    So sacrificing is in fact gaining. FIRE is about gaining a new life! I really like this thought.

    1. Yep exactly! We apparently feel the pain of loss more acutely than the joy of gain. But changing our perspective and focus makes a massive difference.

  6. Dave,

    Spot on mate…
    “Sacrifice, in reality, means choosing something different, something more important to us than our initial behavior.”

    Reminds me of the quote, you can have anything you want, you just can’t have everything you want.

    It’s critical for us to value the plus of what we get, together with the minus of we won’t get, then we know it’s a decision we’ll be happy with… As opposed to a sacrifice!


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