The year was 2014.

I had just started working as one of the first employees of a bootstrapped, early stage startup.

This was the stage where everything mattered. Every customer mattered. Every business partner mattered. Every expenditure mattered. If you’ve ever been on the ground-floor of an early stage company, you know how nerve-wracking this time can be.

The role I was working in required me to travel pretty often. I would put together business trips from our local Charleston, SC to cities like Austin, TX, Phoenix, AZ, and Pittsburgh, PA. When I’d go, I’d often opt for Airbnb over hotels because it was cheaper.

(During my first trip, one to Austin, I stayed in an old Airstream trailer for $29/night, which I chose because it was close to a lot of the offices I would have to visit, so I could save money on Ubers and rental cars.)

This wasn’t even my own personal money I was saving — it was company money that was being used to recruit new business partners. In my own personal life, I went as far as renting out my own apartment on Airbnb while traveling so that I could help cover the exorbitant rent in the Charleston area.

One night, I came home early from a business trip and my guests were still at the apartment. They weren’t due to leave until the next day.

Instead of getting a hotel room, I opted to go to a local Waffle House and write for a few hours and chat up the cook. Eventually, I passed out in my car with a few hours until morning.

When he heard this story, one of my colleagues sat me down to explain to me that it was okay to spend money. I didn’t need to scrounge to save every dollar I could. And, if it improved my quality of life, spending money was probably the right thing to do.

This hit me like a freight train.

I had bristled at accusations of cheapness from friends before.

“No, I am not cheap. I am frugal. I don’t spend money needlessly. I’m happy to spend money on others, or even myself, when the situation calls for it!”

The problem was, my definition of “when the situation calls for it” was so strict that if it didn’t fall into the category of groceries (only the basics, of course), rent, utilities, the gym, or my car, it didn’t qualify.

This bled into every part of my life. At my job, I would scrounge to save money for the company (and expend so much energy doing so that it would have been better to just get a decent hotel room so I could focus on doing work well), would limit the dates I went on, would never purchase courses to learn new skills (“why purchase courses when books are cheap and so much is free online?” <- not a good mindset to have), and generally elsewhere.

I could go on about how this is all a symptom of my past — I grew up with a family that was well-off and lost it all in a downturn and a divorce, grew up in rural coal country, and went to college surrounded by New York elites — but that doesn’t provide a solution.

Operating as a cheapskate led me to thinking like a cheapskate.

Sure, my savings grew disproportionate to my earnings, but my earning potential grew slower relative to my skillset and potential. I operated from what the self-help gurus call a “scarcity mindset.”

Extirpating this mindset from my mind was one of the most liberating steps I made in the last five years.

My Favorite Reframes to Overcome Stinginess

These are the mental tools I used to do it.

Thinking on the Margin

If there’s any class I would recommend to a college student, it is Intro to Microeconomics. Thinking like an economist, understanding incentives, looking for the unseen (the second- and third-order consequences of decisions) has been hugely helpful for my career.

Thinking on the margin has, as well.

Thinking on the margin means thinking in terms of the next action, decision, or unit of time or money you can spend.

This is useful for increasing your earning potential, by asking yourself, “how much more can I earn if I work that extra hour to close that additional client?”

It’s also useful for thinking about what each purchase means to you. “What else could I purchase with this money?”

You can use this question to curb useless spending or you can use it to sell yourself on powerful spending. By powerful spending, I mean purchasing items that will help you increase your marginal productivity or quality of life.

Using this tool sparingly (because using it too much can lead to convincing yourself everything is a small purchase…and that adds up) can be a great way to get yourself moving when asking yourself, “should I purchase X?”

Here’s an example from my own life:

Even since overcoming my own scarcity mindset, I still like to track my spending and keep a budget so that I can spend more liberally on surprise opportunities, like concerts or new courses or material I could buy.

The other day, a new course launched from Ramit Sethi, one of my favorite educators online. I had recently purchased another one of his products, but told myself I would hold off for a while.

The monthly cost of the program was literally less than a purchase I had just made on Amazon without a second thought, and the Amazon purchase was merely a tool. Sethi’s programs had helped me leverage knowledge I already had to make 10x on what I spent on them, in only a few months.

I reframed the purchase from, “ugh, something else to spend money on,” to “yes! Something else that is even more valuable than that item I just purchased on Amazon, and for less!”

The margin in question here is less the extra unit of time it would take to afford this item (although that answer was also helpful — 15 minutes or less), but more, “what did I not think twice on purchasing of a similar price that brings me less expected value?”

Thinking in Terms of Investment

Any time I was confronted with an opportunity to spend a little bit more money on something nicer or more enjoyable, my instant reaction was, “save now, enjoy nicer things later.” This is an easy mindset to fall into. Uncontrolled debt can be a nightmare and failure to invest is a leading cause of late-life anxiety.

This is one of the leading catchups for effective and future-oriented people and one of the major reasons they choose to be cheap when they can afford to spend a little more.

There’s a difference between saving to invest and saving out of fear. Not all investments are monetary, too.

Will sleeping in a hotel room that doesn’t smell like smoke help you focus the next day on important work, even if it is $45 more?

Will renting a car bring you peace of mind that relying on Uber or taxis won’t, even if it is $20 more?

The classic example for me with this is business class on transcontinental flights.

If you’re flying from Boston to San Francisco and sitting in coach, will you still be productive when you land? Even if you are going into intense meetings?

How about the other way around? If you are flying from San Francisco to Boston in coach on a red eye flight, and you are counting on falling asleep but you just can’t, will you be a zombie when you land the next day? Will you need to take the day off?

Think of that $500 upgrade as the cost of having a valuable and productive day the next day. $500 might be nothing compared to the important meeting you have with a potential investor or the sales calls you have or the product pitch you have to do to your team.

“What might I get from the perks of buying this product/service?”

This has been hugely powerful for me when it comes to books (I buy any book I find interesting — I don’t care about the price so long as it isn’t absurd), seminars/courses with real, tangible benefits, coffee or lunch with interesting people, or travel to go see interesting people.

This has paid dividends for me. The 12% ROI I would have gotten from my IRA would be less than what has been earned as a consequence of selectively spending more.

Memento Mori — What Will You Remember?

Honestly, remember that you will die.

Life is not about accruing the largest retirement account.

(But, for the love of God, please do make sure you actually have a retirement account. I use Wealthfront to automate my investments, which you can get here.)

You’ve probably heard that you should spend money on experiences, not things. You’ll remember the experiences and the things will eventually wear away.

Once you have your basic investments covered (whatever this means for you), remember that life is about enjoying what you earn.

I have my investments covered this month. I covered my expenses. I closed a few deals.

I want to go to a performance of Symphonie Fantastique by the Pittsburgh Symphony. Do I distress over the price of the tickets?

No! I think about how much I will remember seeing the performance and recall how I can still remember first seeing it performed by my local community symphony years ago.

Easy decision — drop the money for the experience.

Remember that you will die.

There’s also just nothing wrong with wanting to enjoy decent stuff. Driving a decent car feels better than driving an economy car. Wearing nice shoes feels better than wearing crappy plastic shoes. A good bottle of wine is world’s apart from a cheap bottle of wine.

Don’t spend your money stupidly, but also don’t save it stupidly too. Cover your costs, investments, minimize your debt, and then spend money on experiences (and yes, sometimes items) that improve your life.