Lonchafinismo is a neologism that refers to that practice by which one saves in an unnecessary or extreme way. It can even cause damage to the standard of living.
In other words, lonchafinismo consists of saving above what is essential, cutting not only unnecessary expenses, but also those that cover certain needs.
The term lonchafinismo comes from a very particular case, that of that person who, to save money, cuts the sausage into very thin slices. This, when preparing a sandwich.
In principle, it does not seem a bad idea to save. But, if we stop at the example of the sandwich, two things can happen to the sandwich maker: Either he eats more later (because a sandwich with less sausage satisfies his need for food less) or he goes hungry.
That is, there are two possibilities. Or it’s no use cutting the ham finely, because he eats more later and he’s kidding himself. Or he decides to feel hungry, whereupon his well-being is being reduced. Here, the key is that food is a necessity, it is not an expense that, by reducing it, will not affect your quality of life.
We can understand lonchafinismo as a bad relationship with savings. It responds to a saver’s need to continue cutting expenses, even if this implies sacrificing well-being.
Some may compare it to an addiction. The slicer feels a satisfaction every time his savings increase. However, as we had previously mentioned, his standard of living might be falling.
Seen in another way, it is saving to save without taking into account how it is affecting the decrease in current consumption.
You will ask yourself then, wasn’t it good to save? Yes, but the question is what are you sacrificing.
Advantages and disadvantages
Lonchafinismo is a practice, in principle, questionable, for what we have been explaining throughout the article. However, we can highlight some points for and against:
Among the advantages we can mention
- Allows you to have a higher level of financial security: in case an emergency arises, there are more savings. However, let’s remember that, to set up an emergency fund, you don’t have to save in an extreme way (it is worth clarifying that we are not dealing with the case of a worker who earns the minimum).
- The habit of living with the essentials is acquired: And perhaps here we could open a very broad debate about whether we are facing a consumerist society. How many clothes do you really need? How many times a month do you need to go out to eat at a good restaurant? It is something that everyone must answer and on which we will not make a value judgment.
- Greater investment possibility: Saving more allows you to allocate those resources to an investment.
However, we will cite disadvantages, in addition to those already mentioned at the beginning of the article:
- Savings are limited: Cutting expenses is capped. There are payment obligations that cannot be avoided, such as rent. An alternative to increase disposable income is to generate more income, for example.
- You can lose: All the time spent looking for the lowest price could be spent, for example, working or generating income. This is particularly relevant if the saver is self-employed or an independent worker.
- It can generate problems with the social environment: Extreme savings could lead to conflicts or uncomfortable situations with our family and/or our partner. For example, when shopping at the market or having to decide where to go for a moment of leisure. Even more crucial decisions such as which school to enroll the children in could be involved.