True contentment comes from knowing what you really want out of life and working toward it. I found a middle ground on frugality that has us spending around 40k/yr and everyone is happy. Higher than it has been in the past, and still a little high for my tastes, but a little low for my wife, and the kids aren't spoiled but not deprived...
I also like not having to worry about what the stock market is doing (staying flat would be better than dropping precipitously, but whatever), so I have found a job that I enjoy and have thrown myself into appreciating it for the next few years. I'm FI, which has helped reduce stress.
I also found, later in life, that I don't want to be a stay at home parent and was lucky that my wife took on that role when the kids were younger. Now that the kids don't need her as much, she has gone back to work as a teacher. With her income, she pays for extra things for herself and camp for the kids in the summer so she can have more freedom. We worked hard before kids, and continued to live below our means even when we went to one income, primarily by driving used cars and living in an affordable home while our friends lived the dream.
One realization is that it would be harder, if we were starting right now, to have as high a saving rate as we had in the past because we want to be in a good school district (which compounds the expenses - housing, property tax, insurance, utilities, etc.). Also, teenage kids are more expensive than young children - food, activities, academics, clothing... so make sure you figure out your priorities sooner rather than later! But, all along the way, make improvements and keep a healthy balance. Maybe you want a higher saving rate, or maybe you really DO want to live more luxuriously now, but are aware of the trade-off with less financial security and options in the future (since you're on this forum, where people are retiring in their 20's and 30's because that was what they really wanted out of life).
Good luck, whatever you decide!