It’s Okay to Spend Money

This has been kicking around in the back of my head for quite awhile, so I thought I’d put my thoughts down on paper (so to speak)…

With all the hand-wringing that goes on about saving money, it’s easy to lose sight of the fact that it’s okay to spend money. And I’m not just talking about “needs” here… Believe it or not, it’s even okay to spend money on things that you want, but don’t really need. In fact, that’s the whole point of having your finances in order, isn’t it?

Don’t get me wrong, getting (or staying) out of debt and saving for the future are incredibly important, but don’t forget to enjoy your life along the way. Of course, you don’t want to overdo it and decimate your savings or run up a huge credit card bill, but you likewise shouldn’t overdo it in the other direction and wind up leading an overly ascetic life.

There. I said it. Now have a great week.

20 Responses to “It’s Okay to Spend Money”

  1. Anonymous

    Having been in debt for much of my adult life, I finally decided this was the year I’d “fix” it. I set the arbitrary target of New Years Day 2010 to be ‘debt free’.

    It’s been a struggle, but my latest estimate is I’ll be a month early, and there’s lots of overtime left to go yet. (OK, It’ll help pay the solicitor for my divorce .. so it’s still not ‘my’ money yet).

    But I’m terrible.. I allow myself £30 a month for things for me… which is my website that hosts my blog, and a home DVD subscription.. nothing else. I eat on the super cheap, don’t pay rent right now (thanks mum), and basically … don’t live.

    The sad part? My projection spreadsheets for ‘beyond debt free day’ do not allow me any more money for ‘me’ than my ‘get out of debt’ spreadsheet does. Compulsive? Yes.

    Healthy? I’m starting to think not.

  2. Anonymous

    I think that we need balance in our life. I read in the book Secrets of the millionaire mind that is good to reserve 10% of our income for whatever we want. This will bring balance and take away the guilt of becoming stingy. At least it is working for me.

  3. Anonymous

    It’s totally normal to have this hoarding/obsessing reaction. It can be detrimental however, especially when it comes to checking PF blogs and bank accounts during the workday, at the detriment to your productivity.

    I went through this too, but I think the reason I broke out of it is I found outlets to spend my money on that were fulfilling, like classes and clubs. I think the initial post’s recommendation is the perfect prescription: budget something for fun money and do it. I heartily recommend artistic classes, or involvement in church. I got into improv, but you could do pottery or painting or music lessons. You could bump up (or begin) a contribution to your church financially, and by getting involved in its work; joining the trustees or some other committee. They’re all a good chunk of money, but they get you out of the house and into society. They broaden your horizons, and expand your investment in life. You do NOT want to become a miser, it’s a lonely and depressing life. Force yourself into something and you’ll find the happiness you’ve been seeking. Money just isn’t it; it’s only a tool to achieve happiness. Money is for opening doors; people who lock it away have completely the wrong idea.

    Anyway, good luck, and kudos for asking the question. I think we all go through this. Once we have something, we’re terrified of losing it. But you aren’t master of it until you decide how you’ll spend it.


  4. Anonymous

    if you were a compulsive spender, then you will be a compulsive saver. it’s nothing new, you have just changed what you are compulsive over. the key is to identify your compulsive tendencies (this doesn’t make you a crazy person), and to moderate your behavior. harder said then done, but it is very important. the danger in being a compulsive saver is the chance that you will invariably take more risks and be more compulsive in investment choices (you are spending again) ignoring basic fundamentals. as Pam stated, she has a tendency to hoard money without clear goals. the basic fundamental she is ignoring is have clear goals for her money.

    Minimum Wage, there are lots of things you can control and things that you cannot control. yes, there are creditors and landlords out there who you owe. this doesn’t mean that you can’t change things like getting a second job, going back to or going to school, or getting a different job. the key is to focus on things that you can control and stop worrying about things that you cannot. if you feel that you are in a bad financial place, then do something to change it rather than wallowing and feeling that you are slave to everything and everyone else out there. I’ve been in your shoes, but have gotten out.

    it is okay to spend money. in fact money is an instrument for spending. i’m not sure where in the savings blog world that people seem to forget this. enjoy your money and spend it on things that you want and need. as before, have a goal for your money. that is the reason for all this saving stuff.

  5. Anonymous

    Great timing! I have a windfall coming in, and I’m thinking about blowing some of it. I’ll have to give 10% to taxes, and the things I want to blow it on might spend up to 50% of the remainder — and I feel soooo guilty about it.

    Note that my whirlwind spending spree involves mainly several items of furniture that will probably last me 30 years, and two semi-pricey items for a hobby (and if I tire of the hobby, these items have nearly 100% resale value). So it’s not *that* frivolous.

    But even if it were completely frivolous, my husband keeps telling me, “It’s your money, you can do what you want.” Maybe he’s right.

  6. Anonymous

    It’s not okay for ME to spend money because I earn minimum wage and I have a landlord and creditors who can and will make my crummy life even worse than it already is if I spend money and don’t give them what they want.

  7. Anonymous

    Oh my goodness… I was just thinking about this the other day, that I’ve gotten to be obsessive about the whole saving thing and am totally unwilling to budget money for fun… then I spend it anyway, get guilty about it, and tighten the purse strings even more. Vicious cycle, it is…

  8. Anonymous

    That’s to funny – I’m having the EXACT same problem as the previous poster. I recently got out of credit card debt and I’m obsessed with checking my bank accounts and calculating all my savings for monthly, yearly and for retirement.

    Is it normal? I’m literally obsessed with checking my money and constantly reading websites just like this one about “personal finance” and investing.

    Seriously, is there anyone else out there that’s had this happen when you got out of debt? I was so oppressed for so long that I’m going into a hyper mode about savings and “hoarding” money!!!!!

  9. Anonymous

    There’s a reason that alot of rich people are stingy, and it’s not just because at the Millionair Next Door would like us to believe that’s what it takes to be rich. I believe there are two fundamental forces at work. 1) Loss Aversion – If you don’t have much you don’t worry about losing it. 2) Tendency for many people to hoard

    I’ve personally been guilty of both things. I think having a plan is more important than being frugal in itself. Sometimes, it’s ok “to smoke em, if you got them.”

  10. Anonymous

    I am a 30 yr old guy and have been in debt all my adulthood, till a few months back. I got a decent job now and am earning OK type.
    The problem is that I am not able to spend money now. When I was in debt (student), I never used to think about money and piled on the debt in the hope that I will clear it off.
    Now since its cleared, I have become stingy. I want to hoard. I have no clear goals to invest the money but feel good seeing it in the bank.
    Its crazy but I do check my bank balance 5-6 times a day online just to feel good. I calculate the amount I would save per six months, 3-4 times a day.
    Am I nuts? whats happening to me? is it normal to behave this stingy way, once u have money?

  11. Anonymous

    Agreed. I’ll go one better: it’s even ok to spend some money on some fun things without budgeting in advance. The important thing is to make sure that everything is done in moderation and that you are saving enough for a rainy day.

  12. Anonymous

    Every budget needs a Fun/Blow/Burn category! I used to leave it out when I was super focused on debt but money got spent anyway with major guilt! When it’s in the plan, spending can actually be fun!

  13. Anonymous

    Spending money is okay? Just kidding, of course we need to enjoy our life and quality of life is important. Sometimes it feels like a competition to see how much can be saved. We all need a prize sometimes.

  14. Anonymous

    Dividend Guy, but the problem is you may not have “the rest of your life” – you could die any day and leave piles of money behind. Or you could live to be 100. You just don’t know. I like the idea of budgeting for fun and enjoyment as you go along…

  15. Anonymous

    I work in a downtown location and when I look around it seems like not many people are having trouble spending money – I guess it is just those of us trying to not have to work for the rest of our lives that are holding back!

    The Dividend Guy

  16. Anonymous

    This is something that I have a problem with sometimes. I will often trim my budget down to almost nothing in the “fun” categories. It can make it difficult at times because I feel like I am denying myself things that I could be doing just because I feel guilty about my debt.

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