3 ways to splurge wisely
The key to responsible money management seems simple – spend less than you earn. However, constant scrimping and saving can be a source of burnout and frustration. Enjoying the finer things in life – such as the occasional dinner out or a holiday trip – does not have to mean putting your budget in the red. Here are the three principles you should consider when you want to splurge.
1. Spend on what matters
What are some of the best purchases you’ve made recently? Chances are if you remember them, they could be considered a good splurge.
What makes a good buy is different to each person. If looking your best is important to you, spending more on salon-brand shampoo or designer clothing might be worth it. For cooking enthusiasts, it might not be a bad idea to fork out extra cash to invest in premium kitchen tools and fresh produce. Apart from personal priorities, you can also consider how often you will be able to enjoy the splurge.
Even if it might seem superfluous to onlookers, if the spending brings value to you, go for it.
On the other hand, spend as little as you can on things that you need but do not care for. Again, this varies depending on your preferences. Look at your spending and decide which expenses you would be willing to shell out more funds on and which ones to go budget for, be it toilet paper, beauty products, pet food, entertainment or others.
2. Set aside to spend
With big spending, often comes a concern that it will put a dent in your wallet. But a splurge does not have to be completely impulsive and reckless – by planning it ahead, you can keep your finances under control. Set aside some of your income and/or savings as a designated fund for frivolous indulgences. When considering how much to budget, take into account your general expenses and goal savings to find out how much you can spend on the “fun” part.
3. When in doubt, wait it out
Ever have the urge to grab some coffee and pastry when you’re passing by your local café? This impulsive spending that you decide in the heat of the moment might seem small, but it can easily add up.
Instead, consider your priorities and sit on any desire to splurge for at least a few days. This will improve your ability to identify fleeting whims, and give you more time to make sure that the potential expense will fit your budget.
Do you have any tips on how to splurge wisely? Let us know in the comments below.