This may come as a surprise from a personal financial blogger, but I actually think it’s important to spend money in our daily lives. A lot of my posts are all about saving and investing money, or not spending money but I thought I’d share some insights into why I think it’s actually important for you to spend some money. Life is short and we only have one life to live, and I think that going through life without enjoying money isn’t that great of a life!

Where this revelation came from 

I love to travel. I don’t spend my money on a ton of different things, but traveling is one of them. If you haven’t seen it, I have a whole sister site dedicated to my traveling adventures. I recently spent a whole week in Iceland and it was a great time of personal reflection. It’s always so helpful for me to get away every now and again and mentally recharge. It’s great not having work or other obligations, even just for a few days. While on vacation, I found myself with a desire to still save money. I’d forgo little activities or purchases to ‘save money’. During the trip, I realized that I am so used to having an attitude of not spending that I forgot that I actually budget “fun/travel” in my budget, and should be enjoying it! Although I had budgeted for the trip, and had planned on spending the money, I didn’t have the right mindset in place and it was holding me back! 

So, for the second half of the trip, I adopted a new attitude and kept to my budget (i.e. eating cheap for breakfast/lunch and out for a nice dinner) but enjoyed spending the money that I was spending! I was really struck by this revelation and thought I’d share my thoughts on why it’s important to spend money. 

Find out what you want to spend your money on

Money isn’t everything, but it’s what we spend most of our lives (40+ hours/week) working towards, and it’s what allows us to keep living (i.e. food, shelter) and even enjoy life a little. I’ve been reflecting recently that the secret to life is balance, and that includes balance with money. If you work so hard and don’t enjoy your money, you are arguably more prone to burnout and ultimately I think you’re missing the point. Although I’m a big believer in setting financial goals for yourself and achieving them, I do think that it’s important to budget some enjoyment with our money. 

With the goal of spending money in mind, how should a young professional go about spending their money? I think the real key to spending money is spending it in such a way that brings us happiness and joy. Too many times I’ve myself have spent money on things that I don’t really need, or didn’t really want, and either had buyer’s remorse or the allure of the new item quickly faded away for me. Does this sound familiar to you? 

I think what’s important is first figuring out what’s important to you, and choosing to spend your money that way. Choose to spend in areas that will make you happy and help you enjoy life, and then save in the other areas. For me, I really enjoy traveling. I try to take one or two big trips each year and really enjoy my vacation time. Whether it’s Asia, Europe, or even a beach somewhere (Bermuda is my favorite right now), I like to spend my money on travel. Of course it’s not cheap, but I don’t spend money in other places to allow me to spend my money where I want to. I pack my lunch most days and don’t often buy new clothes. I only see maybe two movies each year in theaters, and don’t even own AirPods (gasp!). The point is, I have figured out how I most enjoy spending my money, and choose to spend it there! 

What about you? Where do you enjoy spending your money? What brings you happiness and what doesn’t? 

Do meet your financial goals, but include spending in there

Now that you’ve got a plan for how to spend your money, it’s also important to focus on the bigger picture and making sure your spending is inline with your overall financial goals and budget. I budget ‘travel’ money each month, and most months I don’t spend that amount, and roll it into my ‘travel fund’. Outside of that, I do still budget for eating out (fun/entertainment/social) and do so. However, I am still contributing to my 401(k) at work, an contributing to my Employee Stock Purchase Plan to buy company stock at a discount and am paying my mortgage each month. Because I have a good saving/investing amount each month, I feel good about leaving room for me to enjoy my money! 

So, don’t feel the need to save every penny you earn, and don’t feel the need to stay in every night. We only have one life to live and it’s important we live it in a balanced manner; saving for the future but also enjoying the present! 

What about you? How do you balance saving/spending and are you too focused on one vs the other?