Learning To Spend Money

It’s a funny thing about money. Some of us have no problem spending every penny we earn, while others have strict rules about how they spend and save money.

In the world of personal finance, I’ve come across a lot of bloggers (and even more “commenters,” individuals without a website who comment on personal finance posts) who are amazing at saving money. They are great at budgeting, they keep track of every dollar, where it goes, how it’s invested. They build up huge emergency funds – which, by and large, they never have to use – and many of them contribute the maximum amounts to their tax-exempt retirement accounts. They pay down debt while refusing to take on new debt. In short, they lead exemplary lives from a financial point of view.

Except for one thing: they don’t know how to spend money.

And this is a problem.

This isn’t a problem unique to personal finance bloggers and those who read these sites. It’s a pretty universal problem, as illustrated by an old Fidelity commercial that shows a husband and wife following that ubiquitous green line as they learn how to spend money in their retirement years. We spend years learning how to save money, invest money, budget money – but, except for the spendthrifts among us – do we ever really get comfortable spending it?

I’ll admit, sometimes I have issues here too.

For example, my wife Lauren and I are finally taking our honeymoon this month. Back in September, when I asked you how much we should spend on this trip, we’d already started saving for it. In fact, by the time we arrive, we’ll already have enough money to pay for it in full. But, despite our solid budgeting, despite the fact that we’ve earmarked this money for this specific purpose from the very first penny, it’s still hard to actually hand over the cash – or check, or credit card, etc.

Here’s another example: a friend of mine has been saving up for a new car for literally years. Each month, he funnels a portion of his paycheck into his designated “new car” account. He’s almost reached his goal…and yet, now he’s starting to waffle. He’s making excuses (“I don’t really need a new car; my old clunker gets me where I need to go” – this is a fallacy, as his car has more starts and stops than Lindsay Lohan’s movie career), trying to come up with a reason – any reason – why maybe he shouldn’t spend the money on something he not only needs but wants. It’s not that he’s suddenly decided he doesn’t want that new car; rather, he’s getting gun shy about pulling the trigger on such a big purchase.

I can understand that; I can sympathize with that. I know that it can be almost painful to spend money, even if you’ve spent a lot of time budgeting to spend it for exactly that purpose.

But here’s the thing – if you’re going to make the effort to save all that money, shouldn’t you at least feel good about spending it? Shouldn’t you bask in that sense of accomplishment (“I saved for X, and I reached my goal!”) instead of feeling guilty as you make the big purchase?

Do you ever feel guilty making a purchase, even if you’ve budgeted to spend that money in a specific way?

12 Responses to Learning To Spend Money

  1. I am a frugal person so I always feel guilty spending money on most things. There are a couple of things where I don;t mind spending money and those are vacations and eating out at a nice restaurant. Those are two things that I enjoy in life and I am not going to be cheap about them.

    • Daniel says:

      @Sean @ One Smart Dollar, I don’t think it necessary has to do with being cheap, just parting with money. Even if I budget $1,000 towards tv, when I go and buy that expensive tv, I’m going to say to myself, “I can buy the $500 one and keep that other $500 in savings.”

  2. Christian L. says:

    Daniel,
    I sometimes feel guilty simply because of the price tag. But I feel worse if I end up seldom using the product/service. It’s a bad investment to buy snow pants you’ll wear twice a year, or a bicycle component for which you don’t have a bike.

    -Christian L. @ Smart Military money

  3. I totally fall into the category that needs to learn to spend. I’d rather save aggressively now while I’m young though. Unfortunately, that’ll make it harder to spend it later!

  4. Pauline says:

    I have a hard time parting with money when I don’t think that I am getting my money’s worth. If I save for a $12K car and then realize that I can do with a $8K car that will be reliable and take me where I need, I’d rather keep the difference for other goals. But sometimes I would sacrifice comfort or convenience for a few dollars and have to learn that money is also made to buy that.

    • Daniel says:

      @Pauline, I totally agree, and go through the same things. Maybe it’s because I still have a college mindset, but I always try and save if it means I’ll have more later. Maybe we’re TOO GOOD at delayed gratification?

  5. krantcents says:

    I never feel guilty about spending money because my purchases are well thought out. I am concerned about spending in my retirement because this lifelong saver will have to cross over to spending and stop saving. I am starting now because I am 5 years away from retiring again.

  6. Sharon says:

    Learning how to spend money wisely will keep you off the hook for unwanted debts. It’s better to adopt good money habits than regret it later on.

  7. Money Smarts Class HS says:

    Sometimes, because after I purchase something it’s like “why did I buy this?” or land up never using it again-it’s an awful feeling.
    If I have already decided on buying something, I already have put some thought into it-so my answer is no.
    Yes, i do feel guilty, because I am not sure if that is what I want to spend my money on.
    Yes, because I make excuses of why I don’t need it because I hate spending money.

  8. Kathleen, Frugal Portland says:

    I’m frugal, too, but I don’t have a problem spending money. I took a friend out to dinner on her birthday and didn’t worry about the cost since I never go out.

  9. Ross says:

    I find that I don’t mind spending money once I’ve already committed to doing it with friends. But when im alone, I start making excuses even if I’ve saved for something… probably a habit I need to work on

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