When I ask people how spending money makes them feel, so many of them respond, “Guilty.”
They’ll give an example of how a rough day at the office led to buying a pair of shoes online or how they got a little carried away at their friend’s bach party in Vegas.
But spending your hard-earned money on something you enjoy should be exciting, not regretful. So why do many of us feel awful when we spend money, even if it’s on something that actually makes us happy?
How To Start Enjoying Your Money Guilt-Free
A big reason why people feel guilty about spending money is they fear that it could be going towards something better or more important.
This feeling is usually the result of a lack of planning. When you’re not sure if the $100 you just spent on shoes was part of your grocery budget or dream-home down payment, no wonder you feel guilty.
To combat this, limit impulse purchases by having a plan for each dollar in your paycheck.
For my Wealth Coaching® clients, we give every dollar they earn a specific job. Some dollars go towards bills, others go towards goals, and there’s always a portion of each paycheck that’s reserved exclusively for living your best life today.
A good rule of thumb is that 30% of your paycheck should be reserved to spend however you want. (So if you need to buy yourself some sympathy shoes or want to live it up in Vegas, there are funds for that.)
A Financial Plan Will Shift Your Money Mindset
Having a plan for your money will cause a mental shift in the way you view spending. Instead of thinking, “I should be doing something more responsible with this money,” you’ll start to think, “All of my bills and goals are covered so now it’s time to treat myself for working hard because I earned it.”
You’ll also have a lot more fun figuring out what to spend your money on once you have a financial plan. When you know you have a specific amount of “fun money” each month, you can plan to spend it in a way that makes you as happy as possible.
For example, I have clients that plan to go to multiple concerts each month because they know they have a certain amount of fun money and that’s their preferred way to spend it. Planning in advance allows them to save money on tickets, get the best seats, and get excited for the event. Studies show that anticipating an exciting event often creates more joy than actually attending the event itself.
When You Should Feel Guilty
While being able to spend your hard-earned cash without feeling guilty is a sign of financial health, there are certain situations where you actually should feel guilty about your spending.
If you’re going into debt or missing your savings goals, then the guilt you’re feeling is definitely warranted. It’s difficult to spend without guilt if you know for a fact you are dropping the ball on some key financial basics.
If you aren’t going into debt and are saving for your goals but still feel guilty about spending, then your guilt probably has less to do with spending overall and more with what you’re buying specifically.
If this is the case, I’d recommend you do a Choice Spending Check. All this requires you to do is write down everything you spend your money on for seven days and rate each purchase. If the majority of the things you buy aren’t things you need or love, you can eliminate your guilt by eliminating those low-value purchases.
Don’t Overspend, Save for Your Goals, and Spend Guilt-Free
As long as you’re not going into debt or neglecting your savings, you should be happily spending your extra money guilt-free on the things you love.
You spent decades in school preparing yourself for a career. And now you have a job where you put in hours and effort every single day.
What’s the point of all this hard work if you can’t enjoy the fruits of your labor?
Saving money is important, but you don’t take your bank account to the grave with you. Rewarding yourself in the present is extremely important and will help to keep you motivated throughout your career.
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