Spending Money is Good

by Ryan Guina

A lot of personal finance blogs focus on finding ways to save or invest money. If you are a regular reader of this blog, you know saving and frugality are topics I spend a lot of time writing about. And with good reason – maximizing your savings and investments is one of the most important things you can do for your future. That is because money saved now is worth more than money earned in the future. The time value of money, compound interest, taxation, and other factors play a key role in this fact. But there is more to life than just saving for a rainy day, or investing until your net worth is the size of a small country.

Money is only meant for one thing – spending.

Think about it for a minute – why do people focus so much on saving and investing? It’s so they can have more money later… to spend. Otherwise there would be no point in saving or investing. The key is to spend less than you earn, but still enjoy life in the present.

It’s OK to splurge

JD, from Get Rich Slowly, asked several personal finance bloggers and his readers what they splurge on. His article contained responses from about 15 personal finance bloggers, and elicited over 150 reader responses. The items people chose to spend a little extra on, even when it wasn’t necessary, shared a common bond: they make life a little brighter and more enjoyable now.

Spend money on the important things in life

Everyone had at least one item they often splurged on. The most common items I noticed were food, experiences (travel, concerts, eating out, etc.), quality of life issues (clothing, appearance, housing, etc.), and recreation.

People splurge on things that are important to them. My answer was experiences (more on that below). But others prefer to spend extra money to enjoy life every day with a nice meal or a quality glass of wine. Others prefer to spend more money to decorate their house or buy nice clothing. Sports, video games, and other recreational items bring others joy.

I like to spend money on experiences.

Last fall my wife and I took our honeymoon – a cruise on the Mediterranean Sea. We traveled to Spain, Italy, France, Corsica, and Gibraltar. We did as many excursions as we could, ate wonderful food, and had an exceptional time. The memories we made during our honeymoon will last our lifetime. We spent several thousand dollars and came back with nothing but memories, hundreds of photographs, and a few small gifts for family. And it was worth every cent.

My wife and I also like to travel or go to ball games, concerts, musicals, and plays. These are experiences you have to pay a lot of money for, and when it is all said and done, there is nothing tangible to show for it (unless you buy overpriced souvenirs).

So what? Having the opportunity to see a commemorative showing of The Phantom of the Opera in London was an awe-inspiring event. Rock concerts? I have been to dozens. I have spent hundreds of dollars on live concert events, but I have seen some amazing bands perform live and it was worth every cent.

Money is for spending. Money is for living.

It’s easy to get caught up in debt reduction or retirement planning and get stuck in the rut of “cut back, spend less, save more, repeat.” It’s easy to forget that life is more than just living for tomorrow. We need to remember to live for today, while we think and prepare for tomorrow.

Let me give you an example: One of my favorite personal finance blogs is Gather Little By Little, which chronicles the author’s journey out of debt. Glblguy shares his experiences, and though he has a ways to go before he is debt free, he and his wife have made great progress. One of the things I really enjoy about his blog is candor in sharing his financial decisions. You see, even though he has debt, he still knows it is important to spend money now.

The best example of this is a recent article in which Glblguy shared how he bought his wife an engagement ring on-line to replace her old one which they had to sell because of financial hardship. I know this was a difficult story to write, but it illustrates how dire their financial situation was, and how much it affected them emotionally. When they had an unexpected tax return, they decided the money was worth more to them to replace the ring than it was worth to repay debt. And I agree, 100%. This is a must read story to understand why spending money now is just as important as repaying debt or saving money for later.

There is more to life than repaying debt or saving for a rainy day. Money is for spending. Money is for living. After all, life is too short to drink cheap beer.

Published or updated July 5, 2011.
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{ 10 comments… read them below or add one }

1 No Debt Plan

I definitely think there are times when we forget why we are living the way we are living. It’s eventually going to be spent or given away, so why not enjoy it once you are on stable footing?


2 Alan

Well so many people just live in the moment and that’s the kind of thinking that does lead to there downfall and financial problems. Too many people think that since they can support themselves with the lifestyle they have at the moment, there set for life with that lifestyle and for the most part that’s not going to work.

Otherwise the Armani coated people and corporations wouldn’t be going bankrupt. Life sends curve balls and you should be ready to hit them.


3 Shanti @ Antishay

AGREED! I’m nearly done getting out of debt (one more month!!) and I’m thinking a lot lately about how I won’t have to be so tight with money anymore. I still buy myself an occasional meal out with friends, or a $15 case of beer (mmm!) but on the whole I live far more frugally than any of my friends do. I will continue to live that way overall (I honestly prefer it now), but I won’t hesitate to save up to spend on something later. One of my biggest wants right now is a motorcycle, which I have kept as a carrot dangling in front of me for YEARS as I’ve paid off this debt. I can’t wait to save up and buy me one (I’m thinking $2k) and some gear. YAY! Because that bike will bring me some awesome experiences I won’t ever have otherwise ๐Ÿ˜€



It’s important to find out what is really important in your life; what brings you both joy and utility. It’s ok to splurge now and then so long as it’s meaningful for you.


5 Trent Hamm

Moderation is itself often a challenge, so often financially sensible folks tend to err on the conservative side of moderation.


6 Mrs. Micah

I greatly appreciate having a quality violin (well $2000 isn’t high quality, but it’s actually decent). Took me a year and a half to save up for it, including some family gifts. But that’s what the money was there for. Or a trip to Europe, again lots of savings and some gifts.

I think for me it helps to save up because that gives me time to realize whether it’s something I really want or something I think I want.


7 El Cheapo

The more that I hit my savings goals, the more I realize that no amount of money in the bank will make me truly happy. After paying myself first and saving for the future, I find myself quite readily chasing experiences and sharing them with family and friends.


8 Ryan

I see a few common themes in the comments here: “too many people live in the now,” and “enjoy life while you can.”

I think it is important for people to remember their long term focus and goal (live within their means and save for retirement) while still enjoying life in the present.

Without a balance, life can quickly lose some of it’s meaning. I’m not saying it is easy to reach this balance, but it is something we should all try to find.

Life is here for us to enjoy, and for me, that means having fun and enjoying life now, but also preparing for my future with my wife and family.

Thanks for the comments everyone. ๐Ÿ™‚


9 Looby

This is a great article and perfect timing for me. I was just feeling a bit guilty about spending so much money in the last couple of weeks as I paid my evening class fees. But you have reminded me that to me they are worth it. I learn new skills and have a great time.


10 John Aitek

Money can be a defense against disasters, e.g. if your car needs servicing.


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