We are used to thinking of splurges in negative terms. A splurge is often an unplanned purchase — especially if that unplanned purchase is of something you don’t need. With the prevailing mindset that every dollar is supposed to be accounted for ahead of time, splurging can seem like the ultimate bad money management move.
But is it? Could splurging be a positive thing? According to some people, it can be, as long as you can actually afford it.
While we think of splurging as unplanned in many cases, the reality is that splurging can be planned—in a way. You can set up a “splurge fund” so that you have enough money to make impulse purchases, or build a splurge into your monthly spending plan. My husband and I regularly make unplanned purchases (mainly because our “spending plan” consists of covering all of the most important costs first, and then spending until the money’s gone each month), and we don’t usually have issues because we don’t spend unless we can afford it.
Judi Cinéas, Ph.D. and LCSW, is a psychotherapist who points out that splurging should be viewed as a reward. “When working on goals, I always recommend that clients set a reward schedule,” she says. “Those rewards can include splurging on things they normally don’t get.”
The key, though, is to make sure that the splurging is affordable. There is a difference between splurging as a reward for a job well done, and splurging that results from negative triggers, according to Cinéas. Splurging can be fun, since the new purchase or experience can be a lot of fun, releasing good-feeling hormones. But if you are splurging in response to a negative emotion, and using it as a way to cope with problems, you can quickly get out of your depth financially.
Instead, make sure that you only splurge when you can truly afford it. Grant Cordone comes at splurging from another side. He’s been in sales for more than 30 years and sees splurging as a way that people solve problems. “This is why women will spend more money on a wedding dress than they would on any other item of clothing in their lives,” Cordone says. “The problem is ‘I want to be a memorable, beautiful bride on my special day.’ The solution is splurging on a dress for this very special occasion.”
Cordone says that solving these types of problems with splurging can make sense, if you can afford it. You feel good after. “When I splurge on a new watch for my wife for her birthday, it’s a good splurge. I can afford it. She will like it. Win-win!”
But he, like Cinéas, points out that negativity is not a good reason to splurge. “Whenever there’s a negative cause leading to the splurge, it’s not a good splurge. Anytime a splurge is bought on credit unable to pay off in full in a short period of time, the person can’t really afford the splurge.”
When Splurging Makes You Feel Worse
Affordable splurging, like knowing that you can go out to an impromptu dinner with your friends, or knowing that you can buy those shoes without breaking the bank, can help you feel good. You have the money, and there is pleasure in being able to get what you want. Even saving up for a spending spree can feel rewarding, since you have worked hard to save the money.
But there are times when splurging can make you feel worse. Cinéas points out that if you can’t afford the splurge, you end up feeling especially bad. If you splurge as a response to your latest problem, you might feel good temporarily, but in the long run that feeling wears off. “The issues still exist, and on top of that you have now spent money that you did not have to spend, so now there is the added stress of debt.”
Splurging isn’t always a bad thing. A splurge on something that you genuinely enjoy can help you ward of feelings of scarcity when you are trying to save and pay off debt. This can keep you from feeling as though the whole operation is no longer worth it.
However, the key is to keep splurging affordable. If you can’t afford the splurge, then you could end up in worse shape than before.
What do you think? Do you like to splurge? What do you splurge on?