With all the effort we put in to keeping ourselves on a sensible financial plan, it might sometimes seem like there aren’t enough opportunities to treat ourselves or to splurge on things that might not otherwise appear to be “sensible” purchases.
But making appropriate financial decisions doesn’t have to mean that you can’t splurge from time to time. Denying yourself each and every “guilty pleasure” – even small ones – might eventually lead you to make an expensive and indulgent that does significant damage to your financial health.
The key is to limit yourself to splurging when it makes financial sense. It’ll be a different answer for everyone, but here is some banking advice and guidance on when doing so is acceptable.
Splurge When You Can Pay Cash. The most important principle in splurging on something – particularly when we’re talking about relatively inexpensive items – is to pay cash. If you don’t have the cash on hand to spend, then it’s probably not an appropriate time to splurge. Avoid putting splurge items on a credit card, because you don’t want to have to keep paying interest on your purchase for months or even years into the future.
Splurge on a Truly Special Occasion. Notwithstanding the prior advice, sometimes there might be instances when it’s appropriate to splurge even if you can’t pay for the item in cash. These might be “once in a lifetime” occasions such as your child getting married or graduating from college. Still, even in cases such as this, it’s a good idea to try to avoid doing significant damage to your budget, and minimizing the amount that you charge.
Splurge As Long As You Don’t Make a Habit of it. Remember that a “splurge” should be just that – an uncommon expense. Don’t let the thing you’re spending on become a habit. You aren’t looking to add a new line item expense to your monthly budget. Appreciate the splurge for what it is, and then get back to your more responsible spending behaviors.
Splurge if it Can Save You Money. Sometimes a “splurge” isn’t actually a bad financial decision. In some instances, spending more money on a particular item can save you money in the long run. For example, you might think it to be extravagant or a bit of a splurge to buy an expensive set of kitchen knives or cookware, but if those things will last for decades then you’ll avoid having to pay the cost of replacing cheaper knives and cookware multiple times.
Responsible financial behavior doesn’t mean that you have to deny yourself the occasional splurge. Splurging for yourself or your loved ones can be a great pleasure, but it doesn’t have to cost a lot or break your budget.
With all the effort we put in to keeping ourselves on a sensible financial plan, it might sometimes seem like there aren’t enough opportunities to treat ourselves or to splurge on things that might not otherwise appear to be “sensible” purchases.