Spend and Invest on Yourself Without Guilt

Chronic spending can be bad, but chronic underspending can be just as bad.

Why?

This is because people who are chronic underspenders regularly ignore important things like investing for their own healthcare and home repairs, only because they fear running out on money. But let’s face it: everyone has this fear. But if every person ignores essential spending just due to this fear, then it just won’t do. One expert says there are a few ways to ease their distress: determining which expenses are actually investments, and creating a budget.

When it comes to a frugal person, ‘spend’ is a very bad word. For them, spending money equals total waste.

Having a financial plan and a budget shall help those who wish to use their money better.

But why are we talking about budgeting and having a financial plan when you don’t want to spend in the first place?

That is because you have to spend on yourself first. Having a few high quality purchases now and then shall save you from the “frugal fatigue.” This is the mental fatigue that comes in when you focus on saving too much, and not on yourself. Look, this fatigue shall ultimately come uninvited, no matter how frugal you are. It causes a burnout which reverses all the monetary goals you save for yourself.

What you need to do therefore is to toe the line between overspending and underspending.

1. Create a budget for yourself: The most important thing you can do in your personal finance life is to have a budget. Here’s what happens without one: you splurge heavily one month, and save up equally as much to make up for it the next month. Having a budget helps you to see where all your money is going, in what quantity, and what you spend more than necessary on. It saves you from spending on a whim as well.

2. Determine your investment plan: Here’s where it gets interesting. You have to spend and invest on yourself. Years after spending and saving on external things you’ll feel that you have not done anything for yourself. Now, coming to the topic of splurging, experiences do give lasting pleasure, but if you buy the right things, you invest more in your happiness.  

3. Don’t wait till the end of the process: Do not wait till you have achieved all your monetary goals to splurge a bit. For instance, it takes years to create emergency savings, and decades to create a retirement fund. You need not be completely frugal till you have achieved all of these because these take too long. You have only one life, so you have to enjoy it a bit as well.
   
   We’re not saying spend everything on fun, but not spending anything on yourself is not good either. Here is how much you should save: enough to replace 70% of your income when you reach retirement age. You should also be saving enough to replace all your toxic debt, loan repayments, mortgages, and other forms of debt.  

4. Save before spending on fun: Invest on yourself and have fun, that is what we say. However, before you do that, it is important to save up. For instance, if you want to buy a new guitar, save up for it instead of buying it unplanned. 

5. Use better finance strategies: You already know that you should not pay for all the fun things you want to experience or buy, yet you still find yourself doing just that. Perhaps you have taken loans to, for instance, buy an iPhone. The thing is that borrowed money feels easier to use or splurge with. With loans, people tend to buy things they don’t need. How to make sure you can afford what you are buying when using loans? Use conservative loans with fixed rate interests and long loan terms

We at mymoneykarma home that these tips help you.