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How to Spend Money on Fun

This article was written by in Personal Development. 13 comments.

The point of accumulating and saving money is not to die with the most money in the bank. Yes, it can be helpful to your heirs to leave a fortune for the next generation, but not at the expense of living a fulfilled life yourself. There are many opinions about what it means to live a fulfilled life, but for most people, it involves taking the time to do whatever you’d like to do without needing to be concerned about the financial consequences, or whether you’ll have enough money to buy food tomorrow.

Doing whatever you’d like to do doesn’t have to cost money, but sometimes, it does. Some people could be happy living off the land, finding their own meals, and surviving on their own without ever spending a dime. Self-sustenance is an interesting concept and I have respect for people who can manage to live their lives this way. Most of us are consumers, however, and thus earn and spend money in order to live.

You’re reading Consumerism Commentary because you’re interested in finances on a personal level, but it’s important to remember that net worth and income are not the core concepts of living life. I wouldn’t be who I am without the aspects of my life that do not involve earning income. Society could not function if the only activities its inhabitants performed were those activities that other members of society would pay them to do.

Fun SnowboardingIt’s advisable to look for deals when we shop. If we’re spending money in a store, it pays to ensure we’re getting the best price. That could involve bargain hunting, negotiating, and comparison shopping. Paying attention to price and value plays a big role in everyday and occasional spending, but the usual goal in this type of frugal philosophy is ending the day with the most cash left in your pocket. I offer a different goal: ending the day with the experiences that shape you as a human being. It’s harder to measure, but at the end of your life, you’ll likely have fewer regrets and be more satisfied with how you’ve spent your short time alive on this planet.

Let’s call those experiences that add up to a fulfilled life “fun.” They might not always be enjoyable, but you collect these experiences and you can find a method of tallying and rating them. These experiences have the most meaning to you now and in the future.

Here are some tips for spending money for fun.

1. Necessities come first.

Before you can consider partaking in an experience that doesn’t have a positive effect on your net worth, you need to clear a few hurdles. These suggestions speak to the top of Abraham Maslow’s Hierarchy of Needs. I keep coming back to this cope psychological concept, and it might annoy anyone who has studied psychology beyond an introductory-level course, but I feel it’s symbolic of how to best organize personal finance, particularly spending.

The lowest level of the pyramid represents your physiological needs, everything you need in order to survive each day, namely food, water, heat, and shelter. In most communities, basic clothing is also a physiological need. It would be very difficult to rationalize spending money on anything else before these needs are met. Granted, you could avoid some of these expenses by living off the gratuity of family and friends, but that can only last so long — particularly if they see you spending money on fun things without considering moving out.

Feeding your need for self-actualization is a luxury. Climbing the Hierarchy of Needs pyramid can be tough, and focusing on enriching your life comes after your basic needs are met.

2. Define our goals and values.

Once your household has overcome any difficulties in the way of providing the basic physiological necessities, there is an opportunity to think about the big picture. There are many people stuck here, believing their goal is to earn money. Earning money is not a goal in itself, it’s only a path that allows individuals to meet other goals. A friend asked me for financial advice, and although I’m not a financial planner or adviser, I agreed to talk to him and help him think through his issues.

I asked what his goals in life were, because knowing this would be the only way to help someone plan for the future. He said his goal was to retire with $5 million in the bank. Regardless of whether that was a reasonable number, it wasn’t a real goal. I asked him why he wanted that particular sum, and he had never thought about it before. We started to work out what he would do with that money and why it was important for him to be financially independent. You need real life goals, not money goals. With real goals, you can evaluate whether the money you spend is worthwhile, and you have a purpose for saving and investing other than a big balance on your monthly bank statements.

In addition to goals, you should be aware of what ideals are important to you. A set of values defines how you live your life, where you spend your time, and an initiative for your funds beyond the selfish but necessary act of taking care of yourself.

3. Pay off debt.

Being debt-free is the most important financial goal. When you’re in debt, you’re beholden to someone else. Often, that someone else is a company with significant means to make your life miserable if you can’t pay. There are avenues for help if you need it, like bankruptcy, but for the most part, you can’t life a fulfilled life when part of the money you earn is dedicated to someone else.

If you’re earning $3,000 per month and paying $2,000 in interest to your mortgage company and credit card issuers, your income is basically owned by entities other than you. If the remaining $1,000 covers nothing other than your necessities like room and board, you are living in indentured servitude. Some might even say that debt is slavery. You should want any income you earn to be rightfully yours.

These suggestions are not necessarily in order. You can pay off debt while still determining your long-term goals because no matter what goals you choose, being debt-free will be key. In this case, debt includes mortgages and student loans, not just credit cards. Any interest obligation is a waste of your money. You don’t have to be completely debt-free to begin considering spending money for fun (that is, life enrichment), but you should have a plan in place for doing so and for emergencies that might cause trouble along the way.

4. Save for the future.

Living a fulfilled life often means striking the right balance between saving for the future and using the money you earn today for more than just necessities. Again, that’s a luxury that’s best considered only by individuals or families who have done a good job of saving for their future already.

It may be possible to save too much money, but many will not reach the point where this is a concern. There will always be more we can save for the future, but those who are on the path to a more comfortable, debt-free life have more options for spending today without sacrificing their future.

5. Compare your spending with your values.

If measuring success with saving money, the scorecard is simple. Your net worth and net income statements provide feedback. You’ll know where you stand at any moment from a financial perspective. When collecting experiences leading to a fulfilled life, keeping track of your progress is more difficult to measure. You could look at your discretionary spending and compare it with your values. Give yourself points when your expenses match the type of person you’d like to be and give you the feeling that you’ll be satisfied when you look upon your experiences. Subtract points if your spending was frivolous, not well-considered, caused regret, or prevented you from living life in the way you’d like to.

When it comes to spending money for fun, I am a big fan of spontaneity. Being impulsive or spontaneous can be responsible or irresponsible, however. If you’re striving to fill your life with rich experiences and to never look back on your time alive with regret, you can help increase the chances of creating a life you enjoy by taking a responsible approach. Everyone should get a chance to spend their hard-earned money how they want, but that freedom comes from the ability to make a few good, important choices about how to handle finances.

Published or updated November 28, 2011.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 13 comments… read them below or add one }

avatar 1 Anonymous

Let me add a couple thoughts about the “end game” – retirement. Next month my wife and I head out on a cruise (11 days in the Caribbean) and we splurged a little on a suite. But in 2011 we’ve spent 85% of our fixed income (~68% of total income) and that kind of managed spending in retirement allows us to splurge occasionally. Although we’ve set a goal of leaving the same purchasing power we had on the day we retired in our estate, we saved that money to enjoy retirement. If we maintain positive cash flow the estate may turn out to be a little more, but it may be a little less – only time will tell.
I am not a big fan of spontaneity because the planning is great fun and a well planned trip is worth the effort.

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avatar 2 Anonymous

I make savings automatic and then I have much more freedom in how I spend the remainder of my money. Every other year, we take a major overseas trip. It is our way of having fun.

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avatar 3 Ceecee

Once you get into a mode of saving and paying off debt, it is hard to let go and just spend on some fun. But I remember the few Broadway shows I splurged on much more than the things that are still sitting around the house collecting dust.

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avatar 4 lynn


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avatar 5 wylerassociate

My idea of fun is traveling across the country & attend as many bruce springsteen concerts as I can afford. Since I live in Arizona, I try to attend shows in Phoenix, Las Vegas, Los Angeles, Anaheim & Detroit when I go back to Michigan to visit relatives. It is so much fun & I’ll be attending some shows next year when he goes back on tour.

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avatar 6 lynn

Just recently, I made a decision to begin spending money on things I like. I have been frugal my whole life, so now I have to decide what I want to do. The problem with me is I’m easily entertained.

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avatar 7 Anonymous

I am totally agree that the life is a collection of experiences on the road to financial independence.

Comparison does play a big role, but then you need to realize what you really want NOT the amount of money you “save”. By the way in original Maslow’s hierarchy was sex, as well, as the physiological necessity.

On the item #3 – our governments and all so-called developed countries around have deficit budget for decades and it is OK. Why should not we?

There is no/very little incentive to save – inflation is in the high 5%, interest on savings/deposits hovering around 1% and stock market under-performing year after year. What is the point?

Should not we follow the leaders and spend, spend, spend? It is OK for the country, maybe we need to do the same.

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avatar 8 Anonymous

I agree. I wrote a blog post a couple of years ago about how spending is better than saving when times are tough and how those that did came out ahead.

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avatar 9 tigernicole86

I’ll admit it, I haven’t been as good at savings at I could. Especially for retirement. But this summer I finally started in my comapny’s 401K plan, started throwing the “extra” money into my savings account so that I can take a trip to see my sisters overseas(which I am way too excited about!) with my boyfriend. Sometimes I’m a real spendthrift but my bills are being paid off(with extra payments, thank you!) and my basic needs are more than well met.

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avatar 10 Anonymous

My wife and I have a newborn and a one and a half year old. We’ve decided to demolish our mortgage over the next seven years…..based on one condition; that we still have fun. We figured that since the kids don’t care if they are in a sandbox or on a beach in Costa Rica, we’ll pay the house down and then when they are a little older, we’ll have the means to do some really meaningful trips. In the meantime, we’ll go for bike rides and hit garage sales on weekends. If we find we aren’t having fun, we’ll scale back our mortgage payments.

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avatar 11 Anonymous

Once you save enough, if you don’t spend money on fun, your money is spent on others after you die. This happens in a way you can’t enjoy and have no control over once it’s given. If you know you’ll die when you are really old, it wouldn’t be so much of an issue except that it’s easier to enjoy money when you’re younger and anybody can die at any age.

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avatar 12 Cejay

I have such a hard time with spending money on fun. I feel that you spend the money and you have nothing to show for it. Sure the feelings you get when you are doing the activity is nice but what about a month later? We are saving in our 401K, a Roth IRA, everything is paid for so I know that I should let go. We are going on a cruise to Alaska in August, something I have wanted to do for years. But the money spent just stays on my mind. But the families will get a shock when we die. Everything is going to charities since I hate the thought of our families just spending the money we worked so hard to get. I know, I know it will not matter then but it matters to me now.

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avatar 13 Anonymous

What do you have to show for it when you save too much money? It’s just ink on paper or light coming from your screen telling you your balances. :-) At least with fun, you have nice experiences that can be remembered or things that you enjoy on a regular basis.

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