It’s not at all unusual to read posts from me about cutting expenses, funding your emergency fund, or saving for retirement.
There’s something else you should do in your quest to live a frugal life:
Splurge a little.
You read it right. Periodically, you should spend a bit of money on whatever it is you want – a vacation, a new gadget, new clothes, or whatever your heart desires.
Now, I’m not saying you should put those purchases on a credit card. No, that would go against everything I preach around here. Instead, I want you to budget for the splurge. Set aside a bit of money to just do “whatever” with.
So why would the Northern Cheapskate tell you to spend? Because all work and no play makes Jack a dull boy!
We need to have a little fun with our money, too, because it enriches our lives and makes all that hard work worthwhile.
The key is to make sure you have done the hard work first. So make sure you’re making good progress on debt reduction. Make sure that emergency fund has got you covered. Make sure you’re being good with your money.
And then, splurge. With cash. Stash away a few bucks every week. Squirrel away all your spare change, or dump part of a windfall (like that tax refund) into a fund that you can spend on something fun for you and your family.
Set aside some funds to treat yourself now and then and you will find that you become more dedicated to reaching your goals. Experiencing something new can inspire you to be a better money manager, and can help you figure out what is most important to you.
If all you ever do is cut expenses and work, you’ll burn out. And splurging when you’re burned out is the most dangerous way to splurge. That’s when we all start to do really dumb stuff with our money.
Instead, make it a point to budget some money to blow every once in a while. It makes the road to financial freedom a lot easier to travel.