How to spend your money

Yesterday, as I was otherwise occupied (I spent five hours writing a post about programmable thermostats, a post nobody will even like!), the conversation on Donna Freedman's article got a little cranky. Donna wrote about pinching pennies on some things so that she could splurge on others. In Donna's case, that meant a trip to England.

Tyler K., who's always a little cranky, wrote in response:

I'm just waiting for the post where someone's passion, the thing they're willing to scrimp on everything else so that they can afford, is a Range Rover. Or anything else but travel, really…It'd be fantastic to see someone write about not going to Europe so they could buy a luxury SUV

The Other Brian expressed his frustration, too:

I agree with Tyler 100%. I'm pretty sure the person that wrote that post would get absolutely BLASTED in the comment section for their prioritization of Stuff over experiences…

And Jane, who is usually mild-mannered, chimed in:

I would love for someone to actually have the courage to write an article about how they scrimped and went without for a big screen television! Why is that any less valid than saving for a trip to Paris? I'm sure everyone would say that it is just as valid and cite J.D.'s mantra “Do what works for you.” But let's be honest — there is a pretty obvious privileging on this site and others of certain types of ways to spend your money. Travel is one of the ones that people categorically praise.

First of all, I'm as tired of travel articles as everyone else. Yes, it's one of my pet topics, but we've featured it a lot around here lately. Time for it to take a back seat for a while. Second, I think travel gets praised a lot because people enjoy it. For years, I heard people extolling the virtues of travel, but until I tried it, I didn't really understand.

That said, Tyler, Jane, and The Other Brian have a valid point. We do talk a lot about Experiences here — but I think that's because in Real Life, so much attention is heaped upon Stuff.

Stuff isn't evil (though too much of it can certainly become a burden). Maybe it's time for a little reality check…

How to Spend Your Money

Jane is right: My gut reaction is to cite my motto: “Do what works for you.” Because that's what it's all about. If you're out of debt and meeting your savings goals, spend your surplus on whatever you want.

  • If you want a big-screen television, buy a big-screen television.
  • If you want a Range Rover, buy a Range Rover.
  • If you want a surfboard, buy a surfboard.
  • And if you want to travel, travel.

I don't care what you spend your money on, and neither should anyone else. Travel isn't inherently better than television, and I'm not arguing that it is. (For me, travel is better than television, but maybe not for Jane.)

I spend plenty of money on Stuff. In the past two years, I've bought a used car, a new bike, some nice furniture, season tickets to the Portland Timbers, and more comic books than a grown man really needs. (Trust me: If I'm buying all these comic books, I'm not about to judge you for buying a television!) I've also paid for an expensive gym membership and traveled to nine other countries.

I'm careful to avoid debt and meet my savings goals, but I spend my surplus on Experiences and Stuff. Both have value.

And Donna, who just wrote about eating lunches of cheese and crackers so she can afford to travel the U.K.? Well, Donna's willing to pay $9 for half a dozen cupcakes. Is that frugal? Of course it is! Well, maybe not frugal, but it's certainly a reasonable expense. Donna can afford it, and it makes her happy.

There's no one right way to do this. Donna splurges on cupcakes. I splurge on comic books. Maybe you spend on cable television. So what? If these are conscious decisions and we can afford it, there's nothing wrong with buying Experiences or Stuff. Or both. (After all, that's why we scrimp and save.)

Note: For another example of somebody choosing to use their money to buy Stuff instead of Experience, check out this article about a fellow who bought a boat.

What Do YOU Splurge On?

Financial writer Greg Karp recently dropped me a line. “I'm doing a column on what people splurge on,” he said. “Any thoughts?” I wrote back to share my main splurges: travel, travel gear, fitness, and computers.

I did a similar survey of personal finance bloggers almost three years ago. “What do you splurge on?” I asked. Free Money Finance spends on cycling gear. Trent at The Simple Dollar splurges on videogames. And SVB from The Digerati Life buys stuff for around the house. Most of the people I polled spend on experiences: especially food and travel.

What about you? How do you spend your money? Assuming you have some sort of surplus after saving, do you focus on Experiences or Stuff? Do any of these purchases ever make you feel guilty? Or do you see this spending as a reward for making smart financial choices? (I used to feel guilty, but now I see spending as a reward for doing the other things right.) Chime in with your comments.

And, hey — if you want to write a reader story about how you saved for a boat or a television or a Range Rover, please send it in!

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