Sometimes You Can Increase Your Discretionary Spending
If there is one personal finance mantra that everyone can agree on, it is to reduce your discretionary spending . Skip latte! Collect these lunches! Wait for the movie to hit Netflix!
However, there are times when reducing discretionary spending is not always a good idea. As with everything else in life, there is time for financial detox and there is time for increasing your restaurant budget.
Here’s when you should set aside more money for custom purchases:
When you move
Yes, we know – you won’t leave the move with a lot of extra money in your checking account. However, it’s worth setting aside a little extra money so you can explore your new area. Stop by that coffee shop, take this tutorial, or visit this local bookstore and don’t feel guilty . This is how you become part of the community.
On the community side, you’ll also want to set aside some money when you start making friends. It will be too early to try and have a budget lunch, so be prepared to meet people for a drink or tacos. If each other wants coffee or everyone in your new writing group goes to the bar after class, make sure you have a budget to go with them.
When you start a new job
While you might be tempted to pack lunch or skip happy hour, a new job isn’t the time to cut your expenses. The connections you make at work will help you both in your daily life and in the long run, so take time to get to know your coworkers, which often means spending money in restaurants, bars or cafes.
This is also a good time to invest a little extra money in your looks. First impressions matter, as does starting from scratch, so if you haven’t updated your clothes (or shoes) for a long time, it’s time to go shopping.
Also: come on, get a gym membership. At your new job, you are building a new daily routine, so why not add a new healthy habit? Bonus points if your employer helps you pay for it.
When you’re lonely recently
No, I’m not going to suggest that you start dating again immediately – although if you want, that’s great! I suggest spending a little more money on yourself: going to class, ordering a massage, getting friends to a party.
It’s time to figure out what you want out of life, and sometimes you need to spend money to do this.
When someone you love needs your help
Maybe your partner was having a bad day. Maybe my best friend got fired. Maybe one of your children has just overcome a major challenge. It’s worth spending your discretionary budget – or even exceeding it – when someone close to you needs dinner, a spa buddy, or a movie trip.
When you want to support local businesses
Yes, we know you can buy books at the library, but local bookstores also host author readings, run children’s programs, and introduce new books and recommendations to readers. It’s the same with your local bike shop or yarn shop: these are not only places to spend money, but also safe cycling activities or knitting clubs.
But you really need to spend money to keep this business going, so set aside some discretionary income for your favorite local stores and restaurants. This type of spending is rarely “wasted money”; yes, you could cook your own food at home, but it’s also important to contribute to your community. Ideally, this is something you can fit into your discretionary budget year round.
If you really want to cut down on your spending — and I’m always there for you because I’m always looking for ways to save more money — try to cut back on the purchases you make as a matter of habit or convenience. (There’s a difference between going out to lunch with your coworkers and running out to a restaurant on your own because you didn’t have food in the fridge for lunch.)
Keep purchases that have a purpose – those that connect you to yourself, your friends and family, or your community – and if that means spending a little more money on spending that isn’t recommended on personal finance sites, remember about the value you get from those expenses and figure out how to make them work for you.