Personal Finance Tips on When to Splurge





"We are what we repeatedly do, excellence then is not an act, but a habit." -- Aristotle

"Fun is good." -- Dr. Seuss

You've worked hard to develop sound budgeting habits, but what fun is life without a little splurge? Just because you're working to pay off debt, build a healthy retirement, and pay every bill on time, that doesn't mean it's unwise to do something nice for yourself once in a while.

A healthy budget makes room for and incorporates a little excess. As long as it doesn't get out of hand, it can even help you stay on track. Complete denial of something you want, just because it's unnecessary, makes life all about the finish line, and nothing about the race leading up to it.

Start now to make room for some of the nicer things in life, and they won't have to pinch at all.

A Little Excess Can Keep You On Track

Discipline is important. It's what keeps you on the path to financial security. But when every minute of every year includes all discipline and no time for something unnecessary, life isn't any fun at all. It's like you're preparing for a life that hasn't started yet. So when will it start?

According to NBC News financial planner, Lazetta Braxton, recommends a monthly splurge account. Braxton says when people feel tied down to a strict budget, they're less likely to follow it. Allowing for a little excess can help make sticking to a budget easier.



Decide What Equals "Splurge" to You

Some people are perfectly fine never eating in a restaurant or going to a movie, but they really love new technology. Others couldn't care less about a gadget, but would treasure a night out on the town once in a while without feeling guilty about it the next day.

What equals excess to one might not be the same to another, so only you can decide what you're goals are. Maybe you need a chance once a month for something fun, or maybe your goal is a bigger splurge, but less often. What you love, and how often you want it, will determine how much money you need to set aside.

Make Room for Fun in Your Budget

Emergency, retirement, and other savings goals are important, and excesses aren't meant to equal their priority. But if every dime outside your monthly expenses goes into one of these accounts, with nothing left over for something fun, then you might need to reevaluate how much you're saving where, and why.

If college for the kids is still 15 years into the future, you can probably afford to direct a few dollars each month away from the college fund and into a fun account for yourself. Don't worry, you're not doing the kids a disservice if there are still many years left to save.

Wherever you're saving like mad to meet a goal, consider easing up just a bit. A few dollars here and a few more there can add up to something you've always wanted.

Mint.com can help you meet any financial goal, even one that seems frivolous at face value. Using Mint's budgeting software, you can experiment with your budget to see how new choices, such as a splurge account, would affect your finances on the whole.

Using Mint's mobile app, you can even keep track of your budget while you're out having fun.

Sign up for your free account today, and learn about the many ways Mint.com helps you manage your personal finances simply, easily, and in less time than ever before.


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