You’ve finally skimped and saved your way to financial security. Now it’s time to enjoy your wealth by splurging on all of those luxuries you denied yourself in the past.
While you’ve earned the right to treat yourself, it’s just as important now to avoid wasteful spending as it was before (albeit for different reasons). Being intentional about your money will ensure that every dollar is spent on something that adds real value to your life.
1. Repairing Instead of Replacing Your Things
When money is tight, you might try to get that faulty appliance or car fixed out of necessity. As your income grows, though, it’s tempting to just skip the hassle of either fixing it yourself or finding a reliable repair person for the job. After all, if you can afford to buy new, why not go for the upgrade?2. Buying the Cheaper Version When It Makes Sense
If you’ve got no complaints about the generic ibuprofen or store brand pasta you were buying to keep your monthly budget under control, stick with them. There’s no reason to pay more for name brands or fancier versions just because you have the money to do so.3. Avoiding Lifestyle Creep
You don’t need a Maserati just because you have Maserati money now. If you’re not a car enthusiast, there’s no reason to ever buy a luxury car. Stick with a quality option that gets you where you need to go.
The same logic applies to everything you spend money on, but especially ones that are an ongoing expense, like your house and monthly bills. It’s fine to splurge on the things you care about now that you’ve got more room in your budget. But it’s important to be intentional about those splurges.
- Don’t buy more house than you need, even if you can afford it. If you’re looking to upsize because your current home is just too cramped, think carefully about how much extra space you need and how you would use it. Do you actually need more square footage or do you maybe just need more storage to declutter the space you have? Do you really need a separate guest room and home office or can those be combined into one room? Remember that a bigger house also means more maintenance and more cleaning. Even if money is no object, the time and energy you’d need to put into the home still are.
- Don’t upgrade your phone every year if you wouldn’t have before. The same applies to your other gadgets and tools. Doing so might not be a budget-killer anymore, but it’s still wasteful and mostly unnecessary. If you’re still doing fine with the tech you have, spend that upgrade money on something that would actually bring you joy.
- Don’t accumulate subscriptions just because “it’s only $10 per month.” Again, these little monthly expenses might not drive you to bankruptcy, but it’s good to maintain a mindset of avoiding waste. They call it lifestyle creep because it has a way of creeping up on you. Being vigilant, even about little things like this, can help you stay sharp and ensure every dollar is still being spent with intention.
4. Knowing Where Every Dollar Is Going
Budgeting isn’t just for people who need to make a limited income stretch as far as possible. It’s the foundation of any financial plan, regardless of how much money you’re working with each month.Keeping track of where your money is going and assigning a job to each dollar coming in will help you cut waste out of your monthly budget and be more intentional with how you spend. That way, your wealth can actually bring you the joy and sense of security that you worked so hard for.
Of course, as your wealth grows, your definition of waste may change. Where eating out multiple times each week may have seemed wasteful when money was tight, it could be the best way to enjoy your wealth if you’re a foodie that loves trying out new restaurants.
5. Increasing Your Savings in Step With Your Spending
As your income and cost of living increase, remember to readjust your emergency fund, too.The rule of thumb is to keep three to six months’ worth of expenses saved. If the last time you calculated that number was before your promotion or raise, it’s time to reevaluate and increase your target amount.
6. Turning Off the Lights and Other Energy Efficient Habits Around the Home
Some of those frugal habits that your family might find annoying like watching the thermostat like a hawk and timing your showers are still good practice even when you can foot the higher utility bills. While you may be able to relax your standards a bit now, there’s no reason to waste water or electricity if you don’t have to.This is just as much about being mindful of your spending as it is about being eco-friendly. The less resources you use, the less strain you put on public water and energy sources.
7. Taking Advantage of Sales
There’s no law that says a good BOGO deal is only for the people who actually need the savings. If your favorite ice cream or preferred laundry detergent is on sale, stock up. As always, the rule of thumb is that it’s only a deal if it’s something you would have bought anyway. And you shouldn’t stock up beyond what you can use before the expiration date.Smart Spending Habits Transcend Tax Brackets
As your net worth grows, it’s nice to be able to relax a bit and know that you can afford the lifestyle you’ve always dreamed about. But, just because you don’t have to be frugal out of necessity doesn’t mean you shouldn’t care about wasteful spending.By maintaining frugal habits like the ones above even when you don’t technically need to, you can ensure that the wealth you’ve built up is actually going toward the things you care about and that lifestyle creep won’t wipe out your assets faster than you anticipated.
