Spend How You Want As Long As You Meet Your Goals

You can have anything you want, but you can’t have everything you want.

Perhaps you have heard this before. It can be applied to many different aspects of life. Today, as usual, I’m using it in relation to personal finance. I am a firm believer in balance. All work and no play makes for a sad life. To me, not ALL money needs to be spent in the wisest way possible. However, goals need to be established, whether formally or informally, in order to determine where at least some of your money needs to go. After you’ve figured out your financial goals, you should have a budget for fun money. In other words, spend how you want as long as you meet your goals.

To some, this may seem extremely straight forward, especially if you already do this. For the rest of you, I’d like to elaborate. When I say spend how you want as long as you are meeting your goals, I do not mean you should go and buy yourself everything your heart desires once you meet a goal.

Meet Your Monthly Goals

First of all, it’s great to think of goals at least in monthly terms, as that is often how finances work, such as rent, mortgage, cable, interest, debt payments, utilities, credit card bills, etc. Everyone’s number one goal should be paying all bills on time.

Aside from that, different people have different goals. For example, I like to try to max out my IRA contribution each year, so each month I set up an automatic transfer to my IRA to help me meet that goal. I also have a savings account that I put money to each month that goes towards my semi-annual or annual expenses, such as property and school taxes, home insurance and auto insurance, as well. I always ensure all my money goes to meeting these various goals first before thinking about how else I will spend money.

Set Goals for Excess Money

Once your goals are established and met, you may have money leftover and be wondering what to do with it. Now before considering spending it, make sure all of your goals are fully established and being met. What I mean is, maybe you only made the minimum payment on your debt, but realistically you would love to pay down your debt sooner rather than later. Make this a goal by allotting X% or $X extra each month towards principal to help you pay that debt down sooner.

Another idea is maybe you want to have more money in investments by the end of the year. If that is the case, determine how much you realistically would like to increase your investments by before the end of the year and work backwards to figure out how much you should contribute monthly to make that happen. Whatever the case is, we all have some ideas about what we would like our finances to look like, so think about those, make them a goal and determine the logistics of how to make it happen.

Spend How You’d Like

Now, after paying all your bills and allotting money towards various other personal finance goals, if you are left with any other money, spend it how you would like. I, for one, have lots of passions and desires and wants, so it can sometimes be hard for me to narrow down what I want to spend money on; however, food, fashion and vacation seem to be the three most prevailing for me.

Once I have put money towards all my regular bills and set aside money for my various goals, I then use the rest to spend on the things that make me happy. I buy myself new outfits or shoes or go out to eat with my husband and/or friends each month, completely guilt-free because I have a plan established for meeting my goals. I know I need to spend money on things that bring me temporary happiness to help keep me sane. I also know there is a limit to how much I can spend. My piece of advice here goes back to the opening line of the post.

You can have anything you want, but you can’t have everything you want.

Just because I’ve met my personal finance goals for the month, doesn’t mean I want to work towards a path of creating new financial problems for myself. Specifically, what I mean is that you should never spend more than you have.

Sure, I’ll buy myself an outfit, but I won’t splurge on expensive items every month or charge things to my credit card unless I can pay it off as soon as the bill comes due. So often we are tempted to do this because it’s insanely simple to just swipe a piece of plastic and it’s so easy to justify things saying “I deserve this,” even when you can’t truly afford it. You cannot afford an item if you can’t pay it off with cash when your bill comes due or if your goals are suffering because of it. Keep this in mind and you will be able to create a happy-medium and balance both personal finance and treating yourself.


What do you like to spend your money on once your goals are met?

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