When I started my first job out of college my mom (thankfully) had me sit down to create a budget. Staring at the reality of how much spending money I didn’t have, I immediately panicked and created a budget for each little thing I wanted to spend money on each month.
Even though I had a budget, my spending money always disappeared quickly and I could hardly remember where it went. I tried to create good habits and keep track of every dollar I spent, but I would still feel the pinch at the end of each month as I tried to make my last $20 stretch until another paycheck arrived. While I was technically being responsible and saving a portion of my income each month, I always felt deprived when I had to remind myself I couldn’t do something I loved because I didn’t have enough money.
After about a year of feeling as though I was struggling, even though I was making a decent salary, I knew something needed to change. The traditional methods of budgeting were leaving me feeling restricted and unhappy. I decided to try another way: Spend guilt free on the things that brought me the most happiness, and cut my spending on the things that didn’t matter as much. I called this my experiment in buying happiness.
Now I know that money can’t actually buy you happiness, but I decided to try this approach to my budget to see if it would not only help me to rein in my spending budget, but also help me feel happier and more satisfied with where I am able to spend my money.
After employing this technique for a few years, I can honestly say that I spend money more mindfully now and enjoy the ability to indulge in what makes me happiest. Here are the three things I did to help me spend only on what makes me happy.
Prioritize what makes you happiest.
To begin, I made a list of everything I spent money on, aside from necessities and savings: eating out, taxis, the occasional mani/pedi. It was a good exercise just to see what little indulgences I treated myself to, almost mindlessly. I then went back through this list and highlighted the things I really loved, the things that when I bought them or experienced them, I actually appreciated the moment. For me, experiences (like travel) ranked high on my list, as well as being able to go to my favorite pilates studio near my apartment.
The things that ranked lower were still things I enjoyed, but I knew I needed to cut back on in order to do more of the things I loved. That included eating out, my aggressive Uber addiction, and the extra little things that always seemed to make their way into my cart when I was shopping. This wasn’t to say I was vowing to never spend money on these things again, but they were mindless ways I was spending money, which wasn’t bringing me any real, notable happiness.
Take a look through what you spend your money on each month. What are you spending money on that you absolutely love? And what are you spending money on, perhaps mindlessly, that isn’t bringing you a ton of joy? Create your own happiness list by prioritizing your spending.
Create your new plan.
Once you know what you want to spend your money on, it’s time to create a plan to figure out how you’re going to spend money on the things that matter most to you—and cut back on the things that matter least.
I knew I wasn’t going to be able to stick to a rigid budget or never spend on the low priority items on my list again. So I decided to take a slightly more positive, less restrictive approach. As I mentioned, I love pilates. I love how I feel after each class and when I would book a morning session I would almost jump out of bed excited to go. But at $25 per class, this was not a regular luxury and I would usually only sign up for one class per week because I felt like I couldn’t justify the cost.
After adding pilates as one of the top items on my happiness list, I started looking for new ways I could squeeze in another class or two. If I could stop buying lunch every day at work and bring my own meal twice a week I could easily afford to go to another class. I tried to bring my lunch to work in the past, but it always felt like an inconvenience. Once I changed my mindset to see that bringing lunch was no longer a burden but was something that would enable me to attend one more pilates class, bringing my lunch didn’t seem like such a bad idea.
After you make your new plan to spend money on the things that make you happiest, it’s still easy to get pulled off track. The little expenditures that seem insignificant in the moment really do add up. I seemed to always spend too much on the little things that didn’t bring me much joy—buying a $6 juice after working out or hopping in a cab when it looked like it could rain.
Now before I purchase anything I try to practice mindfulness. Do I really want to buy that now or could I use that money later to buy something higher on my happiness list?
While I’m definitely not perfect when it comes to mindfully spending and there are certainly times when I spend far too much on things that are least important to me, but I’ve noticed a positive change in my spending. There’s now more wiggle room in my budget at the end of the month and when I’ve stuck to spending money on what makes me happiest, I appreciate my purchases much more.
Whether you’re happiest spending your money on experiences or a gorgeous new dress that brings you joy each time you wear it, prioritizing spending can help ensure you’re able to spend your money on what matters to you most.