The Balancing Act of Money: When to Save and When to Spend

The psychology behind money is interesting. We have all heard messages from our parents and society about money - and we still do. Maybe your parents told you things like "money doesn't grow on trees" or "what do you think I'm made of - money?" or "you have to work hard for money because it's hard to come by." On the contrary, maybe your parents were spenders - they never missed an opportunity to buy the latest and greatest stuff ... and then maybe went into debt as a result. Regardless of how you grew up, we all got messages about money.

I tend to be "cheap." In other words, you won't find me spending lavishly on many things. And I definitely am not an impulse buyer. But I do have my weaknesses for some things, as we all do. I don't know exactly how I got to be "cheap," but I know that I got messages about the importance of saving money while I was growing up. So I find myself struggling sometimes by trying to figure out when and where I should splurge - or save.

Here is a list of some things that people either spend money on - or avoid spending money on. Many of them on this list are ones that I struggle with as well. So I'm going to give you some insight as to what I think about spending money on these things.

1.    A new car

I am the kind of person who drives my cars until they die. And even then, it's difficult for me to shell out the money for a new car. I only do it when it becomes a necessity, and then I do thorough research before I make a commitment to buy one. But many people go through cars like they're going out of style. But then you always have a car payment. So which is better? Having the best-looking, newest car all the time? Or going a few years throwing your would-be car payment into savings? I guess, once again, the answer to that in an individual decision.

2.    The newest technological gadget

Okay, this is one area where I don't struggle. But I included it because I know a lot of people who fall into this category. They always need to be the first to have the newest phone, TV, or any other electronic gadget. While it's fun to get these things, how necessary is it? Does your old phone still work? Probably. But what you need to figure out is this: is it worth it to spend some unnecessary money just to be the "first" to have something? Maybe the answer is yes, and maybe no. Only you can answer that. Obviously, it's not my priority, but it is for some people and that's great if spending money on things like this makes them happy.

3.    Vacations

This is a biggie for me. As we all know, vacations are not cheap! I have two boys, and I really want to provide them some great childhood memories from vacations. But then I always think to myself, "If I spend this money on a vacation, that's money I could be putting toward their college education." So, I usually err on the side of saving. However, there are times when I do decide to spend some money on less expensive get-aways because they will be great memories.

4.    New clothes

My sisters make fun of me because I like to shop at Goodwill. But in my opinion, why would I spend $50 or $100 on a piece of clothing when I can get one just as good for $3 or $5? I can get a  nice "new" wardrobe there for $50 or less. It's just where my priorities lie. I'd rather spend my money on other things like vacations or other entertainment.

5.    Landscaping

This is another huge area of expense that I am reluctant to spend my money. But I also don't want to look like I have an abandoned house because my landscaping is terrible. Plus, the neighbors would probably kick me out of the neighborhood if it got that bad! So, what I do is hire high school kids to do some basics - weeding, mulch, and planting a few flowers. It's better than nothing, and the cost is much less.

6.    Remodeling your house

This is one I am currently going though. I built my house almost 15 years ago, so things like my kitchen are now outdated. And I have been considering doing some relatively pricey things like remodeling that and also re-vamping my artwork around the house. I tend to have a contemporary theme in my house, so I'm thinking of spending some money on some different types of pieces of art so I can change the look of my house.

7.    Entertainment

This is my weakness, and probably where I spend most of my money. I love eating out at restaurants, going to movies, concerts, or any other fun activity. And I don't have a problem with it - that is, until I get my summary of what I spent at the end of the year when my credit card company sends it to me! Just kidding. I never have regrets about spending money on fun times!

8.    Cosmetic or luxury services

Who doesn't love a good massage, facial, manicure, or pedicure? I'm sure there are probably people in the world who don't like this sort of thing, but I am not one of them. While I don't splurge on these things on a regular basis, I do treat myself sometimes because I think it's part of self-care and self-love. Plus it just feels good!

The bottom line is this: what are your priorities? Mine are different than yours, and yours is different from the next person. And that's how it should be. But I think that being a conscious spender is important. If you part with you money, at least know why you're doing it (and how much you're spending!).

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