4 Tips to Overcome the Fear of Spending So You Can Enjoy Your Cash

by Sophia Bera on March 11, 2015

In our quest to save money for emergencies, retirement, and future goals, it’s easy to develop a fear of spending money. But that’s not the right money mindset — or a healthy one — to maintain.

As long as you can cover the basics, like having an emergency fund and saving consistently for retirement, you are allowed to spend money on yourself sometimes. The key is to align your spending with what you value. You can cut back on what you don’t find as important, to make room for what you prioritize.

Ultimately, money is a tool and you can use your finances to do things and enjoy life. If you’re afraid to spend money because you’re worried about the “what ifs,” take a step back and take these actions right now.

Identify Your Values

Before thinking about all the things you could spend your money on and panicking because you’re concerned about the cost, alleviate your stress by evaluating your finances. Create a comprehensive financial plan that outlines how much you bring in, your expenses, your savings, and what you donate or give to charity.

Once you have this outlined, it’s time to identify your values. What makes you the happiest? Prioritize things you would like to do in short-, medium- and long-term goals.

A general rule of thumb is to choose experiences over things. Material possessions tend to lose their luster shortly after you purchase them, whereas memories of a fun trip with family or friends last for years.

By creating a comprehensive financial plan and incorporating your values, you will successfully use your money as the tool it is.

Prioritize Your Spending

You must prioritize your spending so that you can use your discretionary income fully. After all, your goal is to enjoy your money now and long-term, and not fritter your money away on things that won’t prove useful 2 to 5 years from now.

For example, if you prioritize spending money on a vacation with your oldest friends, consider what a happy hour out with coworkers, or a weekend, spontaneous beach vacation would mean to your finances. If it keeps you from reaching your goal sooner, skip or save your money.

Conversely, if attending happy hours with coworkers and friends is important to you because of a larger goal (a promotion, or a good recommendation for your dream job), then allow yourself to spend money on events that will bring you closer to your goal.

See why you need to identify your values first? It’s hard to prioritize how you use your money if you’re not sure of what’s most important to you.

Diversify Your Income

Sometimes thinking about spending money can be overwhelming because you doubt the stability of your current income or job. If you work odd hours, or depend on clients for a consistent paycheck, it can be hard to justify spending money on things you consider “frivolous.”

While there’s a finite amount of money you can save to both pay your bills and fund your priorities, your ability to earn more money is theoretically infinite. Seriously! There’s no limit to how much you can earn. Alleviate fears of scarcity or instability by trying your hand at earning some extra money on your own, on the side of your day job.

You’ll not only have more money to put towards your goals — or toward just fun purchases — but you’ll also diversify your income. If you were to lose your main source of income, you would still have another income stream to help you get through a tough time.

Diversifying your income could involve doing small jobs, like going through your old clothes and selling them on eBay or at a consignment store. If you have more time, find a consistent side job, whether that’s freelance writing or working odd jobs from TaskRabbit.

By allocating some of your free time to picking up extra work, and extra funds, you’ll alleviate concerns about not having enough money for your goals. In addition, you may find a steady stream of extra work that can contribute to your long-term goals as well.

Is It All About the Money?

If you can’t think of anything you’d rather spend your money on, maybe you really are balancing everything: retirement, emergencies, and enjoyment. If that describes you, yet you still don’t feel completely fulfilled, then maybe it’s not all about the money.

Some people equate spending money with happiness, but that’s not always the case. If you work a lot, make a good amount of money to do with it what you please, you may want to consider taking a step back and spending some of your time.

Think about a cause that means a lot to you: is it ending domestic violence, fundraising for animal shelters, or advocating for children’s issues? Choose the cause you feel most passionate about, and spend some of your time helping out.

It can be hard to get started sometimes, so do a little research and see where your time would be best spent. Most animal shelters could always use people to walk dogs or clean up after the animals, whereas other causes would rather you help them fundraise or create weekend food baskets.

Offer your skills to your cause, and be open to whatever they want you to do. Your time is money, and giving back in this way can have innumerable benefits for both you and your cause.

There is no reason to deny yourself happiness because you’re paralyzed by money fears. As long as you are not up to your eyeballs in debt, you have the ability to free yourself from your fears and allow yourself a little fun here and there. The key is to do it responsibly by creating a comprehensive financial picture and identifying what truly makes you happy.

Sometimes those priorities cost very little, like visiting with local family members. However, sometimes you have to spend more in order to realize all of your goals. By determining what is important to you and working your way to those goals, you can enjoy life and take care of your future at the same time.

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