8 ways to spend your money without feeling any guilt – The Economic Times

Clipped from: https://economictimes.indiatimes.com/wealth/spend/8-ways-to-spend-your-money-without-feeling-any-guilt/articleshow/88356712.cmsSynopsis

Many of us have made it a virtue to be frugal penny counters who do not enjoy spending. Inability to spend even when there is adequate wealth, and to use that wealth when there is an abundance of choice is a common syndrome. What can we do to get ourselves out of this trap?

That’s Rs 200 per kg, said the fruit vendor. My sister in law let out a sigh. Things have become so expensive, she said. But you love the fruit, remarked her son, just buy it. Reluctantly she bought a kilo of custard apple, lamenting that there were only five fruits for that price. So many of us needlessly fret when we have to spend. It is like an incurable pathological condition.

It is not as if Rs 200 matters to her. She can so easily afford to buy more. It is just that she does not have the heart to count out the money and see it gone in a few seconds. That act of spending has historically made her feel regret, an emotion most people are uncomfortable with. She is unable to modify that conditioning, brought up during the years of limited income and scarcity. Many years of plenty have not altered that.

The problem is also social conditioning. Many of us have made it a virtue to be frugal penny counters who do not enjoy spending. To complain when one has to spend, to bargain while buying, to postpone buying and spending, to make do with less even if one desires more, are all virtuous behaviours for many of us. We are proud of these characteristics that we share with our peers. We also believe that it builds emotional intelligence and character. So much so, that nostalgic conversations about the bygone years of poverty and scarcity are so commonly heard. Refusing to acknowledge that none of us will ever go back to those years that we so fondly romanticise, we celebrate those memories. Inability to spend even when there is adequate wealth, and to use that wealth when there is an abundance of choice is a common syndrome. What can we do to get ourselves out of this trap?

First, the mind manages allocations well, even if money is a single indivisible pool. Identify and earmark extras that are easier to spend as compared to spending the corpus or main income. Spending the dividend income on an annual holiday; using the rental income to buy some clothes; or allocating the income from the ad hoc consulting assignment to buy something one coveted for long, are all plays on the mental accounting habit. What is not seen as drawing from accumulated wealth is relatively easier to spend.

Second, appreciating the difference between being frugal and being stingy is critical. While constantly criticising the young for being wasteful, the elder generation likes to make an example of its frugality. It is wonderful to be minimalistic. But denying one’s comfort and the simplest of desires is likely to be seen as a persecution syndrome by the young. If travelling by bus offers great joys and views, make sure you talk about that experience. Don’t make that decision after checking the air-conditioned ride’s price online. If your choices are driven purely by the price of something, you may be miserly not minimalistic.

Third, accept that you are as important and precious as the others in the family. There is no need to undermine your needs and comforts, even as you go to great lengths for everyone else. Parents who eat leftovers at the table without ordering food for themselves, are pitied not respected. When you don’t make an explicit choice but enthusiastically goad others to buy stuff at the store, eagerly waiting to dutifully pay the bill, you make everyone else uncomfortable. Learn to love yourself and treat yourself as you would treat others.

Fourth, do not make it known that you are compromising. It makes everyone else cringe. You don’t have to grab the best on offer and be glaringly selfish. But when the discussion about a spend comes up, let your preference be known. If you want to see the museum, instead of hanging out at the amusement park, don’t compromise citing the entrance fees. Make your choice and let others make theirs. Every discussion need not be acrimonious if preferences are known. Make it easier for yourself and for others to spend on what matters to you.

Fifth, don’t throw a tantrum. Each one of us has a line that we mentally draw, about how generous we can be. It is a personal watermark our hearts know. Do not strive to be better than that limit. Anger, resentment, tantrum and discord will ensue. If someone else is spending, be gracious. Do not make it tough on them. If you are spending, stay within your line of generosity. You don’t have to make an announcement. But you need to be honest with who you are. Keep in mind that despite best efforts, the real you will reveal itself for everyone to see, as you slip up subconsciously.

Sixth, don’t obsess about leaving a fortune for your children. They may not need it. Allocate a portion of your wealth for yourself. Make sure you choose comfort for yourself, and be willing to use your wealth for your needs and desires. Do not seek your children’s approval to spend your wealth. It is not theirs yet, and do not encourage them to act entitled. Many worry about what others will think of elders that spend and indulge, as if age has got anything to do with it. Your wealth is primarily yours. Everyone else is a residual claimant.

Seventh, every spend need not result in a physical outcome and a product. Life is rich by its experiences. If you must have a car to be able to drive out to watch the sun and the moon and stars, prioritise that spend for the everyday joy it brings. If having a full-time help saves you the pain and burden of household chores, spend to free up time on activities that you enjoy. Make your choices based on honestly evaluating how the experience feels for you. That matters most.

Eighth, every spend need not be on yourself. If there are poorer sections of people that come into your everyday life, extend yourself to bring joys into their lives. If you have more wealth than you can spend, you owe it to society to share. Begin small and enjoy the joys of quiet giving. Give without expectation. When you see the huge difference your wealth can make, you will find it changing your attitude towards money, life and people.

You may have more than you need, and being able to honestly evaluate it is in your hands. Make it a better life for yourself and people around you. If your wealth doesn’t result in a sense of security and confidence, what use is that painful accumulation?

(The writer is Chairperson, Centre for Investment Education and Learning.)

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