Buzz
Many people believe personal finance revolves around denying yourself and avoiding the urge to spend. While that’s part of it, there’s also a strong argument for investing in things you truly love. Financial advisor Carl Richards makes this case in The New York Times.
Richards offers an opinion you won’t often hear from financial experts: it’s okay to buy things you truly love. In fact, it might even be a financially sound decision to do so.
For instance, I once had a debate with a reader about the myth of buying a home as an investment. The reader eventually agreed that homes are overrated as investments, but pointed out that I hadn’t considered the emotional aspect: the love and pride someone feels for their home. This is a completely valid point. If you’re financially stable and not spending beyond your means, why not buy something simply because it brings you joy?
We often feel compelled to justify these purchases. We call them guilty pleasures or we convince ourselves they’re investments. But it’s perfectly fine to splurge on something you love, and Richards shares a personal story. He recounts how he once yearned for a high-priced bike but hesitated because of its cost. For weeks, he searched for a similar one and tried to talk himself out of it. He writes:
After enduring the grueling process of shopping around, comparing prices, and considering models I wasn’t particularly interested in, I made the decision. Following weeks of buyer’s remorse that felt more like dread, I realized something that might sound absurd. Purchasing this ridiculously expensive bike turned out to be one of the smartest financial choices I’ve ever made... It was a brilliant, logical, and sound financial decision. And I know this contradicts everything you’ve heard from personal finance experts who are always advising you to save, cut back on expenses, and buy cheaper. What I’m saying is that this narrow perspective needs to be reconsidered.
To be fair, there’s a reason why experts often stress frugality: because there are likely more people who overspend than those who oversave. However, that doesn’t diminish Richards’ point that it’s not inherently wrong to buy expensive things you love. In fact, it can be completely fine, and at times, it actually makes more financial sense. If you love an item, you’re more likely to hold onto it. And if you keep it, you’re more likely to use it and keep it for years to come.
Money is simply a tool to help you achieve what you want in life, whether it's financial security, a home, or a new bike. Frugality is another tool. It can help you save up more money to spend on the things you desire. The key is using both tools in a way that serves your current and future needs most effectively.
To learn more about Richards' perspective on this subject, click the link below.
Photo by bark.
