In Defense of the Fun Budget

in-defence-of-the-fun-budget

There’s this thing that happens when people find out I blog about money.

It goes something like this.

“Oh my god, I’m so bad at money – I spend so much on _______.”

That blank can be a lot of things, from craft beer to restaurants to clothes to a dog (ahem, hi. Me and my bonkers-expensive dog will just stay quiet on this one.) No matter what that blank is, there’s one constant: it is always, invariably, something that person really likes having in their life.

Maybe even loves.

So they spend money on it, and then they hear personal finance blog and the Guilt Monster pops up with a reminder that

“Oh my god, you spent money on a thing you like. That’s bad, and you should feel bad about it.”

And all I want to do is punch that Guilt Monster right in the face. Because, shocking personal finance truth:

You can be great with money and still spend money on things that make you happy.

In fact, if you’re not spending anything at all on things that make you happy, I’d argue that you aren’t doing money right in the first place.

Here’s exactly how you can keep spending money on things you love, and be a money rockstar at the same time: set a fun budget. Put aside a specific amount of money in your monthly plan, every month, that you get to spend on whatever you want, guilt-free.

Man, that was easy, eh?

If you want a quick guideline on how much you should be putting into your fun budget every month, check out the One-Minute Budget – all you need to do is put in the number on your paycheque, and it’ll give you a rough idea of how much fun money you can spend every month. (Seriously, it’s that easy.)

It’s that easy, and it’s also that worth it, because here’s just some of the benefits I’ve experienced now that I have a fun budget baked into my monthly spending.

You Know How Much You Can Spend On _______ Every Month

Whatever your blank is, you’ve now got a clear guideline on how much you can spend on it.

Maybe it’s computers, and your budget will allow for a new game every month, but not necessarily a new computer. Maybe it’s shoes, and you can buy a nice new pair of shoes once a month, but not a new pair of Louboutins (because omg that’s not a pair of shoes, it’s a mortgage payment.)

It doesn’t matter what it is, because in every single category of things that people like, there are really bonkers expensive options, and then there are options that you can enjoy every month. Your fun budget helps you figure out which ones are which.

You Can Find Ways To Enjoy Things Strategically

I love books. Like, l-o-v-e them. Do I still read them? All the time. Do I still budget $50 a month to buy new books from Amazon? Nope.

I realized that my enjoyment of books is exactly the same whether I own them or not, and that the library is a readily available source of free books. That one decision gives me an extra $50 every month to spend on date night or new clothes or patio beers with friends – all things that are much harder to get for free.

I might be cute, but I’m not get-drinks-for-free cute.

You Get a Clear Picture of Your Priorities

When you have a set amount of fun money, yes, you will have to make some choices during the month if you’re going to stay within that budget. You can have the restaurant meals, guilt-free, but maybe you can’t also have the subscription box or the stack of new books or the mini-vacation.

As you make those decisions, you’ll be more and more aware of how much you’re really enjoying the things you’re buying, if only because you know you could be buying something else with the money. You can’t help but notice which types of spending add the most happiness to your life when you’re aware of it, and you’ll start to prioritize those things.

In that way, literally, a fun budget will increase your overall happiness.

You Can Banish the Guilt Monster

If you’re on my email list, you’ve heard this already, but I bought An Expensive Thing last week: a day planner that retails for $75. Before tax. (That’s it in the post photo – isn’t it fancy?!)

That’s crazy, right? I’m a personal finance blogger and I spent $75 + tax on something I 100% do not need. But – and this is the beauty of the fun budget – I wanted it.

I had been using that day planner’s free printables to keep myself organized, and they had a huge impact on how I thought about my day and how productive I’ve been. So I wanted to buy the full version when it came out – and I did.

Guilt-free, because I scaled a little bit back on other fun spending this month.

That’s the real key to balancing “being awesome at money” and “spending on the things you love.”

When you set a fun budget as part of your monthly spending, you’re giving yourself permission to do whatever you want with that money – but only that money. You’re balancing your wants with your needs and your long term goals, because you’re taking care of those in other parts of your budget.

This strategy is also the only way to consistently hit your goals month after month, by the way, because trying to cut everything fun out of your life is a recipe for budget disaster.

It’d be like telling yourself you can never eat carbs again. You might do really well for two months, but month three? Let’s just say you might find yourself staring down the biggest bowl of pasta anyone’s ever seen.

I speak from personal experience here.

So seriously, friends: please give yourself a fun budget, and enjoy the hell out of every dollar in it. Stop feeling so guilty for spending that makes your life great. If it’s not compromising your money goals and your ability to take care of your needs, it’s actually one of the best things you can do with your money.

Do you set aside a specific amount of guilt-free spending money every month? Have you experienced any of the same benefits I have because of it – or additional ones I forgot to include? Let me know in the comments!

Desirae is on a mission to demystify and un-boring financial info for millennials, so that we can all save more money, spend on stuff that matters to us, and still have a latte or two along the way. Money is literally why we can have nice things, and Desirae is committed to helping make sure you know just enough to make the right calls for you. (She’s also committed to her expensive dog, her side hustle, and her retirement fund.)

51 Comments on “In Defense of the Fun Budget”

  1. TidyTraveler

    If you’re saving half of your salary you’re definitely allowed to splurge, even if on something you don’t actually need.

    Although, I must confess, I struggle mightily at this point with ‘superficial’ purchases, even if I really want it. My wife and I are saving 70% of our salary, maxing out every retirement vehicle under the sun, yet something as simple as a book I may want sends me into a philosophical reverie akin to purchasing a home. It’s a bit ridiculous at this point. LOL

    I find myself relaxing a bit as the savings grow, but still, one must ease on oneself once in a while. 🙂

    Thanks Des and keep up the great habits!

    1. Desirae

      Hahaha totally – if you ever need a gentle “You still save 70% of your income, you’re allowed to buy the book!” remind, just hit me up! Happy to return the kind words about my splurging tendencies this month!

  2. Alyssa

    “I might be cute, but I’m not get-drinks-for-free cute.”

    OH PLEASE.

    Anyways, I totally agree that we should budget to save on fun things or our hobbies. Otherwise, whats the point of making all this money? I personally am going through a hard time finding a balance between saving and spending. After going cold-turkey off buying anything new (makeup especially) I now refuse. But it also makes me sad, because sometimes I like to spoil myself. I think it can be a challenge even if you are good with your money! Maybe on the opposite end of the spectrum though.

    1. Desirae

      I mean, Alyssa, my boyfriend is like right there most of the time. I can’t just get those drinks for free the usual way.

      Also, can we just talk about how downright luxurious this sounds? “Otherwise, whats the point of making all this money?” I freaking love it, because yes – we are successful ladies who do work and get paid in all this money. And that is awesome, and high fives all around. But you’re right that it’s hard to go from cold turkey to moderate, normal spending, and not BUY ALL THE THINGS. I learn this lesson every time I go shopping to buy “just one pair of shorts.” (But then nothing fits me because I’m awkwardly tall, so that makes it easy again.)

  3. Latoya @ Life and a Budget

    Yes, Desirae! You are speaking the truth and this is one important piece of the puzzle that I find incredibly important for someone who is interested in getting their finances in order. I get the same response as you when I tell folks I write about money and advocate for teaching kids about money. Their guilt usually comes because they aren’t doing the basic things to make sure their finances are tight, like paying the bills. It’s okay to have the Michael Kors as long as your bills are paid and you actually have money to put in your new bag.

    1. Desirae

      Yesssss! That is EXACTLY it – Latoya, we totally get each other. I think it is so wonderful that you bring the kids into it too – I have to admit that’s one area that I have no experience in since my babysitting days, but it’s so important! My mom was always so open with me about money and I think it was crucial in terms of letting things sink in over the long term and actually knowing them as an adult (like, as soon as you get a job, you start saving, haha!)

  4. Michelle

    All of this is so true. Not giving yourself any wiggle-room to have fun is what usually kills your budget in the end. I usually give myself $40 a month which still lets me go to the movies with family or out with friends.

    Great insights Des, keep it up!

  5. Rue

    You are totally get-drinks-for-free cute pft. Own it.
    I think the most important thing with the fun budget is keeping it flexible, but manageable. Or working it into your budget in other ways that work for you.
    I have my EF and then separate savings accounts fro gifts/travel etc, but once I pad those up, my goal is to have a separate account for frivolous wants that come up every now and then. Because I could totally justify 75+ tax on a journal 😛

    1. Desirae

      Oh, you! Thanks Rue!

      And omg it’s so. pretty. I literally brought it to work today and did a little show and tell because my coworkers love me enough to put up with that, haha. Also, I lump my gifts + travel savings into one category / account too! (Which maybe you don’t do, but you listed them like you did, so I’m going to go with it. It just makes sense to me, especially because I’m entering the Summer Of The Destination Wedding, so the money is basically for both in every case anyways.)

      1. Rue

        That makes sense for destination weddings to group travel/gift together.
        Not to burst your bubble, but I have separate accounts, for travel, gift, car, EF and tfsa. Reaaally considering a treat yo self account too lol, but that might be a bit much.

  6. Ms. Steward

    This is the most contentious budget line for Mr. Steward and I, largely because we disagree on the monthly amount that should be allotted for it. I would have fewer problems if we were saving half of our income, but we are certainly not. For that reason, it’s a really unclear zone of how much should really be “guilt-free.” I’ve resorted to guilt-laundering some of my (what I find to be) crazy amount of guilt money by sponsoring a child in another country.

    1. Desirae

      Ok, that is by far the sweetest thing I’ve ever heard. Guilt-laundering your guilt-money – I absolutely adore that, and you’re doing a really nice thing for the world and that child in particular! With the side benefit of feeling less guilt, haha. I did that with part of my tax return, because it felt oddly extravagant to be putting this huge lump sum into my personal savings and not sharing any of it when some charities (ok, animal rescues) were in huge need of help. So I get it 🙂

  7. The Personal Economist

    Totally agree, no point in starving yourself. My only caveat is to spend it on things that you actually value, otherwise it disappears in take away coffees (unless you value them highly). Fun – taking my kids to SeaWorld. The screams on the roller coaster was worth the price of entry. It was their first time on a proper roller coaster and they didn’t know they were in for. Ha ha, usually I’m such a nice mum.

    1. Desirae

      Lmao surprise roller coaster! I am dying just picturing that in my head, I can totally see how it was worth the money!

      And I couldn’t agree more, which is why I’m always so adamant/preachy about tracking your spending! If you have to see that oh, I *had* $150 to spend on myself and I could have had all this great stuff, but instead I just had…. coffees? It’s a good wakeup call unless coffees really are the thing you value most! (I do have a friend like that, but he’s an anomaly.) There’s just so many opportunities to spend on things that make your life great – might as well take advantage of them!

  8. Suzewannabe

    Mad Money! Yes, you need to budget for it, otherwise you will go nuts and lose traction. Before were were out of debt, we spent 4%, or 2% each of the monthly budget on whatever.

    Now that we owe nothing, we spend 12% or 6% each and it feels luxurious. No questions asked. No guilt. It’s already agreed-upon.

    One thing we still haven’t clarified- does lingerie go in “clothes” or “entertainment”?

    😉

  9. Sabbaticalia

    You better believe I use this strategy! It’s how my wife and I can stay on the same page with our spending. As long as we each have something we can individually focus on our wants, knowing it cannot affect the household’s progress, most of our money disagreements have just gone away.

    I’ve taken it one step further. I have dedicated portfolios set up to generate the passive income for our separate “discretionary” funds, which I track alongside the main portfolio which will generate our FI living expenses. This way, it’s clear how much we can ramp up the discretionary spending as we progress, knowing we’ll continue to have food, clothing, and shelter no matter what we put that month’s allotment to.

    1. Desirae

      That is SO. AWESOME.

      Not only is that totally the system we’re thinking of using if it ever gets to the fully-merged finances stage, I think it is SO smart to have planned for the discretionary spending on your path to FI! Because seriously, if I were FI/RE, you would need to pry my gym membership from my cold dead hands. My ideal day would have me there like two hours a day, so it would have to be part of the budget. No matter what you both enjoy spending money on, I love that you’ve planned to cover it when you hit FI – SO smart! Thank you for sharing that!

  10. Brittney @ Britt & the Benjamins

    Agree, agree, agree. You create a budget so that you can decide what takes priority – if you love drinks on a Friday night, you may allocate more to that and less to shopping. It’s all about balancing the scales and figuring out where to splurge and where to save.

    1. Desirae

      YESSSS exactly! I love the “Balancing the scales” image because it’s true – it’s all about balance. You can’t have ALL the splurges unless you make like… a zillion dollars, and even then I’m sure you can’t have the blue yacht AND the pink yacht. Thanks Britt! (Brittney? Britt? Do you prefer one or the other? I am so awkward with nicknames, obviously.)

  11. J

    This! I tried that saving whatever I can while giving up everything else last year and I ended up being miserable. And tired. I had to stop and ask myself “but what’s the point?!” So this year, I decided to have funds for other spending and I couldn’t be happier. I know I’m saving for my future while still living a good and fun life. It’s all about balance, isnt’t it? Great post Des!

    1. Desirae

      Thank you so much J! And yes – there is absolutely no point in cutting out ALL the fun while saving! Some fun, sure, and prioritizing the BEST fun, of course. But everyone needs fun!

  12. Our Next Life

    Every. Single. Word.

    YES. I’m such a huge believer in all of this, but none of us can abstain for all fun things all the time, nor should we want to! What is the point of working hard and trying to earn money if we don’t spend some of it on things we enjoy? As long as we aren’t piling up debt or blowing the budget, then it’s all good. It’s taken different forms for us over time. When we first combined our finances, we gave each of ourselves an allowance each month. Then over time we realized we didn’t need those and we started mentally preparing for key purchases (let’s be honest, I’m talking about skis) and trips (um, yeah, ski trips). Now it’s such a matter of habit that we don’t even really budget for this stuff, we just know about what we’ll spend each year. But YES, even with a very high savings rate and total focus on a big goal (ahem), you can still spend money on fun!

    1. Desirae

      Exactly! If I told both of you you couldn’t buy lift passes for the next year, because saving, I feel like our friendship would not last long, lol. And also, where’s the fun in that?! I love that even though you guys are basically up there in my list of best savers I know, you make room for the things you really value. (Also, so cool to hear that the allowance thing morphed over time! The Boyfriend and I talk about that as the likely approach we’ll take if we merge finances and it’s cool to hear that it can evolve over time.)

  13. Mervi Emilia

    I so agree with “because trying to cut everything fun out of your life is a recipe for budget disaster”. I live currently with a strict budget. However I do try to have always at least a very small budget for fun. Without fun, what’s the point of anything? Good post, good points!

    1. Desirae

      Thank you so much! And yes – even when you’re really being careful to stick within a budget, it’s super important to give yourself at least a little bit of room for fun 🙂

  14. Andrew @ DebtFreedomJourney

    It’s like a cheat day when you’re on a diet. As long as you plan out what that entails you prevent yourself from overdoing it. The same is true of the fun budget. You have to have one, but you need to make sure it’s manageable and not too big a ratio to your income or whatever your financial goals are.

    Nice post, really well thought out and very detailed. I’ve added your blog to my daily reads list!

    1. Desirae

      Exactly! I love the cheat day analogy – it’s the cheat part of your budget! And thank you so much Andrew – on my way over to creep your blog right now!

  15. Dividendsdownunder

    Totally right 🙂 What is the point of saving all of this money if we’re never going to spend it on what makes us (frugally) happy? At the moment we’re saving all our money towards IVF treatments, so that’s our fun budget.

    When we weren’t saving so much we would go to different food places once or twice a month, that was fun.

    Tristan

  16. Fervent Finance

    I’m all about making my FIRE journey fun. As long as I’m hitting my big long-term financial goals, who cares if I’m saving 60% of my income instead of 70% because I want to have some fun with hobbies, travel, hanging out with friends, etc. You always need a little wiggle room to enjoy the journey. Also much easier said than done with higher incomes or living in low COL areas. But those two are choices we make.

    1. Desirae

      Definitely! It’s interesting how many FIRE people I talk to who say the same, even with their aggressive goals and timelines! I love it – it’s such a balanced way of looking at the world that’s totally “normal,” from people who are seriously excellent with money and are still achieving amazing things! (Like yes, we still have fun, DUH.)

    1. Desirae

      Comfy shoes are LIFE. I have my three pairs of work shoes perfectly broken in and they’re so great – I’m going to be the saddest human when one of them eventually gives out on me, haha.

  17. Kurt

    Fun is essential! The older I get, the more I use ‘will it be fun?’ as a screen to taking on commitments and generally choosing how to spend my time. Though a challenge for many people I think is they equate having fun and spending money. “If I’m not spending a lot of dough, I can’t be having fun.” Simply not true! Some of the most fun times I’ve had in my life were free, as I’m sure is true of all of us, if we just think about it.

    1. Desirae

      Oh man, YES to that – I need to start applying that filter to my time more! I need a good baseline rule to say yes or no to commitments and plans as they come up, and I might very well just steal that one! Especially since I couldn’t agree more – some of the best times are free.

  18. Kathy

    My husband and I put $400 each month into a fun money account. $100 for each of us individually and $200 for a joint category. It started so I could buy a pair of earrings, or something without trying t account for it in the regular budget, or if we’d exceeded our eating out budget and still wanted to splurge on a extra dinner out. Funny thing, now that I have that available, I can’t think of anything to send it on and my share has grown to $5000. Hmmm, what to do?

    1. Desirae

      Hahaha that’s amazing Kathy! I love that system as a concept and it’s one my boyfriend and I have discussed if we ever merge our finances fully. I think it’s so fun that you’ve saved up so much of it too – you have so much flexibility for fun! Because let’s be real, that’s a whole fancy vacation’s worth of fun!

  19. ZJ Thorne

    My college best friend had to remind me that I should not take away coffee away from home from myself because it brought me joy. Money is a tool and the present matters, too. We can’t just focus on our future selves.

    1. Desirae

      Definitely! And that’s the thing with the whole “latte factor” argument too – it never says anything about how much people love that latte! Your college best friend sounds super-wise 🙂

  20. Vic @ Dad Is Cheap

    Yes! I am a huge believer in the fun budget category. I’m still pretty frugal in general, but it definitely makes the budget not feel so restrictive when you can go out and spend without feeling bad about it. People seem surprised when I buy an iPad, go out on vacation, or go to a fancy dinner. But it’s in the budget :).

    1. Desirae

      Exactly! As long as it’s in the budget, you’re good – and life is way too short not to enjoy things like that! I remember your post about this kind of thing, and spending on experiences – so good!

  21. Sarah Noelle @ The Yachtless

    Hey! I’ve been meaning to comment on this post for a while. Thanks for writing about this topic — I feel like there is so much pressure to not spend money on *anything* that is “unnecessary” and it really gets to me. I think your $75 planner is lovely, and if it makes your life better, that’s awesome. I spent $108 on a massage last month and I’M NOT SORRY. 🙂

    1. Desirae

      Awwww thank you Sarah! I know you’ve been super busy so it means a lot! Lol you should see people’s faces when I tell them how much the planner was. The shock and awe is pretty much worth the price alone!

      And yessss massages! Good for you! I can only imagine it must have been *amazing* after all the running around you do all day!

  22. Jack

    I love this article! Guilt monster definitely eats away at me.

    Lately my goals have been more health based than financial (besides staying out of debt, and saving for future travel, retirement, and EF). I’ve spent a lot lately on hiking/camping equipment, running shoes and clothes, trail running clinics, physio etc. Sure that’s money that could have gone directly into savings but you know what? I feel AMAZING, so much healthier and happier, which translates to less sick time at work, and more energy to work at side hustles later if I choose. It also means I have the equipment to spend my weekends doing FREE activities.

    This was really a breath of fresh air. I get weary of the finance blogs that give off the vibe of “you bought an iced tea?! Omg you’re the worst”.

    1. Desirae

      Thank you so much Jack! I am all about the health and fitness goals right now too – I bought a membership to the “fancy gym” near my house, which is about $20 more than a regular gym, and no regrets at all, because I *love* it. I’m finally getting more into resistance training and I feel so much stronger, which is so worth the price of the membership alone (plus I go like 5 times a week, so the per-visit cost is negligible when I look at the benefits!) So so glad to hear your health and fitness spending is making you feel amazing too – as much as I wouldn’t spend unlimited money on it, you also really can’t put a price on health 🙂

      Also, iced tea?! You monster. 😉

  23. hodgepodgefinances

    Love this! We have a “Fun budget” and I always feel guilty about it since it’s a pretty “Healthy” budget. I now feel much better about my craft beer and puppy expenses.

    1. Desirae

      Craft beer and puppies are hands down the best expenses! Budget soulmates over here, because so much yes: my dog is like, half of my fun budget, lol. (Which makes for also yes, a very healthy fun budget, haha.)

  24. Jaymee

    Oh man, I’m reading this thinking “I COULD set aside $50 a month for fun budget… But then that’s $50 that could’ve gone towards my student loans.” Or I might just end up saving it up.

    But then maybe this is exactly the reason why I need to have a fun budget >.<

    In any case, it's worth giving it a shot for a month or two!

    1. Desirae

      Haha well, I mean, you know I think you should totally have a fun budget, but what “fun” is to you is totally subjective! Maybe that $50 a month becomes a “giant lump sum payment towards student loans” or “decorating fund for the new house” someday, if you do end up just saving it (or most of it!)

      I can’t be the only one who thinks putting large amounts of money into savings / against debt is fun, right? That’s normal?

  25. Emma

    Its surprising how hard it is to transition from the kids pocket money- do whatever you want with what you get, to budgeting and responsibilities which suddenly get thrust on your shoulders as you get older. Suddenly you are paying for your own clothes, pets and boarding etc. (not to mention the dentists!!!!).
    I’ve only just got to grips with my budget now, I’ve saved up quite a cushioning sum and can now start adding fun money! Yay! It helps having a dad who is an accountant and have good organization skills. He’s helped me plan my budget and work out how much I can afford for fun money.

    Yesterday I ordered a locked diary that I’d been really wanting for ages and was so excited to see that it was half price! It was such a good feeling to know that I could afford it and that I still had money for bills and savings. But most of all that I had waited until it was on sale and it wasn’t an impulse buy as it was something I’d been wanting for months.
    It really is worth it!
    Thanks for such a great article!

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