2735: Why You Should Totally Spend on Wants by Chris of Keep Thrifty on Intentional Living & Mindfulness

[00:00:00] This is Optimal Finance Daily, episode 2735.

[00:00:04] Why you should totally spend on wants by Chris of Keepthrifty.com

[00:00:09] And I'm your host and personal finance enthusiast, Diana Merriam. Now, let's get right to it as we optimize your life.

[00:00:21] Why you should totally spend on wants by Chris of Keepthrifty.com

[00:00:26] If you read enough personal finance articles, you're bound to have come across numerous discussions about needs versus wants.

[00:00:33] If you take the messages at face value, you'll come away with a sense that the majority of your financial issues come from an inability to minimize your wants.

[00:00:43] This sage advice comes from all over, whether it be from your favorite personal finance blogger or musicians from the 1990s.

[00:00:51] Quote, it's not having what you want. It's wanting what you've got.

[00:00:57] Sheryl Crow

[00:00:59] At the end of the day, most financial wisdom seems to tell you that wants are bad and you should get rid of those urges altogether.

[00:01:07] Live like a caveman and you can retire in three years.

[00:01:11] While I appreciate the sentiment, I think people take this too far.

[00:01:16] Money is a tool, a tool that's meant to be exchanged for things that are of value.

[00:01:21] Why are wants bad?

[00:01:23] If your wants are things that align with your values, aren't they completely worth spending on?

[00:01:28] Frivolous wants

[00:01:31] The problem is that unfortunately for most people, the wants they spend are not in alignment with their values.

[00:01:38] It's the cute but frivolous serving tray from the Target home decor aisle that they didn't even know existed until they entered the store.

[00:01:45] It's the awesome new thing on Kickstarter that's such a cool idea and looks awesome, but solves a problem they don't really have.

[00:01:54] It's habitual spending on in-app purchases, whether it's a new outfit for a digital pet or a new gun to kill those pesky zombies.

[00:02:03] These purchases are wants in the moment, but aren't usually an accurate reflection of real values.

[00:02:10] How do I know? Because Jamie and I have been there.

[00:02:12] We've always wanted to travel, but despite making decent income, we never seemed to find the money.

[00:02:19] Disappointed that we couldn't afford to travel, we'd blow our money on ice cream treats, carry-out dinners, revolving household decor, and kitchen gadgets.

[00:02:28] And because we blew our money on these, we never had the money to travel.

[00:02:33] It was a vicious cycle.

[00:02:35] But once we started tracking our spending, everything changed.

[00:02:38] We started to see how much we spent on ice cream, how much we spent on carry-out, how much on decor and how much on gadgets.

[00:02:46] And when we saw the totals, it was staggering.

[00:02:49] Values-based wants.

[00:02:51] Seeing the big picture of our spending helped us understand the crazy amount of money we were spending on frivolous purchases.

[00:02:59] When we saw those numbers rolled up, we knew we could shrink our frivolous spending without feeling any real pain.

[00:03:05] Cooking six nights a week instead of four would save us hundreds on our food bill.

[00:03:10] Cutting Target and Costco out of our shopping altogether would eliminate even more in impulse buys.

[00:03:17] And with these thousands of dollars, we could afford to travel.

[00:03:21] We could afford to increase our charitable giving.

[00:03:24] We could prepay our mortgage and save for retirement.

[00:03:27] Once we were able to look at our spending at a high level, we quickly saw that we had more than enough to spend on our wants.

[00:03:35] At least the wants that really added value to our lives.

[00:03:39] Over the last three years, we've refined this practice year over year.

[00:03:43] Three years ago, we spent $104,000 total.

[00:03:48] Two years ago, we spent $92,000 total.

[00:03:52] Last year, we spent $83,000 total.

[00:03:55] And this year, we've budgeted $80,000, not including our house-down payment and initial furnishing.

[00:04:01] And all the while, we've steadily increased our spending on value-adding wants.

[00:04:07] Three years ago, we spent $4,400 on travel and $6,700 towards charity.

[00:04:14] Two years ago, we spent $5,300 on travel and $2,750 towards charity.

[00:04:21] Last year, we spent $19,000 on travel and $4,000 towards charity.

[00:04:27] And this year, we've budgeted $12,000 for travel and $12,000 for charity.

[00:04:34] This is the spending that gives us joy.

[00:04:37] The spending that we feel aligns with our values.

[00:04:40] And I wouldn't eliminate this at all.

[00:04:42] These aren't bad wants.

[00:04:44] These are the wants that are most important.

[00:04:46] What's next?

[00:04:48] Jamie is going through the exercise of recategorizing all of our entries in Thrifty into value-based wants.

[00:04:55] Fun, also known as frivolous wants, and needs.

[00:05:00] Once we get through that, we're going to take a look at how our proportion between these has changed over time.

[00:05:06] And we'll share the results each year.

[00:05:08] Without seeing the numbers in front of me, I can tell you that we feel so much better about how we budget and spend today.

[00:05:15] Having money carved out for our priorities makes me completely comfortable saying yes to the last-minute family trip to Nevada.

[00:05:22] It makes us happy to increase our giving to great causes like the Hope Effect and World Vision.

[00:05:29] This process has changed our lives, and I bet it can change yours too.

[00:05:34] So, I challenge you.

[00:05:36] Track your spending for three months.

[00:05:38] Measure how much you're actually spending on those frivolous wants,

[00:05:42] and see what real wants you can afford if you cut the frivolous ones in half.

[00:05:51] You just listened to the post titled, Why You Should Totally Spend on Wants, by Chris.

[00:05:56] of KeepThrifty.com, and I'll be right back with my commentary.

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[00:07:51] This article reminded me that not all wants are created equal.

[00:07:56] I know a personal trainer who says, find a greater want,

[00:08:00] as a way to encourage her clients to choose their desire to be fit

[00:08:04] over their desire to hit snooze in the morning and skip their workout.

[00:08:07] We can have many conflicting wants,

[00:08:10] but it seems like the key is to constantly remind ourselves which of those wants we desire more.

[00:08:16] In essence, prioritizing our greater wants requires a conscious effort

[00:08:21] to weigh our desires against each other and make decisions that align with our overarching goals and values.

[00:08:27] Whether it's choosing between indulging in immediate gratification

[00:08:31] or working towards long-term fulfillment,

[00:08:33] the mantra of find a greater want serves as a powerful reminder

[00:08:37] to stay focused on what truly matters most to us.

[00:08:41] It's about recognizing that while we may have various wants pulling us in different directions,

[00:08:46] our ability to discern and prioritize our greater wants

[00:08:50] ultimately shapes our path to personal growth and fulfillment.

[00:08:54] By embracing this mindset, we empower ourselves to make intentional choices

[00:08:59] that lead to a more purposeful and rewarding life.

[00:09:01] And that's a wrap for another Thursday show.

[00:09:04] Have a great rest of your day, and I'll be back tomorrow where your optimal life awaits.