Spend What’s Left Over After You Hit Your Monthly Financial Goals

The NYT advocates in favor of spending—but buries the most important part.

After seeing so many financial experts argue that we need to be stockpiling cash, I was delighted to read this headline in the NYT:

Sometimes, Spending Brings a Bigger Return Than Saving

Tell me about this spending theory! Why should we be spending instead of saving? Are we going to get a more reliable car? A better mattress? Or… oh wait, it’s experiences, we’re supposed to be spending money on experiences.

But once we got out there in the kayak on that crystal-clear water, all I could think about was how happy my wife and I were as we were enjoying that experience together. So, ask me now, was it worth it? Let me just save you a lot of time and energy, and give you the answer to that messy equation: Spend the money!

Sounds good! I’ve done that kind of spending before, and I’ll probably do it again. I’m all in favor of experiences!

But then we get this:

Do you have something you want to do with someone you love, and the money to pay for it, and the only reason you’re not doing it is that you have this nagging feeling that you should be saving the money for some vague goal beyond the basic ones you have already articulated for yourself? Spend the money! Then, do it again. And again. And the next time? Spend the money!

It’s buried so tightly into this paragraph that you almost miss it: you’re not supposed to spend the money until you’ve met your other financial goals.

It’s a two-parter, actually. First, you need to “articulate” your financial goals, which not everybody does. You can’t just say “I want to save money” or “I want to pay down debt,” either—because then you’ll get stuck in the “well, I’ll go on vacation now and pay down debt later” thing. (Trust me. I’ve been there.)

So okay. You articulate your goal. In my case, I went from “I want to pay down debt” to “I want to put 20 percent of my income towards debt repayment.” (It worked.)

Then you get to the second part: meeting your financial goals. Paying yourself first, as the saying goes.

I know that y’all are already familiar with this, we’re on The Billfold together every day, but I’m reading this NYT article and thinking “you took the most important part of your story and hid it!” If you’ve got a nagging feeling that you should be doing something with your money besides spending it, you might not have a well-articulated plan for where you want your money to go long-term. (I met several of my financial goals last year, and you’ve seen me post about the difficulty of figuring out where to put my money next.)

And yes, goals change—and yes, sometimes an experience comes up that’s so important it’s worth temporarily adjusting your financial goals.

But goals are important. Even though “Spend What’s Left Over After You Hit Your Monthly Financial Goals” isn’t a very exciting headline.

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