Ask Nicole: Should I Feel Bad About My Big Purchase?

Photo credit: Eliezer Pedroso, CC BY 2.0.

Dear Nicole:

At the beginning of the summer I set myself this “no more than $400 in unallocated discretionary expenses” budget that I was able to stick to for one month. This month, I bought a $1,099 digital piano and told myself I would pay for it out of my savings. Should I feel bad about this?

Thanks,

Over-Budget Beethoven

This is an interesting question, OBB. You write “should I feel bad about this,” which implies that you don’t actually feel bad about it — but you think you ought to feel bad, probably because you had one financial goal at the beginning of the summer and then you changed it.

I know a little bit about your current financial situation, so I know you originally set that $400-per-month goal as a way to ensure you could pay back the money you spent on some combination work-and-vacation travel you did earlier this summer. You owed that money to yourself, and I guess I’m curious why you feel like you need to erase your previous spending by, like, re-saving all the money.

I can hear you telling me that you want your net worth to trend consistently upwards, and you want to make sure you checking account always has at least $3,000 in it, and since your summer travel affected both of those metrics you feel obligated to get them back to where they were.

No, wait. It’s not obligation. It’s ambition. It’s something you’re pretty sure you can do if you try really hard and plan all your spending in advance and limit yourself to $400 in unplanned spending, per month.

Which, by the way, is huge. I remember when your budget only let you have around $100 in unplanned spending per month. This is also why you were pretty sure you could pull this off.

And then you went and bought a piano. (Yes, a digital piano. Technicality.)

I also know that you had a few good reasons for buying a piano this month, instead of putting it off until September or October or next year, but since I’m trying to pretend that I don’t know who you are, I’m going to give you the advice I’d give anyone else in this situation. It comes in the form of a question — really, three questions:

1. What does this purchase help you achieve?
2. What does it push you away from?
3. Are you okay with that?

These are the only questions that matter. Asking yourself what you should feel is irrelevant — nearly as irrelevant as a financial goal you made almost two months ago. We get to continually decide whether our goals are worth pursuing, and in this case, it looks like you went after a different goal.

You’re also at a stage of financial stability where you can think about your money in terms of goals, instead of needs. I’m betting that in the past you might have made a different decision, because making a large purchase would have pushed you away from the need to pay your bills. However, it’s worth reframing those questions as “needs” just to make sure you aren’t missing something:

1. What need(s) does this purchase help you achieve? An artistic outlet that also gives you opportunities to participate in community activities.
2. What need(s) does this purchase push you away from? The need to have a certain amount of money in your checking account at all times. The need to not spend any of your savings.

These needs appear to be emotional rather than practical (with the possible exception of “participating in community activities”), which isn’t to discredit any of them because emotional needs count, but does indicate that you’re not in danger of getting evicted or anything. Nor are you in danger of not achieving another practical goal, such as saving up for a down payment — your financial goals appear to be somewhat arbitrary, even though I can hear you telling me that you have a good reason for wanting a certain amount of money in your checking account at all times. It’s a Personal Finance Best Practice, and the kind of person who buys herself a piano is the kind of person who is very good at practicing.

But look at what you’ve shown me. This particular purchase helps you achieve needs that are associated with personal and social growth. It pushes you away from needs that are associated with not wanting to change. This is probably why you don’t feel bad, and also why you wonder if you should feel bad. What if you change so much that you spend all of your money and can’t pay your bills in the future?

Well… you have many more purchases to make before you’re in danger of that, and if you keep asking those three questions you’ll be able to tell when it’s time to pull back on the spending. At some point a savings goal will probably become more important, either because you’ve spent down your savings or because you’re saving up for something even larger than a piano.

Plus — and again, this is because I know you — you’re still putting money into your savings account with every paycheck. That’s another Personal Finance Best Practice, and it’s one that’s going to help you achieve those long-term goals of net worth growth and “having as much money as you had before you took that trip in June.”

Or, in this case, “having as much money as you had before you took that trip in June and bought a piano.”

I hope you love your new piano. I’m pretty sure you will.

Nicole

If you have questions for this brand-new advice column, email nicole@thebillfold.com. 

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