Why You Need Some Fun Money in Your Budget
Is there wiggle room in your monthly spending plan for a little fun? You might be cutting back on spending in order to get out of debt or attain some other significant financial objective. It’s commendable to become more frugal, but it may be counterproductive to eliminate funds for entertainment.
Read on to find out what “fun money” is, why you need some, and how much of it you should set aside each month.
What is fun money?
Monthly spending on whatever offers you the most joy should come out of your “fun money.” Everyone has a different interpretation of what “fun money” entails. The good news is that you can spend this “fun money” guilt-free because it was already factored into your budget.
Why fun money matters
When money is tight, it’s easy to feel guilty about spending it on something as seemingly unnecessary as entertainment.
You might overspend if you save too hard
The reverse of what you want may happen if you try to limit your spending. Cutting back on entertainment costs may seem like a good way to save money in the short term, but it usually leads to spending on impulse or emotion down the road.
Cutting back on spending is like trying to lose weight by starving yourself. If you don’t give yourself any breaks, you won’t be able to maintain your discipline and may end up going too far in the opposite direction.
You could develop a bad money mindset
You might even convince yourself that investing in yourself is a waste of money or that you don’t deserve the rewards. It can even cause you to feel bad about spending money you have set aside for a certain purpose.
You might give up on your financial goals
Have you ever attempted a long-distance race, such as a marathon? It’s unlikely you’ll make it to the finish line if you try to sprint the entire first mile. The same holds true for long-term monetary objectives. Keeping a healthy pace means setting aside some of your hard-earned cash for entertainment purposes.
How to budget for fun money
Putting aside some cash each month for entertainment may seem like a no-brainer, but it’s not always so straightforward to put into practice.
There are a few different budgeting methods you can use to help you choose how much to save each month and to guarantee that you always have some discretionary spending money available.
Paying yourself first
One common method of budgeting is called “paying yourself first,” in which you put money towards your own needs and wants before paying anyone else. If you follow this budgeting strategy, you won’t have to worry about running out of cash before you’ve had a chance to save or pay down debt.
Frequently Asked Questions
Why is budgeting for fun a good idea?
Budgeting in some “fun money” is just another technique to avoid unnecessary spending. Keep in mind that a zero-based budget requires assigning a purpose to every single rand. Another benefit of having a separate line of spending money for entertainment is that it forces you to prioritise your spending, even on frivolous items.
What can you do with fun money?
Monthly spending on whatever offers you the most pleasure should come out of your “fun money.” Everyone has a different interpretation of what “fun money” entails.
What are the benefits of having money saved?
Having financial stability and independence puts you in charge of your life and gives you the freedom to pursue the life you want. Having financial stability and enough savings allows you to choose your life’s priorities while still enjoying the lifestyle of your choosing.
What does a budget show you?
Create a monthly spending plan with the help of a budget. Having a monthly spending plan in place can help you avoid financial hardship. You can use a budget to save for your goals or for unexpected expenses.
