Permission to Spend

Let's play a quick word association game.

I say 'budgeting'.

What connective words does your brain come up with?

If we were playing Family Fortunes, and you said 'permission', I think very few, if any, of the audience survey will have said the same.

I don't know that for certain of course, I'm not Les Dennis.

But from my experience of conversations I have with clients about budgeting and spending on certain things, it seems that the word "budget" often carries a connotation of restriction and deprivation.

For many, it evokes images of tough times, cutting back, and denying yourself the things that make life enjoyable.

When done right, a budget isn’t necessarily about limiting spending; it’s about empowering yourself to spend wisely. By embracing a budget, you can give yourself permission to spend on what truly matters, without guilt or anxiety.

Understanding the Purpose of a Budget

A budget is not merely a tool for curbing spending—it's a framework that helps you allocate your spending in a way that aligns with your values and goals.

Think of a budget as a personalised spending plan, designed to ensure that your money is working for you, not against you. It helps you identify your priorities, whether they be saving for a deposit on a home, travelling, investing in your education, or simply enjoying life without financial stress.

By establishing a budget, you can see clearly where your money is going and ensure that it reflects your true priorities. This clarity can be liberating, as it allows you to make informed decisions about where to cut back and where to spend, without the lingering guilt that often accompanies unplanned spending.

Shifting the Mindset: Permission to Spend

One of the key benefits of a budget is that it gives you explicit permission to spend.

Setting aside money for specific categories—such as entertainment, dining out, or hobbies—you’re essentially telling yourself that it’s okay to enjoy these aspects of your life and allocate both your time and money to these things.

You’re not overspending; you’re spending within the boundaries you’ve set, which is both responsible and empowering.

For instance, if you allocate ￡150 a month for dining out, you can enjoy meals at your favorite restaurant without worrying about whether you can afford it. That money is there, set aside specifically for that purpose.

The beauty of this approach is that it eliminates the anxiety that often accompanies spending because you know you’ve already accounted for it in your budget.

Prioritising Joyful Spending

A crucial aspect of giving yourself permission to spend is identifying what brings you joy and fulfillment. Your budget should reflect your personal values and passions.

If traveling is what makes you happiest, then prioritise it in your budget. Conversely, if certain expenses don’t bring you much satisfaction, reallocate that spending to something that does. Clearly I'm not talking about council tax here, that one's got to be paid if you want the bins taken away each week.

The concept of “joyful spending” involves focusing on expenditures that enhance your life, rather than feeling pressured to spend on things that don’t. This approach encourages mindful spending, where every dollar spent contributes to your overall happiness and well-being.

The Balance Between Saving and Spending

While it’s important to give yourself permission to spend, it’s equally crucial to maintain a balance between spending and saving. A healthy budget should incorporate savings goals, whether they be for an emergency fund, a home move, retirement, or other long-term objectives. By doing so, you ensure that your future self is also taken care of.

The balance between spending and saving can be fine-tuned by regularly reviewing and adjusting your budget. Life circumstances change, and so should your budget. If you find yourself consistently under-spending in one category, you might consider reallocating those funds to another area that brings you more joy or towards increasing your savings.

Practical Steps to Implement a Balanced Budget

1. Assess Your Income and Expenses: Begin by calculating your total monthly income and listing all your expenses. Categorise your expenses into fixed (rent, utilities) and variable (entertainment, dining out).

2. Set Financial Goals: Determine what you want to achieve with your money, both short-term (e.g., saving for a holiday) and long-term (e.g., retirement). Your goals will guide your budgeting decisions.

3. Allocate Funds Mindfully: Distribute your income across different categories, ensuring that you’re covering essentials, saving for the future, and allowing yourself room to enjoy life.

4. Review and Adjust Regularly: Your budget should be flexible. Review it every so often, say once a year, to ensure it still aligns with your goals and make adjustments as necessary.

5. Celebrate Small Wins: Acknowledge when you’ve successfully adhered to your budget and treat yourself within the limits you’ve set. This reinforces positive financial habits.

Giving yourself permission to spend within a budget is about more than just managing money; it’s about reclaiming control over your financial life and using your resources in a way that maximises your happiness.

Embrace the freedom that comes with a budget—it’s not about limiting yourself, but about living a life that’s rich in the ways that matter most to you.

???? Hi, I’m Jamie, MD & Certified Financial Planner at Lab Financial Planning.

I help Busy Professionals, Business Owners & Contractors with their financial planning.

The aim is to give you ?????????????? and ???????????????? your money. Giving you the ?????????? ???? ???????? to get on with living your life without money worries.

Feel free to take a look at our website and get in touch if you'd like to discuss your financial planning.

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