Go ahead, spend that money


We’ve heard a lot of advice on saving money that implies spending is evil. We are not suggesting ignoring the wisdom of saving for the future. But can we predict the future? We may not even reach our retirement years if something unexpected happens.

We work hard to earn money. Shouldn’t we enjoy spending it? Yes, we should take care of our future financial needs but we should also live in the present moment. So spend your money to make yourself happier.

1. Smart budgeting: spend for maximum enjoyment

Spend time thinking while drafting your budget. Focus on spending less but smartly. Allocate expenses to things that give you joy and well-being.

Many of us know fixed and variable expenses are the two primary categories of a budget. But you can also separate the expenses into your wants and needs. If these two ways are combined, the expenses can be then separated into four categories:

• Fixed needs

• Fixed wants

• Variable needs

• Variable wants


“Variable wants” are happiness-boosting activities that you should spend your money on for increased happiness. Place priority on spending that brings positive meaning or experiences to your life.

The aim is to reduce spending and free up funds from the first three categories. Then use these funds to increase spending on the variable wants.

What are these “happiness-boosting” variable wants?

2. Buy experiences and memories over more stuff

After establishing your smart budget, plan the details of your happiness-boosting variable wants.

Experiences provide greater satisfaction than material things. For example, you excitedly look forward to your holiday in two weeks’ time. You are picturing that getaway walking along the beautiful shoreline.

Those two weeks of expectation and anticipation is a huge supply of positive energy. Later, looking at the pictures and reminiscing will bring you joy again.

Another way to increase happiness is to spend on other people.

3. Spend on the right people

If asked to choose between spending money on ourselves or other people, we are happier spending on other people.

Spending your money to see a smile on another person is truly extraordinary compared to spending it on possessions. Giving happiness to others, and getting happiness in return is happiness doubled.


Simple giving can be done and be a part of your daily life. For example:

• Take a friend to lunch.

• Treat your loved one to a spa.

• Get coffee or doughnuts for your colleagues at work.

• Give a packet of food to a homeless person.

• Doing these meaningful things for others increases your own happiness.

In contrast, do you have things you have to do but hate to do? This is where the next best way to spend your money comes in, buying time.

4. Trading ‘unhappy’ time for ‘happy’ time

Do you have things you absolutely hate doing? Would you be happier if you could afford to pay someone to do it? Of course you will be happier freeing your valuable time doing things you enjoy.

Spend money to enable you to focus on who and what you love.

5. ‘Buying’ companionship

Picture your life without any friends. That would be a sad and depressing life. Having all the money in the world is meaningless if we don’t have friends to share life with.

Having great company with stimulating conversation is relaxing and comfortable.

Instead of eating alone, invite a friend for a meal. Your friends will appreciate this and reciprocate by inviting you back.

Companionship can come in the form of adopting a pet from an animal shelter. Imagine coming home from a hard day’s work to be greeted by your loving furkid. It’s instant stress relief.


Direct your spending on things that increase your well-being. Focus on things that have a positive meaning for yourself, your family, and friends, while reducing expenses.

Over the long term, you will spend less but have a happier and better life. It all starts with having a smart budget that fits who you are.

This article first appeared in https://mypf.my

MyPF is on a mission to help simplify and grow Malaysians’ personal finances through financial education.