Intentional Spending

When we think of spending, our minds often drift to the word ‘budget,’ which joins the equally unpopular word ‘diet’ in connoting a sense of restriction. With a perspective based on limits, it’s hard not to misstep – which then feels like failure. Feeling like you’ve gotten off track makes it difficult to drum up the energy to reengage, or when inflation drives up prices it can feel like you are always playing catch-up. Spending money is not an inherently bad thing, but people can feel conflicted or uncertain when they aren’t sure of its impact on other choices.

For a fresh start, consider taking a wider view of your cash flow and envision a spending plan rather than a budget. Spending can be intentional and joyful. Proactively creating a spending plan fosters a sense of control, gives you flexibility, and the opportunity to nourish relationships. Transforming your approach to spending in this way takes you beyond the restrictive frame of budgeting to live in alignment with your priorities.

Practically speaking, creating a spending plan starts with looking at your total net income, which is the monthly or annual pool from which you finance all your needs and wants. Consider and combine your varied income sources: earnings, net business profits, pensions, rental income, and regular portfolio distributions. If part of your income includes a variable bonus, it may be helpful to think about that income separately, and not rely on it for basics.

Next, think about the things that make up your core expenses. They will look a little different for everybody, but generally include housing, food, basic utilities, transportation, clothing, and healthcare. As you quantify your core expenses, you can re-evaluate any automated spending such as ongoing subscriptions you don’t read, or streaming services you aren’t using.

As you explore these basic categories, personal preferences and priorities will emerge. Acknowledging those preferences – and understanding the dollar amounts – makes it easier to cut back on the areas that are less important to you. For example, I enjoy having meals at home with my family, rather than going out to eat regularly during the week. But we have limited time to shop for groceries, so I choose to spend extra to have groceries delivered. I get a couple more hours each week with family and friends and in exchange am happy to spend less on eating out.

Once you have a handle on your basic expenses, the second step is to consider savings. Setting aside current income is like putting a down payment on a future activity, such as holiday gifting or a vacation. It feels relevant and exciting to go through the exercise of envisioning future scenarios and sense what it will be like to live them. It’s common to simply spend what we want to or need to each month and save the remainder as almost an afterthought. Reversing the order and knowing what you want to accomplish in the future makes foregoing additional spending in the present much easier.

You might be saving for a short-term goal, like a small home improvement project. Maybe it’s a longer-term goal, like financing retirement or kid’s college expenses. It may be something with no specific timeframe, such as the peace of mind that you are able to handle an emergency veterinary visit for your furry loved one. No matter the time frame, intentionally setting money aside to accomplish those goals frees you to move on to the final step of the process – spending your remaining income entirely as you choose.

Spending the remainder can sound energizing, and with some intentionality, it can be even more fulfilling. Consider how you connect with your passions, your friends, your community. Do you love to visit museums or seek out Michelin star restaurants? Do you enjoy going away for an impromptu weekend trip, or throwing parties for family? You may take pleasure treating a visiting relative to concert tickets or adding to your store of fabrics for a quilting hobby. The goal is to be able to say ‘yes’ to these opportunities.

Intentional spending doesn’t stop with personal needs. You may direct part of your discretionary resources to community efforts as well, whether buying Girl Scout cookies, supporting a local election campaign, or contributing to local nonprofits. These spending decisions support the vision of the life you want to be living and the community you want to be part of.

We often are trading financial value for satisfaction. Our choices reaffirm our sense of ourselves and our identity, provide for family, and express our connections to friends and community. Instead of limiting ourselves with a budget, let’s express ourselves with a spending plan. When you have a spending plan aligned with your values, it’s easier to give yourself permission to enjoy the spending and invest in living.