Spending money is a part of our everyday lives. Still, everyone knows some purchases are more valuable and impactful than others. Many (but not all) material things aren’t a good way to spend your money; they are usually driven by impulse and only may be useful in the short term. While spending money on things like savings, your well-being, everyday essentials, and experiences will always be the better choice. Wondering more about the best things to spend money on? Below are some of the best purchases you can make!
The Best Things To Spend Money On: Your Future Self!
Your future is one of the best things you can spend money on and will make your life easier! Some of these expenses may actually mean saving money instead of spending. Regardless if you are saving or spending, the money will come from the same place. Here are some examples of the different ways you can spend money, to ensure your future-self will thank you:
Building a Savings Account
An emergency fund is essential for unexpected expenses that can come up. Most experts recommend a minimum savings of three months of living expenses. Having an adequate safety net can prevent debt or, more importantly, long-term financial hardship. And so, putting money into a savings account is a great way to “spend”. You can start saving with a few baby steps. For example, by being smart about your everyday expenses like transportation or groceries, you may be able to save on a daily basis, which can add up over time!
Another great way to spend money is with retirement savings. If you haven’t thought about retirement yet, it is never too late or early to do so! The first place to start will be with your employer if they offer a 401k plan. There are also independent retirement plans you can look into called independent retirement accounts or IRAs.
Investments are another great way you can spend money. There are all kinds of investments you can research and put your money into. For example, a home is a common one that you can enjoy while building equity. Other types of investments include the stock market, bonds, certificates of deposits, and assets. When done right, the great thing about spending money like this can mean return or passive income, making your money work for you.
Spending Money On Education
School is expensive, but it is worth the cost for many people! Putting money into the proper education or training may be a great way to improve your quality of life long term. It can help you find a career you like and make more money. Whether a master’s degree or certification, having the right education can set you up for success and financial security.
Paying Off Debt
Saving money can only go so far when you have debt. Another great thing you can do to improve your Personal finance strategies all around, is to pay off debt. Whether you have credit card debt, a pay day loan, or a personal loan, the sooner you pay it off, the sooner you can have financial freedom. There are personal finance books you read, blogs, and even listen to podcasts to find some basic strategies to pay off debt quickly. For example, the avalanche or snowball method are two commonly used strategies for debt payoff.
One of the Best Things To Spend Money on Is Your Health and Well-being
Many people may not think about their health or well-being until something is wrong. However your physical and mental health are essential for a fulfilling and happy life! And so, hands down, your health is one of the best things you can spend money on. Purchasing a gym or exercise class membership, spending money to eat better, and therapy are all great places to start. The great thing about these expenses is that you can pursue them on a budget.
Spending Money on Hobbies and Experiences
Everyone has something they like to do or hobbies that they like to participate in. Experiences and hobbies are great ways to spend money when you have some extra income left over after essentials. Whether you are into art, video games, traveling, or a foodie. This kind of discretionary spending can benefit your mental health and help you build memories with friends and family.
Things You Use Everyday That Are Meant for Long Term Use
Another good way to spend money is on items that you will use for an extended period of time. Instead of going for the cheap end, you may want to spend more money on these things to get a quality product. Think about these purchases as a kind of investment on essentials you need vs. spending money on things you want. And, in some cases, what you buy may be an investment if you can sell it later. Here are a few examples of material things that are actually worth paying extra money for:
- A Mattress — Most people have a mattress for 30 years or longer– longer than the average home! And if you think about it, you spend at least eight hours a night on it! And so, spending money on a good mattress can be an excellent investment for your overall well-being.
- A New Car — Cars may not be considered the best investment but are basic needs for most households in the United States. Depending on how much you drive, a high-quality car can last more than just a few years. And so it may be a better idea to pay more for a better quality vehicle rather than go for the cheapest option.
- Shoes and New Clothes — Some people may qualify clothes and shoes as wasteful material purchases and may even feel guilty about buying these things. However, depending on what you do for work and fun, clothes and shoes can be good things to spend money on!
- Furniture and Home Appliances — Your home furnishings and appliances are other everyday items that you will use, likely for a long period of time. And so, spending money on these things, especially when starting from scratch, can definitely be an excellent way to improve your quality of life. There are even appliance and furniture loans you can apply for that make it possible to finance these essentials.
- Home Improvement or Renovation — If you are a homeowner, spending money on home improvements or renovations are a great way to add equity to your home.