Try to Be a Little More Zen About Spending Money on Important Things

What good does freaking out over expensive but worthwhile purchases do, especially if you can afford to splurge? Nothing, according to research (from Kipslinger via the New York Times):

Spendthrifts don’t feel enough pain for their own good, so they overspend, carry more debt and feel guilty later. Tightwads, however, experience too much pain, which leads to feelings of regret for not having spent enough. Rick says it’s worse to be a spendthrift because of the financial costs, but neither extreme is as good as the middle group, labeled unconflicted. “Spendthrifts are bad off financially and psychologically,” he says. “Tightwads have big bank accounts, but we find that they’re less happy than the unconflicted group.”

So how can you become the Goldilocks of finance and worry the “just right” amount? You can start by paying with a card instead of cash, because research shows that people feel more carefree when they’re not literally parting with tangible money. (We’re simple animals, really.) (Also, um, there might be a thin line between “feeling carefree” and “major credit card debt.”) But according to financial planner Carl Richards, it’s more important to try and feel happy when we spend money on things we value that are within our budget:

Next time you reach for the debit card, or cash (if you like pain), ask yourself this:
1. Does this fit in my budget? In other words, can I afford this?
2. Is this something I value?
If the answer to both is yes, then you should be able to put a stop to most of the pain and actually enjoy the purchase. This is one way we really can spend our way to happiness.

Alright, I’m game! Here are the two largest purchases I’ve made in the past month:

1. Plane ticket to visit my best friends in San Francisco = fits in my budget and I value it! Score.
2. New phone to replace the one I drunkenly left in a cab = ……