Best Things to Spend Money On

If you found this post, then you also probably wondered what the best things are to spend money on.

Congratulations! If you’re researching ideas on how to spend your money, it means you want to make the most of your money by spending it on things that make a lot more impact on your life.

I don’t know about you, but I invest in my physical and mental health, financial freedom, and overall happiness for my family. I always strive to put my money on things that align with my goals for my family. I still spend on wants sometimes and that’s okay, but I make sure that a big portion of my income is spent on things that add value to our lives.

If you are looking for ideas on things to spend money on, then read my list of “best things” money can buy. I don’t claim though that this is the ultimate list of things everyone should spend their money on. Your priorities, goals and situation may be different from mine, and this list may not fit into your life. However, I hope that you’ll find some inspiration from this post.

Spending Money on Your Financial Future

Saving money is spending money; the only difference is that you are saving money for your future self.

Emergency fund

If you have the long-term goal of achieving financial security, then your emergency fund is one of the best things to spend money on. Although technically speaking, you will only be spending money once you build your emergency fund, as it’s supposed to stay there until you need it.

But why is having an emergency fund so important apart from your separate savings account?

Your emergency fund will tide you over a financial crisis and prevent you from going into credit card debt. With an emergency fund, you can readily address a bad financial situation without going through so much stress. With an emergency fund in place, you could carry on with your daily life and not incur any more financial woes despite the curve balls life throws at you.

Savings Account

Once you have set aside a reasonable amount for an emergency fund, the next thing to spend money on is your savings account. Again, I emphasize that your emergency fund should be separate from your savings account.

Put money into your savings account to realize your financial goals. For example, would you like to save for your next home? If you want to do a major home remodel or bring your family on vacation, saving money allows you to afford these essential purchases.

Retirement savings

We also need a separate account for retirement savings. Unlike your regular savings account, your retirement savings are dedicated to this sole purpose: to fund yourself in your golden years.

Spending money on your retirement today allows you to live a good and comfortable life when you are out of the workforce or working shorter hours.

Chances are, your company or employer already contributes to your retirement plan through matching contributions. If possible, try to max out this amount to get the most money. Otherwise, you could bump it up and increase your contributions every year.

Additionally, look into other retirement savings like IRA and ROTH IRA. The critical thing to remember when saving for retirement is the earlier you start saving, the better. Retirement savings grow through the power of compound interest, so you’ll have more leverage if you start early and save consistently.

Pay down debt

If you’re making more money or have extra cash, you could significantly change your life by using said money to pay down debt. You could crush your student loans and pay off personal loans and credit card debt. Debts with high interest rates, like credit card debt, can drag you down, preventing financial freedom in the future.

Set up your own business

You can make extra money by starting your own business or side hustle. You can start saving money on other important things by creating an additional income stream. For example, you could use all that side hustle income to pay down debt, finance your home, or invest in your retirement.

Starting a business or side hustle comes with operational costs. For example, you may need to spend money on equipment, space, and workforce. Still, running your own business is an excellent investment for your future.

Spending Money on Yourself

Spending money on yourself should not make you feel guilty. You are putting money into the best investment, and that is you. But if you want to really maximize your money, you want to spend money on things that help you improve YOU.

So what are the things to spend money with yourself as the focus?

Hobbies

If you have the extra money, it’s good to spend some on your hobbies. Whether you like crafting, painting, reading books, or doing home projects, these hobbies help you become a better person.

According to Utah State University, hobbies can help us improve our mental health by reducing stress, enhancing well-being, developing connections that help alleviate anxiety and depression, and improving our mood. You can even make money from hobbies! Check out this list of inspiring hobbies that make money.

Quality sleep

Sleep does not cost anything, but some people don’t get as much quality sleep as they should. If this is you, consider paying for things that improve sleep quality.

A good mattress, for example, can profoundly help you sleep better. While expensive, a good mattress can help alleviate back pains and improve mood and overall well-being. Moreover, since we spend one-third of our time sleeping, a good mattress is an excellent way to spend money.

Good food

We’re not talking about expensive food, but nutritious food that helps you improve your physical and mental health.

Eating healthy is essential in our daily life. Good healthy food keeps us in tip-top shape and prevents several diseases (which, if left unchecked, could lead to expensive medical bills). So, it only makes sense to spend money on food that addresses hunger while keeping you in good shape and maintaining great overall well-being.

New clothes

If you want to be the best version of yourself, consider new clothes and shoes. Looking good often equates to feeling good. It’s a struggle to feel great and confident in yourself if you wear drab and ill-fitting clothes. Set aside discretionary spending in your budget and spend money on material things like clothes, shoes, bags, and accessories.

Spending Money on Health

Did you know that 100 million adults carry health-related debt? So, if you want to spend money, spend it on things that improve your health and well-being. With that in mind, you’ll save money in the long run.

Health insurance

First, invest in a good health insurance plan. You can never predict when you’ll get sick, so solid health insurance protects you financially from medical debt. Sure, you could dip into your emergency fund if needed, but a good health insurance policy gives you much more wiggle room to recover nicely.

Health check-ups

Preventing diseases is also an excellent way to save money. Keep up with your doctors’ appointments and attend routine health checks, even when you feel fine. Your future self will thank you for being vigilant with any potential issues that could impact your physical health. Also, the healthier you are, the more productive you become, and you’ll most likely succeed in life.

Exercise

Working out is also essential in maintaining excellent physical health, so it’s good to invest money in things that help you exercise better. Gym membership is an option, but you could also use free exercise options like walking or jogging. You’ll want to spend money on high-quality running shoes and some workout clothes, though, but that’s always money well spent.

Spending money on education

College degree

Whether you’re planning to spend money on your college degree or your kids,’ there is no doubt that a college education is one of the best things to spend money on. A college diploma gives you an advantage in earning potential, career opportunities, and improved quality of life.

That is not to belittle those who have not attended or finished college, as many successful people fall into those categories. But, if you have the opportunity and resources to pursue and complete your college education, then by all means, grab it.

Learning new skills

Spend time and put your extra money into learning new things. Identify things or areas that you want to explore and learn more about. For example, would you like to learn more about photography? Digital marketing? Public speaking? These are some of the best things to spend money on because they help you develop as a person, improve your self-worth and confidence, and help you earn more and put more money into your bank account.

Nowadays, there are plenty of ways to learn new skills. You could search for online classes or training in a field. You could participate in seminars and webinars by experts. You could find a coach or mentor.

Personal finance education

Buying personal finance books or subscribing to personal finance experts helps enrich your knowledge of personal finance. Whether you want to learn more about how to save, spend, or invest, these are essential resources to help you improve your financial life.

Personal finance education also has mental benefits. Learning to manage your income makes you less stressed over financial woes. No amount of material things can ever rival the worth of having personal finance knowledge, so it’s one of the best things to spend money on.

Spending money on quality products in your home

For me, spending money on quality home products as opposed to things that fall apart after a few months is always a better idea. While good quality products tend to cost more, they pay for themselves in the long run if you calculate the cost involved in the replacement and repair of cheap and unreliable products.

Good quality products are safer, more durable, energy-efficient, and more comfortable. Also, these products can help increase the value of your home. Investing in quality home products is a wise investment if you have the extra cash.

What home products are the best things to spend money on?

Home appliances like fridges, dishwashers, washing machines, and ovens. You use these home appliances daily, so investing in good brands can bring the best value for your buck (and eliminate repair bills).
Home furniture like couches, outdoor seating furniture, dining tables, and chairs. If you have extra cash, opt for brand-new furniture from reputable brands that last longer.
Safety products like fire extinguishers and smoke detectors. Do not compromise your family’s safety by buying cheap rip-off safety products. You need the guarantee that your fire extinguishers and smoke detectors will work when they’re supposed to. Admittedly, you must spend extra money to buy branded and dependable ones.

Spending money on home improvements

Home improvements are one of the things to spend money on. Paying a premium on the quality of service and workmanship is like investing in the future. A safe, secure, and well-maintained home is safer, more comfortable, and more functional. For example, spend money on improving insulation, replacing old and worn-out gutters, or beautifying your deck.

It’s essential to consider the cost and potential return on investment when making home improvement decisions. Research your options, compare prices, and consider energy efficiency, durability, and longevity factors. By spending money on strategic home improvements, you can improve the quality of your life, increase the average price or value of your home, and potentially save money in the long run.

Spending money on experiences

For some people, spending money on experiences is a top priority over material things like designer bags and luxury clothing.

Psychology professor Dr. Thomas Gilovich, from Cornell University conducted a 20-year study called the Paradox of Possessions. According to him, spending money on material things provides short-term and fleeting happiness. That is, because we get used to material possessions quickly, we need to upgrade to the next new and shiny thing and beat the Joneses.

So instead of spending money on material possessions, Dr. Gilovich suggests we divert our financial resources to intangible and worthwhile things, like experiences.

Traveling, going to festivals and concerts, trying out new and exotic dishes, and indulging in new adventures become part of who we are. These experiences are ingrained in our memories; they change our perspective and influence us in a way that material things cannot.

Also, you don’t need to spend more money to have memorable experiences. You can travel on a budget and find cheaper alternatives. For example, you can bring your kids to the zoo, camping, or visit the museum. Setting up a tent and stargazing in the backyard is already a great experience.

Spending money on relationships

Nurturing relationships is also one of the best things to spend money on. It is essential to stay connected and bonded with family and friends because they are part of our lives.

Here are some of the most meaningful ways to spend money on our loved ones.

Date nights with your partner

Going on an exclusive date night with your partner or spouse is one of the best ways to spend time and money. You get in touch with your life partner without any household or job stressors. A simple date night allows you to reconnect and fall in love even more deeply.

Time with your friends

Apart from our immediate family, spending time with your friends is also good. Whether you are window shopping together, grabbing a quick brunch, or going out for cocktails, the time you spend can boost your mood and happiness. Also, you make new and meaningful experiences with them.

Traveling with family

For instance, you spend money to visit your family who lives out of the city for the holidays. Of course, this trip costs money, but you also get to reconnect with such special people in your life.

Important milestones and celebrations

Celebrating birthdays, anniversaries, work promotions, retirement, and other special occasions is best spent with your family and friends. Again, there’s money involved when hosting such events, but you don’t have to break the bank just to show them how much you love and appreciate them. The most important thing is that they know you value having them in your life.

How to Make Room In Your Budget To Spend Money on Yourself

Having a budget makes life easier because it tells you where to put your money. I understand if you need to postpone spending money on yourself when things aren’t looking good financially. You need to focus on living expenses and basic needs first, and that’s okay.

But there are plenty of workarounds so you can make room for the things that are important to you. First, you need to cut back on expenses by identifying the things you spend money on that don’t bring you value.

For example, if you value travel a lot, then you should save money for your trips by cutting down on meaningless expenses. If your work lunches at the cafe cost you money, brown bag your lunch instead and allocate your work lunch budget towards your travel fund.

Cutting back on unnecessary expenses is just one way of saving money. But sometimes, when you have cut back as much as possible, the only way to work with your budget is to try to earn more. That’s why I always suggest getting side hustles or setting up your own business. While running a business or side hustle costs money, the profit can help inflate your savings. Not only that, but it also feels rewarding to be your own boss and earn money on your own terms.

Conclusion

The best things to spend money on are things that bring value and make profound impacts in your life. Some examples are funding your retirement, learning new skills, starting a small business, having enriching experiences, and improving and maintaining health and wellness.

What should you spend your money on to ensure your happiness? The bottom line is that you spend your money how you want to. But if you want to make every dollar count and spend your hard-earned money in the most meaningful way, take another long, hard look at this list and identify the items that resonate strongly with you.

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Best Things to Spend Money On