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How We Spend When We Splurge

I’ve got a reputation for being overly frugal, and it’s well deserved. I’ve earned it. Yet, there are also decreasingly rare times when we splurge a little.

Yes, I’ve admitted to cutting my own hair and even my wife’s hair at her insistence. Saving money feels good and it feels right. Wasting money is painful; I was raised to be a good steward of the money I’ve made and frivolous purchases simply do not sit well with me.

However, at times, we choose to be less thrifty. I dare say there are times that we are anything but frugal.

To be honest, learning to spend money and be OK with it is something I’m working on. Frugality can be a beneficial quality — it helped us reach early financial independence — but an associated scarcity mindset can also be something of a hindrance to living a joyful life with a sense of abundance.



Spending With Intention to Overcome Excessive Frugality


Overspending is a more common and more damaging problem as compared to “underspending,” but when someone has pinched pennies for decades, it can be difficult to break thrifty habits that have become ingrained.

Reframing a purchase as having an investment component is one way to ease the sting of spending serious money. I can’t imagine spending $10,000 or more on a wristwatch or handbag, but when shown how certain makes have actually appreciated in value, you can see how it’s not necessarily money down the drain.

A major kitchen makeover, new composite decking, patio, pergola, or bathroom upgrade? You’ll spend tens of thousands of dollars on these things, but you will likely recoup at least some of the cost when the time comes to sell your home.

The same can even be said of certain artwork, fine wine, and even whiskey if you can resist the temptation to crack the bottles open and partake.

Splurging for the sole sake of spending more money isn’t going to bring joy to a lifelong saver. Immersion therapy might be an effective approach with certain phobias but I can’t see it working for those with an aversion to extravagance.

One ought to spend, or slurge, with specific goals in mind. Goals like happiness, memories, safety, convenience, and peace of mind. I keep goals like these in mind when choosing where and when to upgrade from the budget option I may have chosen a decade ago.

These are some of the ways we spend when we splurge.




When I say we splurge on travel, it’s more about quantity than it is 4-star or 5-star experiences. Pre-pandemic, we had plans to spend most of the year traveling. With a family that will be fully vaccinated by the end of November, we have plans to be away from home for all but about 5 weeks over the next 5+ months.

It would be much cheaper to stay home, but there’s a great big world out there, and we’d like for our children to see as much of it as they can before we settle down for their high school years.

The term “well-rounded” is rather nebulous, but I do feel that spending time in dozens of different nations will give our kids (and us) a global perspective that can’t be gleaned from history books or documentaries, as much as we like those resources, too.

Travel is often exciting, fun, and it can also be terribly inconvenient and challenging. Jet lag, language barriers, lost and forgotten items, last-minute cancellations and delays… you learn to expect the unexpected. As you work through difficulties, you learn to be resourceful,  resilient, and develop life skills that can help you navigate future crises.

Back to the splurging part. While we’re pretty adept at budget travel, I have been selecting modest upgrades for recent bookings.

For example, we’re currently wrapping up a cruise to Cozumel and a private island in the Bahamas. The four of us could have shared an interior stateroom for about $1,200 plus gratuities. For about an extra $140 a day, there was a room more than twice the size, situated directly at the front of the 9th deck with two huge windows facing forward over the ship’s bow. I booked it.

As we return to Orlando, our hotel room is a suite twice the size of the standard rooms offered. For an extra $15, it was a no-brainer, but like the cruise line upgrade, it’s one I probably wouldn’t have made a decade ago.

Financial independence has helped me realize that we can afford to have nice things.




While we do love to spread our wings more often than most, it’s also nice to put down roots in a comfortable place, too.

Coming from a guy who bought a $90,000 house a couple of years ago, you might have a hard time taking me seriously, but hey, that was temporary.

This fall, we’ve spent time and money to improve the lakefront lot on which we plan to build Dreamhome #2. Dreamhome #1 was built in 2007 and 2008. I looked at what we spent back then, and adjusted for inflation the $650,000 or so we spent would be like spending closer to $850,000 today, and this was in a place where many  homes could be had for under $65,000, and a $165,000 would get you a respectable home in a better part of town.

By the time we’ve built Dreamhome #2, we’ll have spent well over a million dollars. If we choose to sell the house across the street, where we’re living now, I think we’ll still have over a net 7 figures into the new home, but we might just keep our current house as a guest house and short-term rental.

We’ll have more house than we need, especially once the kids fly the coop, but that’s alright. This is one of those areas in which we’re okay splurging.




While I do believe that public education can be excellent in many locales, and it’s essentially all my wife and I have personally known, education is an area in which I have been willing to spend.

To date, it’s been mostly in the form of a musical education. We own three digital pianos, two ukeleles, a guitar, a banjo, and countless books full of sheet music for all of these instruments. Private lessons generally don’t come cheap, either, although we’re currently able to get those via the public school system when we’re in town.

While I not-so-secretly hope our kids choose an in-state public school for their college educations, we’ve been saving in 529 Plans since birth and will be able to afford private or out-of-state public school tuition if that seems to be the best option for either or both of our sons.

My undergraduate and medical school education led me to a rewarding and lucrative career as an anesthesiologist; I want my kids to be able to take full advantage of whatever educational opportunities arise for them. It’s also reasonable to think of that money spent as an investment, as well, as there is a definite return on money spent towards education.




If you read much about wise ways to spend your money, you’re probably bored with the “spend on experiences, not things” trope, so I won’t belabor the point. Yes, you’ll probably get more joy from experiences and the anticipation of them than you will from most things, but things can also lead to experiences, memories, and fun.

On this cruise, we kinda, sorta splurged on a stingray and shark experience, but that’s mainly because purchaing an offical cruise line sanctioned shore excursion was the only way to get our partially-vaccinated 11-year old off the boat in Mexico.

I can tell you that I’ve skimped on experiences in the past, and I’ve probably regretted doing that more often than I’ve felt upset for having wasted money on an experience that wasn’t worth it.

I now pay nearly $100 a seat for a pair of tickets to Golden Gophers football, despite the fact that I live over 600 miles away and the team just isn’t that good most of the time. It’s worth it to me for the experience of keeping in better touch with family and friends back in Minnesota, and the tailgating, at which I drink…



The Good Beer


Life’s too short to drink cheap beer. Insert wine, rum, whiskey, coffee, bud, etc… or whatever your vice of choice may be. You can also splurge on healthy food and drink, as well.




Jimmy Fallon is credited as having thanked craft breweries for making his drinking problem seem like a really neat hobby. I resemble that mark, and I’ve also splurged a bit on brewing and serving equipment for my homebrewing hobby.

That’s another activity that has helped me make quick friends when new in town, as has the curling hobby I developed in Minnesota and hope to resume when we start spending winters in northern Michigan.

Last year, I introduced my boys and reintroduced myself to the non-frugal hobby of downhill skiing. That was something we could do together as a family, making it money well spent.

My most expensive hobby might be digital photography. I learned the hard way that it becomes even more expensive when you leave all of your gear on an airplane under the seat in front of you. These things happen.

Splurging on hobbies often leads to new connections and friendships, and having hobbies you enjoy can make the transition to retirement life much easier.




The first few times I read Shel Silverstein’s The Giving Tree to my kids, I had to pause to gather myself and keep the tears welling up from spilling over. That darned tree is just so selfless, giving everything it has to make that boy happy ’til the “boy” is old and frail and needs nothing more than a place to sit, which is precisely what all that remains of the giving tree can provide.

Behavioral science has found that we are happier when we spend money on others than when we spend on ourselves. Our tax code also incentivizes certain types of giving, and paying lower taxes makes me happy, even if it means I give a dollar to save thirty to forty cents.

Aside from the home we’re about to build, charitable giving has been our biggest splurge in recent years. Since starting a donor advised fund in 2013, we’ve given a mid-six-figure sum to our DAFs and have made a low six-figure sum in grants from them to various charities.

It feels wonderful to be in a position to make these gifts without impacting our own financial future. My hope is that we can continue to grow this charitable endowment while continuing to give more from it in the coming years. There are only so many ways I am comfortable splurging on myself and my family.

As we’ve done for several years now, we’ll be making 100+ grants to charitable organizations based on reader requests on Giving Tuesday at the end of this month.

If you’ve got a DAF, I invite you to join me in making a minimum of 10 grants of $100 each to select charities. If that’s something you’re willing and able to do, please contact me. We’ve already had several volunteers but would love more!



What do you splurge on? How do you differentiate between frivolous spending and a justifiable splurge?

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18 thoughts on “How We Spend When We Splurge”

  1. Subscribe to get more great content like this, an awesome spreadsheet, and more!
  2. I think I’m quite OK with spending / splurging in bursts, like on vacation/travel like you say.

    I’m frugal the rest of the year, so as long as the money works, I’m OK buying a $2K jacket or an expensive watch and stuff like that.

    I think I don’t have a binary “save $ all the way” or “go luxe all the way” mentality because I know the time I get to splurge on 5-star restaurants, etc. is severely limited to how much vacation time I have, which isn’t much. So the damage I can do to my account is actually quite limited.

    Another reason why I might not mind splurging on things like art or whatever is because I already invest in stocks and real estate and things like that. So what’s $3K on an art piece from a good artist whose work is shown to appreciate over time vs. wiring $100K to a fund that’ll yield 10-20% IRR on a syndication?

    Likewise for my jacket example, I bought a $1.6K jacket after tax rebates (huge splurge for me because I normally buy uniqlo or below) in Italy, but the market rate in the US is $3K. So even with splurges I’ve got resale value in mind — if I want a new jacket or don’t want this anymore, I’ll just do a sale at $2K, for example. I also don’t feel guilty about this purchase because I might buy new clothes once every…many years, so when amortized out it’s not much money.

  3. On the spending on colleges bit – you may want to do some more digging into how much you’d need to save. You may be surprised. My family just sent our oldest to college – holy cow, how the time flies! – and there are many things I now know that I didn’t know before. One of the biggest surprises is how colleges outside of the tippy-top-tier seem to base their net cost (ie sticker price minus scholarship money) on the cost of your local State U. Of the 10 colleges my kid got into (public and private), most of them gave him “merit aid” that put the net cost to us at around our State U’s cost – with higher-stats kids getting more merit aid (so lower than State U), and lower-stat kids getting less. Targeting the 4-year “all in” price for your local State U should put you pretty close to what you’ll need overall (assuming Harvard is off the table), even if your kid doesn’t go the State U route. (If he/she even can – those State U’s can be extremely competitive nowadays, not like it was when we were growing up.) Lots of things to learn in that space when you get older.

  4. Thanks for this article, doc! I have struggled with frugality turning into cheapness for years, and it is a habit I have been working to break (as discussed in my Crossroads 007 interview). For me, learning to allow myself to buy small luxuries that bring me joy in the present has been wonderful. While I never let food or travel be reduced, I did with other passions. Interestingly, I tried the immersion therapy route by blowing some money and it did help to a degree, but it was because it was on items that I found value in. Nevertheless, a lot of the help has come from making deliberate choices to say yes on things that provide lasting happiness.

  5. I do like this post, but at the risk of getting off topic I must vehemently disagree with you regarding “The Giving Tree”. That story sends a terrible message, and if I do decide to introduce it to my kids, it will be accompanied by a long conversation about values and character.

    • Totally agree! I hate this book with the fire of a thousand suns. Do I think my girls need me to reinforce the message they already get from society that they should give all of themselves over to others until they’re a withered, useless stump? I. Do. Not.

  6. We are living our retired lives on less than half of what we can safely spend. But we live rich lives, traveling for tennis, fishing, hiking, running and off roading. Honestly we have a terrible time coming up with anything we want for Christmas or birthdays. We have good gear for all our hobbies and it only needs replacement infrequently. We are trying to push our frugal boundaries but when you never feel deprived it seems weird to force more spending.

    • Maybe slightly off topic, but I think I’m developing an affinity to a new and expensive hobby- sailing 🙁
      And that’s in addition to other not-super-cheap hobbies, like triathlon, windsurfing and tennis… So I was wondering if one needs to plan for such “eventualities” in accumulation phase of things.

  7. Good read, thanks. We’re loosening the purse strings as well. Travel and food are big areas. Also saying “yes” to all the little $10-50 things that we can easily afford.

    On the travel front, I’m always looking for those small incremental boosts where $10-20/day on lodging, car rental, meals, etc brings way more than $10-20 worth of value. Example: a much nicer view in a weekly airbnb, or a 2nd bathroom for our fam of 5, or a third (for fourth!) bedroom so each kid has more space. None of those expenses are the kind of thing I’ll look back on in 10-20 yrs and regret spending $ on.

    • Those are excellent ways to get more value for the money, while still traveling affordably.

      For us today, it was spending $25 to check in at 9:30 a.m. to our hotel suite rather than waiting until sometime in the afternoon. We could have just checked our bags in and gone to Universal for the day, but instead we got settled, walked to the grocery store, got laundry done, etc…


  8. A neat venn diagram I heard about the other day: one circle is “people you love” and the other is “experiences.” Where they overlap is: “spend money here.”

  9. The things I have no problem splurging on are food and travel.

    Both have given me lasting memories that trump any material purchases I have done to date.

    Excursions from cruises etc can be very expensive but again it adds to the memories making them truly priceless.

    It is hard to switch on the spending gene after saving for so long but you have to draw a line between enjoying life and being the richest person in the cemetery

    • I have mixed thoughts on the food splurge. I do enjoy a good meal, but I wouldn’t call myself a foodie — fine dining’s not really my thing, so I don’t find a lot of value in it. But that’s just me; I know plenty of people who think nothing of dropping hundreds on a meal for two.


  10. I've got my 2 acres of non-leveraged, crop-producing, cashflowing farmland via AcreTrader. Get yours.
  11. You lost me at homes. I thought frigatlity and the 4% rule got you to FI at such a young age. Your lake house #1 cost what my only house does and you are building a second? Generational wealth? None of this follows your advice to date.

    • I may not have explained our situation as well as I should have. Or maybe we’re going a little overboard.

      Our first Dreamhome was supposed to be our forever home, but once my employer — the only hospital within 45 minutes of us — went belly up, living there was no longer an option.

      We are now down to one home after buying our current place (a 50-year old single story ranch with basement) and selling two places earlier this year. The house we’re living in is across the street from the lake and it came with a wonderful lot on the lake. So we plan to build on that lot next year. We’re undecided on whether or not we’ll keep the house we’re in. There are some advantages to keeping it, and could be an income source as a short-term rental.

      Whataver we decide to do, we’ll be down to one property with one or two homes on it, and one of them will be nice and new.



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