“I’m tired. I’m hungry. And all day, I’ve followed my budget to a tee. To a tee. Hmm… tea. Now, that sounds good. Or maybe coffee. While I’m at it, why not make it a special one. And what’s more special than adding chocolate to it? And whipped cream. It costs extra? Well sure – why not? I'll take an extra shot too! And yes, throw in a scone. Heck, I deserve it.I’ve been good, so I should treat myself.“
I can’t tell you how many times I’ve used ‘treat myself’ as a workable excuse for spending extra money that’s not entirely within my budget. The trouble I get into isn’t necessarily that I’m putting myself into debt over these rewards, but rather that I’m spending money I could be saving for more worthwhile goals — for example a more comfortable emergency fund or a more comfortable retirement plan.
More and more it seems that a job well done equates to a job well rewarded. We are always treating ourselves for even the smallest victories. Small scale (think chocolate bar), or on the larger scale (think iPad) — it’s a habit that’s more than hard to break.
But using purchases as a way to reward short term accomplishments might be hurting you more than you think. Don’t cheat yourself out of future benefits like a comfortable retirement or that trip to Hawaii by taking the immediate rewards system too far.
Play a Game of “Would You Rather”
To start off, play a simple game of comparisons. Put your imagination to work. Would you rather buy a trendy shirt or put put your toes in the sand on a future vacation? Would you rather eat out every single day for lunch, or feel the breeze in your hair as you drive your future dream car?
Instead of focusing on what you’re getting out of the immediate treat, think about what what you might be taking away from your overall goals. A splurge at the department store might mean a new outfit, but those dollars could also have equalled to a substantial contribution to a down payment on your future house.
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Give Yourself Some Credit – But Don’t Depend on Your Credit Card to Do So
Rewards can really become troublesome when they become expected markers of success. In a digital age where finishing up a huge project might simply mean sending a file via e-mail, it it’s become more difficult to get a sense of finality from a simple click of a mouse. Eating a cupcake, on the other hand, sure feels like an easy way to see (and taste) success.
If you think you’ve done well, and if you’re proud of your achievements, then give yourself credit. But don’t let the swipe of plastic take the place of genuine appreciation for your time and effort put forth.
Each time you hand over your credit card to buy a reward, you’re giving your credit card more power than you you’re giving yourself. Don’t cheat yourself out of the power to be the one in control of your finances.
Add Up the Extras
As tempting as it is to simply suggest replacing a reward with a pat on the back, it’s not practical advice. Giving yourself a high-five is definitely not going to taste as good as a triple-decker ice cream sundae. But the frequency of rewards, big or small, can have a serious effect on your finances.
One way to see the impact of all the extra treats is to add them up to a lump sum. Try keeping track of all the purchases you make when you simply feel you deserve a little treat and you might be surprised at the result. Happy hours, coffees, gadgets, clothes – the cost of treating yourself adds up quickly to a more substantial number.
Set Your Sights Out Farther: Make Financial Freedom Your Ultimate Reward
Look at the bigger picture, and ultimately the larger goal: financial freedom. Keeping that in mind as you consider your rewards will refocus your attention (and extra income) on something that’s truly worthy of your savings. Ultimately, by rewarding yourself each time you stay on budget during the week, you’re setting a pattern or habit that directly affects your path to gaining complete financial freedom.
Treating yourself to a nice dinner after a week of eating in might seem like the perfect way to acknowledge financial success, but doing so will also take away from your long-term goal of getting out of debt. In some cases, it can even negate the savings, depending on the cost of the purchase. A reward in the moment adds length to the long run. As with most things in life, it’s about balance, and it’s about compromise.
Though longer term financial goals might seem too far off to be taken seriously, they won’t come to pass any more quickly if you continue to divert funds into rewards based on instant gratification. Bring your far off goal closer to realization by sticking to your plan.
And when the opportunity presents itself and you’re tempted to throw financial caution to the wind once more as you treat yourself, ask one last time:
“Is this treat worth the cheat?”