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When is it Okay to Spend Money?

So, I’ve been in college for a few months now and I’m really struggling mentally with my personal finances. Mainly:
When is spending money justified? What counts as a luxury vs acceptable comfort?

I’m on a very generous meal plan that provides all meals + $10/day of “flex dollars”- a huge sunk cost
I’ve also allotted myself $50/month for extra stuff (ie groceries, meds, books, fun)

  • I sometimes want food (ie halo top, dining out) not provided by the meal plan (which meets my nutritional requirements) but since I have the meal plan, should I be spending on unnecessary groceries even if it fits my budget?
  • I can afford to indulge in fancy coffees from the cafe with my flex dollars but don’t because I don’t want to create bad habits for when I don’t have that luxury. When is it acceptable to spend on fancy, overpriced drinks? Is once a week too frequent?
  • my classmates all seem to have no qualms about buying extra snacks. It makes me kind of question my own reservations about spending

My parents haven’t been very helpful because when I ask them if it’s okay, they just say “spend the money!” or “we give you an allowance (far higher than the $50) for a reason!”

This feels like a “what are my priorities” question, and I don’t think anyone else can answer that for you. You need to decide what you prioritise in life and make your decisions accordingly.


Just to expand on this after reading @T3hPwnisher post, it feels like your main aim is to develop good budgeting skills and sound financial habits. Your actions however seem to be around saving as much money as possible, and these aren’t the same thing.


I’d say this is pretty helpful: they’re telling you when exactly to spend the money.

You’re in college right now. It’s sort’ve an adult purgatory. You’re kinda one, but you’re also kinda not one. Developing good spending habits is a fine idea, but you’re also operating off of allowances and meal plans rather than an actual stable income you’d have if you had gainful employment.

Your parents want you to focus on having a college experience and getting good grades right now: NOT pondering if it’s worth spending the extra 18 cents to buy the name brand pudding. That’s a gift parents want to give their children. I’m hoping my child will be able to have the same gift when they’re in college.

Let your parents give you that gift.


It’s okay to buy groceries, snacks, and a Latte.
It’s not okay to buy meth, heroine or whatever the designer drug of the day is.



Well, I just want to make sure I’m not being wasteful/extravagant


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That’s smart and sensible. How are you defining what’s wasteful and what’s valuable in terms of your “big picture” goals?

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That’s kind of what I’m struggling with. The extra expenses seem “extravagant” right now because I don’t need them given my situation w/ the meal plan

The lattes seem “extravagant” because in the future, when they aren’t a sunk cost, there are more efficient alternatives (ie buying bulk coffee at home)

You probably don’t need a mattress either, but I think we all agree your “big picture” goals would be compromised if you didn’t have one.

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Everybody has their own threshold for austerity vs. indulgence.

Its reasonable to have decent presentable clothing, hygiene, food, basic self care stuff to look good and feel good.

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So how should I go about determining an appropriate threshold?

Buy living life and experiencing it.

Let’s say you over-indulge in your spending. That will eventually result in a point-in-time when there is an expenditure that you’d want to take on, but you do not have the funds to do so. That is life telling you that you’ve over-indulged and that it’s time to scale back. This is akin to when you push yourself too hard in the gym, or diet too harshly, eventually something fights back. With training too hard, you’ll see lethargy, injuries, etcetera. With financials, you’ll end up owing someone money, or not being able to afford to do/purchase something (whether that is an experience, an item, or paying a bill).

Now, if you do not want to make these mistakes just to learn the lesson, that too is fine - but it isn’t necessary to err so much on the side of caution that you miss out on the richness that life has to offer. No-one can give you a general rule that will be guaranteed to work, hell, for all we know the next financial crisis might be around that corner and none of us will be having a jolly good time for years to come but for the sake of argument approach it the same way you would approach healthy nutrition meaning that rather than eating clean 90% of the time, spend wisely 90% of the time.

If a fancy coffee drink, such as a latte, is something that you’d enjoy then by all means you should treat yourself to one once in a while. You can set aside 10% of your money for these kinds of expenses every month, and whatever is left over at the end of the month you either let spill-over into the next month or you use that money to be generous (if that makes you feel good). Ideas: invite friends over for a home-cooked meal, invite your parents out to dinner, give to charity. Or, spend those remaining dimes and dollars on yourself. Maybe get some new chalk, it doesn’t matter. Use the money to enrich your life in a way that you see fit.

Whenever you spend money in an indulgent way, acknowledge it to yourself, by all means but do not let that stand in the way of your enjoyment of the thing. By doing this rarely, you won’t run the risk of habitualising it (exception: drugs, alchohol, …) and hopefully you might derive some extra enjoyment out of these years.

I’d never consider an expense in the grocery store to be unjustified if it’s put towards quality nutritional choices. Buy local produce, and locally sourced meats. Buy things that are in season. Buy things that taste good. Nutrition is what fuels you, and by extension, your success.

If you want any financial advice with regards to saving, I have but one: when your income increases - put the increase instantly towards your savings (stocks, etc.). Once you go “up” in lifestyle it is very painful to go back. This presumes a certain level of contentness with your current quality of life, of course.

Lastly, it is very easy to spend a little money, rather than a lot of money, and get very near the thing that is so expensive while paying a fraction of the cost. I like tasty coffee drinks too, but by buying some cinnamon, cardemom, cocoa-powder, and ground-up ginger I can get very near the experience of buying a campus luxury-drink and have an entire thermos of it.

If you find yourself justifying an exceptional indulgence by using a period of perceived suffering–its probably out of whack. That’s more of an emotional decision.

If you say for example, "At the end of the month if I have $ X. Xx saved/invested, $Y. Yy covered for necessities (even some nicetys) then I’ll go to Zzzz place and use this much for coffee/special item, etc.

The first one is a rationalization based on emotion, the second is a benefit of structure and discipline.

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Thanks for the advice!

Funnily enough, I’ve actually hears buying local and in season as a money saving hack!

Hmm, good point! Maybe I should just set aside a part of my budget (like 10%) for luxuries

That seems reasonable.

In fact, unless I’m reading it all wrong, you might want to make that a mandatory expenditure.

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Local, not necessarily, in-season most definitely. But it’s still good advice, whatever is in season is usually more nutritious.


Cool, thanks so much!
How does this sound:
10% savings, 80% necessities ( meds, supplies etc), 10% luxuries (latte, snacks)

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That looks pretty reasonable, or at least a good starting point. You can shift those around a little if you find yourself with either too much cushion on necessities or not enough.

Now figure out a time period–weekly, bi-weekly, monthly–to adhere to.

Weekly might be nice to get the habit set, then bi-weekly to become acclimated, then monthly as the working model.