Spend on things you love

Posted by TEBI on October 14, 2020

Spend on things you love


Money is a means to an end, not an end in itself. You shouldn’t save and invest for its own sake; you should do it to fund the life you want to lead.

Throughout his career as a financial adviser, CARL RICHARDS has worked with several clients who had to be persuaded to spend more money than they actually did.

So, how can you prioritise the things you spend on your money on? The key, says Carl, is to work out what’s most important to you.


TEBI: Carl, something you’ve always encouraged people to do is to spend their money on things they really love. Why is that?

CR: One of the things we get in the financial advice industry and, in particular, the personal finance industry, is this idea that we should ruthlessly cut spending. We’re told that it’s about saving and controlling, and we make it painful. We’re even encouraged to use cash so it hurts more!

What I think we really want to do is align our use of capital — in this case, our spending — with what we say is important to us. If we do that, then we want to ruthlessly cut spending on stuff that’s not important, and give ourselves permission to spend extravagantly in other ways. You could say, invest in things that are important!

The best example is experiences. The data and research are pretty clear that we value and remember experiences with people we love far longer than we do objects, or stuff.

Let’s get back to the idea that the goal here is happiness. I want to spend more of my money — as much of my money as possible — on things that bring me lasting happiness. I’d really like to cut ruthlessly my spending on stuff that doesn’t. So that’s my view of budgeting.


What’s an example of something that you have spent your money on that you really loved?

The best examples are experiences with our kids and our family. One example would be a trip that we just went on to the States. We went to Grand Teton National Park, we rented a boat, and we spent five days waterskiing.

When I start adding up the receipts on the credit card bill, I’m like, “Oh, my gosh! We spent so much money!” But I already know that we’ll look around at each other and go, “Would we do it any differently?” No way.

Another example is a friend of mine who writes about food. I had him do this experiment. I said, “Track your spending for 30 days. Not to beat yourself up, but as a tool for awareness.”

After he’d done it, I said, “What did you notice?” And he said “I noticed how much money I spend on food and frankly I was horrified… at first. And then I realised, (a) it’s my job, (b) it’s my job because I love it, and (c) I was with somebody on every one of those occasions, I can remember the conversations, and those will last forever.

He then said, “I actually want to figure out how I can spend less on my utility bills so I can spend more here.”

So again, it’s all about experiences with people you love.


What are your views on buying physical items like clothes, gadgets or cars?

For me, my view of “stuff” has developed over time. I’m a big fan of buying things that last. An example would be my all-weather Arcteryx jacket. Arcteryx is a company that does not make cheap gear.

But my jacket is ten years old now, and it’s both stuff and experiences. There’s patina, emotional patina, with that jacket. If I look around the house, at pictures on the wall, I see the jacket. I can see it in New Zealand, in the Alps, in the Wasatch Mountains of Utah. I know who I was with.

I love the old saying “buy nice or buy twice”. I make the argument that this was less expensive than the three jackets (at least) I would have already worn through.

Another example is a pan that I have that the kids won’t touch because it’s seasoned. It’s taken time to get it seasoned. It’s amazing when I cook meat in it. I cook my steak on it, and it comes right off. That pan was more expensive than the cheap pans we’ve bought, but now we’ve gone through four or five of those cheap pans, because the coating has worn off, and we’ve still got the expensive pan.


What advice would you give to someone who’s reading this who’s holding back from buying something they would really love, and that they can afford to buy?

Let’s say there’s something that you really want to purchase, or maybe an experience that you’d really like to take yourself or your family on. There’s a couple of things you have to go through.

Number one: try letting those things simmer just a little bit, to make sure. We’ve all said, “I’ve got to have that thing!” and then changed our minds. So I keep a wish list on Amazon that I’ve named “the 72-hour bin”. Any book I buy has to go in the 72-hour bin. It’s amazing how many things have gone into the bin that have never come back out, because I had to have it, and then, 72 hours later, it’s faded. So let those things simmer.

Number two: if you can afford it after it’s simmered and you’re sure, then go do it! I’m giving you permission. If you need permission, Carl grants you permission with my little permission granting stick. Go do it!


CARL RICHARDS is a Certified Financial Planner and the founder of Behavior Gap, a communications consultancy for financial advice firms. He is a regular contributor to The New York Times and a frequent keynote speaker.
If you missed the first two part of this series, you can catch up here:

No one sees their blind spots 

Don’t judge people based on money



What are you going to read now? Here are some suggestions:

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What good investing and winemaking have in common

Three reasons why the index advantage will persist

What investors can learn from Moneyball

What do ageing populations mean for your portfolio?

There is such a thing as too much choice

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