Generally, I’m not a fan of click-bait lists, especially when they stray into moralism (thou shalt or thou shalt not!) or leave little room for nuance or the complexities of real life. The topic: “things you should spend your money on” is just the kind of list I will prejudge, and then click on anyway. Just like you, apparently!

Now, most of us don’t need any more help perpetuating our arrival fallacies or justifying impulse purchases. Ad agencies, search engines, and Instagram algorithms already have us figured out. Ask my wife, I have no trouble justifying any number of purchases based on how much time they’ll save, what a great investment they are, or how much better off our lives will be once we have _________. For me, that blank could be filled with a more comfortable sofa, a bigger TV, or a new pair of full-grain leather sneakers (to name just a few fancies from the last week alone). None of these are “bad” things to spend money on per se, but they’re not exactly necessities or lasting solutions to any real problem in our lives.

The Amazon Prime truck that knows my address all too well, has the slogan on the side, “Warning, contents may cause happiness.” But what it really should say is, “Warning, contents unlikely to bring more than a few moments of happiness.” And what’s more, you probably experienced most, if not all, of that happiness when you clicked “Complete Purchase”.

Then there are others whose struggles are in the opposite direction. We all know friends and family members who have plenty of money but have difficulty spending it, even on things that would improve their lives, ease some burden, or add a modicum of comfort or enjoyment. “Penny wise, but pound foolish,” as they say. This list is primarily for those folks whose frugality has strayed into asceticism.

And yet, for those of you who, like me, don’t need any more Amazon Prime packages showing up at your door, the contents of which you’ve already forgotten, perhaps this list can be a helpful reminder of the expenditures we should be prioritizing.

Of course, there are tradeoffs, and no one can have it all. But without any further caveats, here’s the list you’ve been waiting for: 

8 Things You Should Spend Your Money On:

(In no particular order)

1. Health: Physical and mental health are priceless. Unfortunately, there are rarely quick fixes when it comes to your health, despite what your news feed is selling you (One weird trick!) There are many things you can do to improve your health that don’t require much money at all (eating healthier, exercising, investing in community and friendships), but other health expenditures can be quite large and can come with a shock. Few of us are aware of the true cost of healthcare. And yet, your physical and mental health color every aspect of your life, and they are not something to defer or skimp on.   

2. Protecting your family with insurance: If your family relies on you for financial support, you need life insurance and long-term disability insurance. In exchange for paying a monthly or annual premium, these policies will protect your family’s financial future in the event you can no longer work due to illness or injury, or if you pass away. Of course, you hope never to have to use these policies, but they’re an essential part of a financial plan for the peace of mind and security they provide.

3. Things that bring you joy or save you time: Living on a budget, no matter the size, is all about juggling tradeoffs. Even if you feel stretched, think twice before cutting out the things you care about or that make your life easier. For you, it could be your daily latte, your housekeeper, or an evening at the theater or concert hall. Sure, we have to balance “needs” with “wants,” but depriving yourself of all comforts or aids will not be sustainable.

4. Something you’ve diligently saved for: You’ve been saving toward a long-term goal, whether it’s a special vacation, a new car, or a downpayment on a home. For some people, it can be difficult to “pull the trigger” and dip into savings once you reach your target. Savings, while important, is always a means to an end, not the end itself. It’s ok to go ahead and spend, especially when it’s paired with intentionality and is part of an overall plan.

5. Quality products: There are times when the more expensive item is less expensive over time given superior durability or the ability to repair it. When it comes to certain critical things you use every day (shoes, appliances, furniture, tools, building materials), paying a bit more for the superior product can save you in the long run. If the price of the quality item is out of range, try finding it second-hand, or see number four above. However, be wary of faux quality and the law of diminishing returns: sometimes the more expensive item is not any better, or the marginal improvements just aren't worth a big step up in price.

6. Appreciating assets: When you buy something likely to increase in value over time, you are investing, not spending. Yet we often blur the line between spending and investing in our minds. Your new kitchen remodel is not likely to pay for itself in the short run (if ever), and therefore should be viewed as an expenditure, not an investment, (that doesn’t necessarily mean you shouldn’t do it!). Also, highly speculative assets where the risk is very high compared to the potential reward (like Bitcoin, which dropped 64% in 2022!), should probably be avoided or at least limited to a very small portion of your portfolio. The corollary advice is also true, avoid overspending on depreciating assets, those goods that tend to lose value over time, especially if it comes at the expense of savings and investing to meet your other goals. The classic example of a depreciating asset is your car, which is simultaneously an essential tool and a luxury item. There’s nothing wrong with luxury items when they fit into your overall financial plan, just don’t pretend they’re an investment.

7. Other people: There’s been tons of research recently on the benefits of charitable giving or helping out a friend, family member, or stranger in need. The connection between generosity and happiness is strong, especially when there is a personal connection to the recipient or the opportunity to see the specific impact of the gift. According to one study, the effect of charitable giving on personal happiness is roughly the same as the happiness from doubling your income! The positive impact of giving persists when controlling for the giver’s financial situation and is not dependent upon the absolute size of the gift (see the widow's mite, Luke 21:1-4). Giving your time in addition to your money can be even more rewarding, because of the greater connection it creates between the giver and the receiver. For more, see researcher Elizabeth Dunn’s Ted talk Elizabeth Dunn: Helping others makes us happier -- but it matters how we do it | TED Talk

8. Professional help (a shameless plug that also happens to be true): I’m a DIYer by nature, and often to a fault. Paying for professional advice seems like an admission of self-insufficiency or defeat, and I’m not just talking about financial advice. Sometimes the advice feels too expensive, or the benefits too intangible to measure against the cost. The benefits of financial advice are sometimes quantifiable (investment returns, loss avoidance, tax dollars saved), but many benefits are much more difficult to put a dollar value on (peace of mind, achieving a meaningful goal, empowerment, time). The same could be said for any number of professionals where the intangibles are even more difficult to put a price on (e.g. therapists). But the value, both tangible and intangible, can be worth it, especially when the professional has your best interest at heart and takes the time to understand your particular situation and underlying needs. 

So there you have it, eight good uses for the tool that is money. Remember, money is a convenient way to store value, not a value itself.