Sure, nobody NEEDS to go to the movies, go out for dinner, or get their nails done. You can survive without it, as long as you can afford the basics: food, clothing, shelter; right? But having fun is an essential part of living a healthy and full life.
No matter how tight your budget is, you need to set aside a little bit of money to have some fun. Learning how to budget money for fun things is key to treating yourself without feeling guilty or anxious about breaking the bank.
Everyone has a right to spend budget some money for themselves, and nonessentials.
But learning how to budget money for fun things smarter is a must, because if you don’t budget it out, you’ll just spend that money anyway on countless little things:
Pickmeup latte on your break, buying a new outfit before the big event, or drinks with your friend who happened to be those unplanned and unbudgeted expenditures will start to add up, and they’ll give you a nasty surprise when you check your budget at the end of the month and wonder where your money has run off to.
By learning how to budget money for fun things instead of simply spending out of your budget, you’ll find that you can always afford a trip to the mall… but now you’ll be able to actually keep track of that “fun money.”
Here are five simple tips to help you practice how to budget money for the fun things in life:
Give It It’s Own Category in Your Budget System
If you already have a budget in place, then you probably already have it sectioned off into specific categories like “Home Expenses,” for rent, bills, supplies, and repairs. Or “Groceries,” for the staples you stock your fridge with.
You probably also have an “Entertainment” category in your budget. That’s typically where you pull money for things like paying your Netflix account, your weekly date nights with your significant other, and so on. But your Entertainment budget shouldn’t be combined with your If you smush the two budget categories together, it’ll be too easy to overspend on your Entertainment budget without realizing it, and all too quickly. If you have a separate, specific place to stash your extra “Fun” money, then you’ll have a goto budget to draw from whenever the mood unexpectedly strikes.
Let Entertainment be for planned spending. The “Fun” budget will take care of that time where you saw that shiny new thing in the store window and just had to have it. Or when your brother gets his dream job and buy way too many rounds for everyone at the bar to celebrate.
This way, you’ll have a reserve to pull from that’s set aside for those spontaneous moments of selflove spending. By having a specific budget for fun stuff, you won’t have to worry about it affecting your more essential, larger budgets. In short, the Fun budget is what you could call “pocket money.” It’s just some spare cash for whenever you feel like throwing down a bit on something you don’t need, while still sticking to a
Figure Out How Much You Can Afford to Budget on Fun Things
How much money you have to budget for fun things is different for everyone. It depends on where you’re at financially, and how much a toll your other budgets are taking on your finances. If you’re 22 and your main budgets are for living expenses, food, school, and entertainment; then you can probably get away with a respectable funmoney budget, because you have less
If you’re 42 with three kids and one starting college, your fun budget might look a bit different. You’re likely to be more financially established, but you also have more budgets to juggle, and your priorities are probably focused on your savings accounts, college funds, and retirement The first thing you’ll want to do in figuring out how much money to budget for fun things is to take a look at your other budgets, and taking a pulse on your current financial stats.
- Ask yourself some questions like:
- Am I safely out of debt and on track to start saving money?
- Is this fun budget only covering my costs, or is a fun money budget for the entire family?
- Is my Entertainment and other nonessential budgets taking too much of a toll on my
- overall finances at this point, or is it in a good place?
- What’s my income like right now?
- Am I setting aside enough money for my savings funds?
- Can I comfortably keep my spending down to this reasonable amount if I budget this
- much money for fun things?
Make sure you have a plan. Sit down and just work some numbers… if this is how much money you’re making, this is how much you can afford to budget out for fun stuff without it negatively affecting your essentials or savings.
Once you’ve settled on a budget amount, give it a trial run for a few months. Then check back in with your finances. How’d you do? Did you consistently spend within your budget, well below your budget cap, or above it? From there, you can adjust the amount of money you set aside for your fun budget, and maybe use the funds different.
If you find that you’re spending less than you thought you would, go ahead and put some more of that money into something practical if you want. Or you can roll that extra money over into the next month’s Fun budget. Or buy yourself something extravagant. That’s the point of establishing how to budget money for fun things… you can do whatever you want with that
Devote a Percentage of Each Paycheck to Fun OR Add Money Whenever it Rolls
Finding how to budget money for fun things really is simple for everyone (no matter where you’re at financially) because it’s completely customizable. If you’re in a place where you can devote a small percentage of your paycheck (think around 25%) to budgeting money for fun. You’ll end up with a consistently goodsized budget to spend on whatever you fancy, whenever you fancy it. Or… if your income is bit more sporadic and unpredictable, you can simply add money to your fun budget whenever a bit of extra cash rolls in that you don’t have a good use.
If you supplement your fun budget whenever you get a pay bump, or you find a $20 bill on the street, then you’ll have a constantly shifting fun budget that will help set the bar of how much extra money you have to spend that month. Some months the fun budget will be pathetically small, but that’s ok; it’ll let you know that now is the time to be a bit more thrifty. The fun budget will be fat and happy soon enough.
However you decide to add money to your fun budget, remember that it’s not your first priority. Feed the hungriest mouths the money set aside for paying your mortgage or car payments, paying off your debt, and etc first and foremost before you fatten up your budget for fun, splurgy.
Use Your Fun Budget as a Specific Savings Account for Adventures
It’s perfectly fine to have a very small budget for fun, extra expenditures. If your fun budget is $10 per month, then that’s aok. Everyone is in a different place with their financial needs. However, if you have your sights set on something big, then you can learn how to budget by turning your fun fund into a kind of temporary savings account. Your fun budget is basically a piggy bank and for loose change.
But if you want to go to Greece, plan a cruise, pay for skydiving lessons, or buy a crazy pinball machine for your basement, your fun budget can be adapted to make it happen! All you have to do is establish how long it will take to save up enough money to meet your goal. You’ll cut all spending from the fun budget (unless it’s an extreme funemergency, but that means you’ll have to put off your goal that much longer) but continue to put money into the fun budget like you.
You’ll find that you’ll have enough money to do that amazing thing if you turn your funmoney budget into a “fun stuff savings account.” Once you’ve saved up the funds needed, you can smash that metaphorical piggy bank and go hog wild! After you’ve returned victorious for your adventure, you can revert that savings bank back into an everyday fun fund if you want… or you can start saving up for the next big thing. Why not? It’s extra cash!
Your Fun Money Doesn’t Have to Live at the Bank… In Fact, It’s Better if it
While it is absolutely fine to keep your extra fun spending money budget at the bank and just do it all electronically, it might not be the most tangible method. Most of the time, it’s better if you have your fun budget in front of you in physical dollars and cents.
The Dave Ramsey envelope system is perfect for practicing how to budget money for the fun things. Or, like we talked about earlier, you could seriously have an actual piggy bank, change jar, or whatever you use to catch spare cash. Go oldschool gradeschool on this budget thing.
There are several nice benefits to having that fun fund in real cash in an envelope. One being that you’ll never overspend from your allotted amount. This is the only surefire way to never overdraw from any one particular budget. So if you’re living pretty tightly at the moment, it’s better to be safe than not be able to buy groceries, right?
But it’s always good to have physical cash to help you visualize how much you can spend. For example, if you have to dip into the fun fund in order to replace your broken windshield wiper, you’ll be able to clearly see how much you still have left to blow on shoes this month.
This is also a good tactic for using the funmoney budget as a savings account, which we also mentioned earlier. You can see the funds actually adding up. Not only is it extremely exciting, but it’ll help you keep focused and on track to reaching that goal. You’ll be less tempted to pull from that little stack of cash when your mind can recognize it as tangible money that’s going to help you reach your goal of snorkeling with sharks or whatever.
Even If You’re Working Hard to Learn How to Budget Money, Don’t Forget to Have
Budgeting is a lot of work. There’s just no getting around it. It takes up time that you don’t want to be spending staring at your bank statements. But it’s important to budget out the fun stuff just as much as budgeting for the “real” stuff.
Because while you won’t drop dead if you don’t have the newest Playstation system, you’d miss out on whopping your friends in Call of Duty. And although it’s not a pressing necessity to go to Vegas with your old college friends, you’d never get to see them passed out and covered in glitter Living within your means is a must. Saving up for rainy days, emergencies, and old age is critical.
But without indulging in a little fun and throwing around some of that money you work so hard for, what would be the point? Once you’ve mastered the budget basics, you can move on to learning how to budget money for all the fun things that you don’t have to feel guilty about splurging on anymore. It’s ok to have a little fun, and you can do it on a budget!