The Art of Deliberate & Skillful Spending
You might be thinking I’m a spendthrift to make such statement.
You are right.
I am. A spendthrift. At heart.
I love spending money especially, on things that give me the greatest value. Read on to find out how to determine the value of your spending.
You might think that this article has no real value for you because either you are a saver or/and you want to save up. But let me tell you, it is this reason why it is more compelling for you to continue reading.
You see, in my perspective, there’s no such thing as saving.
You may say, ‘hey Sok, what about saving money for a maternity leave or a holiday, is that not considered saving!’
‘Yes, it is. But at the end, you will spend the money anyway?’ Hence I view it as spending.
‘Alright. Then, what about investing in stocks or properties?’
‘When you buy a stock or property, do you see your money goes out of your bank account?’
Before, I’d always cringe when I see big chunks of money goes out of my account. I was uncomfortable with the idea of money leaving me. Through many personal reflections, I realized that my view of money is not of a growth mindset!
Here are the things I’ve learned about money and why I propose that we should adopt a spending mindset:
#1 reason — it encourages an abundance mindset
An abundance mindset is believing there is plenty for everyone, according to Stephen Covey*. When you held this belief, you will feel more positive about life and thus you feel more satisfied with life.
Since my maternity leave pay finishes, my mind starts wondering around like a lost child. I thought to myself, whether I could afford anything now since I have no income. Such thinking distorts my perception about my current situations. Soon, I was so dissatisfied about life.
I was unhappy about my circumstances because my mindset mask the truth with lies. Until, I came across a story about a poor mother who rather go without food so that her kids can have something to eat. Only then I realised how fortunate I was.
I begin to practice gratitude as a way to remind myself about my situations. (Click here to read about 10 Steps to Develop an Abundance Mindset).
The outcome can be summed up in the following quote:
‘If you look at what you have in life, you will always have more. If you look at what you don’t have in life, you will never have enough’
Oprah Winfrey.
#2 reason — it allows you to practice non-attachment
‘‘Attachment is the origin, root of suffering; hence it is the cause of suffering.’
The Dalai Lama
Being attached to an outcome, person or feeling is like trying to contain water with your hand. No matter how tight you cupped your hands, it is simply impossible to hold the same amount of water (let alone hold any water in the first place!).
If you adopt a spending mentality, you view money as a free flowing thing. Hence you are less likely to attach yourself or emotions to your money. This way, you are essentially holding water in the cups rather than holding it in your hands. If you want to move water elsewhere, it is easier to do so because you are not in physically near. (Metaphorically speaking.)
#3 reason — it discourages money hoarding
The ugly truth is you cannot out save inflation. Putting whatever you have into a bank account is what you considered as ‘saving’ is to me ‘money hoarding’.
When you hoard stuff, you stop the flow of nature. Everything must change or flow. For example, water changes form through precipitation, evaporation and transpiration.
Lastly, do you know any millionaires save up to become rich?
How to spend money deliberately and skillfully?
Adopting a spending mentality is a good start. But the real magic happens when you put in place the steps to develop skillful spending.
#1 step — spend on what is in your core values
Your core values are the engines that drive your life. Don’t you think what is important to us deserves our attention, effort and money?
To understand what are those forces, follow the below steps:
- List all the things/people in your life that you cannot live without
- Now categorize those items, preferably into less than 5 groups
- Rank them in the order of importance
Such ranking helps you to decide how you divide your money and what to prioritize.
‘We do not have a money problem in America. We have a values or priorities problem.’
Marian Wright Edelman
#2 step — spend on things that will grow in value (and do not take money out of your pocket )
I know that we all like to drive a nice car, and have the latest technology. I’m guilty of this as well. But when it comes to big valued items, the general rule of thumb is to spend it on things that:
- Grow in value over time (click here to find out what are examples of appreciative assets).
- Do not take money out of your pocket. Robert Kiyosaki says to build wealth you need to invest in something that doesn’t take money away from you. Investing in a big house is not really an investment (click here* to get a copy to read more about this)
To help you determine whether an item will grow in value over time, ask yourself:
- What is the likely chance of getting your money back (plus much more) in 5, 10 or 20 years time?
- How scarce is this item? The more scarce the item, the more value it will hold because of the law of demand and supply.
#3 step — spend on things that will give you the most satisfaction in life
Life is too short to live a bad life. Money is not an end in itself but it is a mean. It is a tool that gets work done faster compared to through manually work.
If the item does not fit the first two steps, check whether the following criteria are met or not:
- Healthy — is it promoting or encouraging unhealthy habit or behaviour? For example, playing a video game excessively is not a healthy habit.
- Align with your core value — does it uphold your core values? For example, spending on a leather wallet is not a worthy spend if you believe in animal welfare.
- Within you mean — we live in a buy-now-pay-after era so the big question is, can you afford it? Buying something you can’t afford is like robbing your future self.
Conclusion
In closing, I’d like to say that this art relates to your views on money. A holistic approach to your happiness. Everything connects to each other, in a sense.
‘Money is like an arm or leg. Use it or lose it.’
Henry Ford
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