Why you should have a pocket for wasting money

Hear me out on this one: wasting money is good. At least it can be if you do it right. The trick is to know how much to waste, what to waste it on, and how often to waste it. 

Most saving and budgeting advice centres around a core idea: spend less money, and save more. And that advice is mostly right. You can’t save money if you’re spending too much of it, and the less you spend, the more you can save. 

But saving doesn’t happen in a vacuum, and humans aren’t cold money-counting machines. We’re living beings with feelings and desires. Being constantly disciplined about something is exhausting and more likely to lead to burn-out, which in turn leads us to give up on our financial goals. 

But a certain amount of discipline is also important: if we don’t force ourselves to save at all, we won’t get anywhere either. 

The ideal situation would be a sort of release valve: when the pressure of saving becomes too much, it would let us release a little bit of steam. And that’s exactly what the frivolous pocket is meant to do. 

Spend a little, save a lot 

The frivolous pocket works like this: every month when your paycheck comes in and you put money into your savings, take a little extra, and put it into a separate pocket. Make sure you don’t put in so much that what’s left can’t cover your monthly expenses. 

This pocket will be your escape valve. If you have purchases you know you don’t need to be spending money on, you’ll buy them using money from this pocket. Think of it like an allowance, if you had one as a kid. Back then, if you were lucky, you didn’t have to worry about clothing and feeding yourself. Your allowance was purely there for your enjoyment. And that’s exactly how you should treat this pocket. 

How you decide to use this pocket beyond that is up to you. Like an allowance you might find you get more enjoyment out of letting it grow a little and then buying something large. You might also discover you’d rather spend it on small things constantly, getting a little boost of serotonin without having to worry about your finances. 

Why this works 

Everything we do, from brushing our teeth to figuring out what brand of pasta to buy, requires mental effort. The more discipline a task requires, the bigger the effort. That’s the reason we feel exhausted after a long at work even if we didn’t do much physical activity. Our brains only have so much energy, and every task we add takes up some of that. Even something passive, like not spending, requires energy, because we’re constantly keeping ourselves in check. It’s like balancing on a tightrope: we have to take extra care with every step, in order to not fall off. 

Like with physical activity, occasional periods of rest let our brains relax and replenish our store of mental energy. When your activity is not spending, having a way to safely spend sometimes lets our brains relax, even if just for a bit. That way, we can stay disciplined for longer. 

Like everything we do in life, this idea is meant to help. But don’t be too hard on yourself if you make missteps. Count your successes, no matter how small, and let them inspire you to keep going. There’s no competition, only you and your happiness.