How to Treat Yourself on a Tight Budget

Ways to Enjoy Life Without Spending Too Much Money

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It’s important to treat yourself from time to time for your own mental health and happiness. Not budgeting for indulgences, however, can take a toll on your financial situation if you’re not careful. Luckily, there are ways to treat yourself and keep your finances in check even if you’re on a tight budget. 

What Does It Mean to Treat Yourself?

“When you treat yourself, you do something that time and money doesn’t permit on a regular basis,” Paul Gaudio, certified financial planner (CFP) at Bryn Mawr Trust, told The Balance via email. It’s an activity or purchase you enjoy every once in a while, rather than every day.

It can mean a variety of things, many of which don’t cost any money at all.

“For example, you can turn off your phone, read, write, or simply relax on the couch,” Mike Kayes, certified financial advisor (CFA) at Willingdon Wealth Management, told The Balance via email. “Given that many days can be busy and stressful, you may find quiet time to be a refreshing treat.”

When Is It OK to Indulge?

While it may be OK for your friend to indulge whenever they want, it may make more sense for you to do so weekly or monthly.

There is no one-size-fits-all answer to how often it’s OK to indulge as it all depends on the price tag of your “treats,” your income, your budget, and your long-term financial goals.

“For me to feel at ease indulging, I have to sacrifice first,” Kayes said. “As a decathlete, I monitor my diet very closely, but I also love ice cream. So, I eat ice cream once a week to ‘indulge’ when I’d prefer to consume it every day.”

Kayes strongly believes that, while indulgences don’t have to cost a lot, they should involve sacrifice first. Setting aside funds for a more costly indulgence like a weekend getaway or a fancy meal outfits a sacrifice such as working overtime, picking up a side gig, or paying off a debt first. The more you sacrifice, the bigger and more frequent your indulgences may be.

How to Budget for Your Indulgences

To budget for your indulgences, set and prioritize financial goals first, such as paying down high-interest credit card debt and student loans, or simply paying all of your monthly bills before spending any other money. Understand where you currently are and where you hope to be in the future so you can determine the ideal budget for your situation. 

“Once you look at your income and expenses, you'll uncover how much you can allocate toward indulgences while still staying on target to reach your goals,” David Abate, CFP at Strategic Wealth Partners, told The Balance in an email. Abate suggested a few budgeting methods, including:

  • Pay yourself first: Calculate the monthly savings you need to reach your financial goals. Next, pay yourself first by automatically depositing that amount in a bank account directly from your paycheck. After you account for fixed costs like housing and transportation, you can use the remaining dollars toward your highest priority discretionary expenses. This method can ensure your habits properly align with your goals.    
  • Envelope method: Placing money into envelopes with different categories like groceries, gas, and indulgences is a great idea. Then, only spend the money you have in that envelope for that category every month. The envelope method can give you a sense of empowerment and allow you to allocate your funds based on your priorities. 

Another budgeting method that may be right for you is the 50/20/30 budget, which can help you allocate your monthly take-home pay toward necessities, savings, and your wants (indulgences).

Tips for Treating Yourself on a Tight Budget

There are a variety of ways you can treat yourself on a tight budget. Abate recommended that you get creative and think about lower-cost alternatives that don’t make you feel like you’re sacrificing too much. 

  • Organize a book club: Instead of spending a lot of money on social activities with loved ones, start a book club where members can meet in-person or virtually to discuss a book and enjoy their favorite food and drinks together.
  • Visit a park: There are many town, county, and national parks throughout the U.S., most of which allow free entry. Visit a local one every so often to get some fresh air and immerse yourself in beautiful views. 
  • Volunteer: Meet new people and give back to your community through volunteer activities. You can volunteer at an animal shelter, soup kitchen, or local nonprofit organization.
  • Relax in a hot bath: After a long, hard day, take a hot bath and listen to your favorite music. This way you can unwind and relax in the comfort of your own home without spending a dime. 
  • Buy a quality coffee machine: If you’re tempted to go through the Starbucks drive-thru every day for a latte, invest in a quality coffee machine instead and prepare drinks at home.

The Bottom Line

Remember that it’s OK to indulge. In fact, doing so can keep you sane and happy without compromising your finances. Just make sure you budget accordingly for your indulgences. If there is no room in your budget for indulgence, alter it so that you’re not spending as much on other expenses.