• Many still experienced financial anxiety and spending guilt – overthinking small purchases, worrying about their financial future, micromanaging their expenses;
• Many refused to spend money on things that could significantly improve their quality of life, even if they could easily afford it – investments into physical health, mental health, or relationships;

• Many struggled to spend on things that bring joy – the question “do I really need this?” had whittled life down to the bare necessities, the mundane and routines.

I noticed that focusing only on satisfying your “needs” didn’t necessarily lead to more peace of mind, happiness or contentment. Sometimes, it just led to suppression, deprivation and anxiety.

It turns out that chasing a never-ending list of wants may not bring you happiness, but neither will cutting them all out and reducing your life to the bare minimum.

So how do you find the balance?

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If you tend to err on the side of spending too much on “wants”:

Focus on intentional value-based spending
Spending money isn’t bad, and having desires isn’t wrong. However, learning how to spend money well is a skill in itself. One practice that can be helpful in reducing mindless spending is to get clear on what drives meaning for you personally, and spend in alignment with that. This means getting honest with yourself about why you want the things you say you want. Do you just want them because they’ll get you external validation? Or do they have real meaning for you?

Align your spending with your long-term goals
Having clarity on the vision you have for your life, and the long-term goals that are important to you, will help you ensure that you are spending in ways that add meaningful value to your life. Without clarity on your long-term goals, it’s easy to get caught up in the moment, distracted with emotional spending, and influenced by external factors.

If you tend to err on the side of only spending on your “needs”:

Shift your perspective on what spending means
While we usually talk about return in the context of investments, start thinking about return in the context of spending. Spending is just a value exchange. This means you’re getting something back in return for the money you spend. So, practise noticing the non-financial value of every purchase. Over time, you’ll stop experiencing spending as a “loss” of money, and start being able to enjoy the things you gain from spending too.

Exercise your spending muscle
Those who achieve a level of financial security with frugality practices often have a hard time letting go of the habits and thought patterns they’ve developed over years. It can be difficult to enjoy indulgence and spending when you’re so practised at asking, “Do I really need this?” Unlearning this takes practice. This could look like having a small allocation of money you “force” yourself to spend every month on something that is purely for your enjoyment.

While a lot of financial content pushes you down one extreme or the other – either renouncing materialism and consumerism for a life of simplicity, or chasing growth endlessly – the truth is that neither extreme is healthy, and neither guarantees a sure-fire path to happiness.

The key is striking a balance of both that uniquely fits your goals, preferences and values. Satisfying your needs and giving yourself permission to enjoy the pursuit of your wants are both important ingredients to creating a fulfilling and well-lived life.

Paridhi Jain is the founder of SkilledSmart, which helps adults learn to manage, save and invest their money through financial education courses and classes.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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