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How to Eliminate Aspirational Spending

How to Eliminate Aspirational Spending

What is aspirational spending? It's spending that reflects what we want to do or who we want to be at some unspecified point in our future. The dangerous quality of aspirational spending is that it often feels virtuous. In the moment, it may even make us feel as though we are advancing toward some of our goals.

This is the very reason that it is so problematic: It’s sneaky. It’s a big deception, and it's robbing you of your ability to fund the life you truly want.

Aspirational spending is the thought that says, “If I buy the stuff, then the skills, or the fun, or the adventure will follow.” Unfortunately, the reality is the opposite – when we spend on “stuff,” we use up the money that could have been put toward our actual goals.

Take a look around your home. How many books do you own that you still haven’t read? Do you have unused workout equipment or a brand-new yoga mat still in its package, tucked away under your bed? What about the art supplies in the back of your closet, or the guitar gathering dust in the spare room?

If any of this rings true, then you could have a problem: Your aspirational spending may be interfering with your ability to get ahead financially.

Here are my top tips to keep aspirational spending from guzzling up your money.

Start small.

Reach the absolute limit of how far you can get with what you already have before making a purchase. Start the hobby, save for the trip, or learn the skill first. The purchase should come from a need created by an activity. Purchasing "stuff" in the hopes that simply owning equipment or materials will magically lead to progress is a path to disappointment.

[Related: Trust, Transparency & Triumph: Talking About Your Family’s Future]

Explore low-cost options.

Make use of libraries, co-ops, and rental places wherever possible. Also remember that in some cases, friends and family may be willing to lend equipment or materials, or even join you if you’re trying to take up a new hobby or learn a new skill. Why pay for something when you can borrow it or get it for free? An added bonus of this is less clutter.

Stick to a spending plan that is built around your short- and long-term goals. If it’s not in the spending plan, don’t buy it.

[Related: How Many Bucks Are You Spending at Starbucks?]

Schedule smart.

My number-one tip for curbing your aspirational spending is this: Make a spot in your schedule for reading, or learning, or adventure, and then  stick to it. Things that get scheduled become priorities, and therefore get accomplished.

Financial planning and scheduling are closely related. In the case of aspirational spending, the missing link is time. If you find that you can’t make time for something, then that probably means that even though you’d love to do it eventually, it’s not high enough on the priority list for you to do it right now. And that’s okay. Getting realistic about what we have time to do now and what needs to go on our bucket list can be a huge source of peace.

If it’s something that you care about enough to put on your schedule, then it may be something that also deserves a spot in your spending plan. The two often work hand-in-hand. Part of financial planning is using the money you earn to strike a balance between funding a life you love now and in the future. It’s about helping you prioritize and spend intentionally in ways that truly matter and make your life satisfying.

[Related: Your Checklist-Style Guide To Becoming Financially Responsible]

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Natasha Knox is a CFP® professional on the west coast of Canada. Her company, Pax Planning, helps high-income earners get more life from the money they earn.


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