Where You Should Spend Your Money in 2016

As we get into a brand new year, it’s natural to want to give our lives a financial makeover. Financial planning doesn’t have to be difficult. It should, however, be practical. The best way to be practical about your financial health in 2016 is to just accept that there are going to be some things on which it is a good idea to spend money. Here are a few of them:

Insurance

Take a good look at your insurance policies. In the U.S., we are now required to have health insurance but that doesn’t mean you have to stick with the same provider if the one you have isn’t covering your needs. Spend some time looking for a better plan or talking to your state about your options for Medicaid.

Do this for your auto insurance and home or renters insurance as well. Make sure that if you are a renter, your renters insurance policy is in line with what your landlord requires. The last thing you need this year is for your neighbor’s mistake to land you in the financial hole!

Food

For some weird reason we tend to view high quality food as an extravagance instead of a necessary expense. We tell ourselves that we can get by on ramen and water but the truth is that we can’t. Eating heavily processed foods does more to hurt our health than help us. This year commit to spending money on food that is good for you and helps your body feel better. Believe it or not, this doesn’t have to be expensive! According to Leanne Brown, it is possible to make fantastic and high quality meals for just $4 per day. Commit to a healthier and higher quality diet in 2016.

Clothing

Yes, it is possible to go a year without buying clothing (or buying clothing very cheaply) but hear us out. You will want to, at the very least, update your work wardrobe to keep up with current styles. You’re also likely due for a new pair of shoes. Instead of scrimping on these items, allow yourself to buy high quality clothing and at least one pair of really good shoes. Well made clothing and shoes will last longer than the cheap and worn out stuff you’ll find at secondhand shops and garage sales and you’ll feel better when you wear it. Shop discount racks in department and clothing stores, look online, etc. There are lots of ways to get great clothes without having to take out a second mortgage on your home.

Transportation

If you live in a city with a great public transit system like New York, the San Francisco Bay Area, Portland, etc. great! You probably can get around without a car or a bike just fine. If you do need some wheels, though, it is important that you not just buy the first cheap car you find. Yes, taking out a loan is scary, but a well made car in good condition will be safer, easier to maintain, and last you a lot longer than the cheapie you’ll find on Craigslist.

Fun

Fun is not optional. You need to budget for a few fun things every month like going to a movie, out to dinner, attending a concert, a weekend road trip, etc. If you constantly starve yourself of fun things because they cost money or time, you’ll be more likely to binge spend on impulse purchases and totally wreck your budget. By budgeting in small rewards for staying on track, you’ll be less likely to waver from your spending and savings goals.

The point is: while it is possible to go a year without spending money, you will fare better in both health and spirit if you allow yourself to do some spending. Just make sure you’re spending wisely and you’ll be fine! Have a great year!


Categories: General

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January 10, 2016 Where You Should Spend Your Money in 2016