How to identify good spending

A lot of my posts here focus on spending. It is the one thing that most of us need to get under control in order to stay ahead and reach our goals. I have gotten into the habit of thinking about the money aspect of everything I do. I have learned the concept of good spending!

It is impossible to avoid spending money. Everything we do has some sort of cost, direct or indirect, attached to it. Good spending is the idea that you spend money in a way that helps you move forward on reaching your goals. Examples of good spending:

• A new desk chair - If you are comfortable you will have less back pain and be more productive. Money is well spent on a good chair!
• Synthetic engine oil - It has been proven that synthetic oil is better for most engines. Extending the life of your car by spending a little more on synthetic oil is good spending.
• Fresh foods - buying fresh is always better for you (and also better tasting) than frozen or processed foods. It has added health benefits which could lower your healthcare costs over time

In order to fully grasp the idea of good spending you also have to define bad spending. I consider it bad spending when I am paying more simply for convenience or on impulse. If it is something I will never use or need it is also bad. Here are some examples:

• Buying because it is "on sale". - If you don't really need the item or items and you are buying simply because the price is low it is still wasteful. Remember it is only a good deal if you will actually need it!
• Buying milk at a gas station - It usually costs a lot more than the supermarket and the product is exactly the same. Spend the extra 5 minutes to go to the supermarket instead and save the money.
• Unplanned purchasing - This is impulse buying. I am a firm believer that 98% of purchases should be premeditated. This means you have thought it over before buying.

I have found recently that I have become afraid of spending. This is bad and counter-productive. I have had to remind myself that their is such a thing as good spending and I have to remember that it cannot be avoided. Look at your buying habits and find the good spending and try to eliminate the bad. This is a good approach to budgeting.