Successfully Budgeting for Fun

by Kevin on September 14, 2009

I am a firm believer in budgeting. Last week I told you to use a flexible budget rather than a “carved into stone” mentality.

Part of our budget includes spending money for each of us. Many couples fight over money. Things like “You’re spending too much money on shoes!” and “You spent too much money at the game on Saturday!”

Compare the common theme of money fights in marriage to our personal situation: I can’t recall a single huge money fight in our marriage.

How to Not Fight Over Money

Our ability to not fight over money revolves around two things:

  • we set up our budget together
  • we budgeted equal amounts of fun money for each person individually

That’s it.

We were on the same page as we brought the budget together and set up our goals. This keeps us from fighting about how much we’re spending on groceries and eating out.

But I want to tell you about the second part today — budgeting for fun.

How to Budget for Fun

Budgeting for fun isn’t just setting aside a lump sum of money that you can both dip into. I’ve seen that tried and not really work out. You still end up with “Hey, you spent more money than I did last month. That’s not fair!”

Instead this is what our budget has setup. My wife and I each get a very small percentage of our net income for the month in spending money. We track it along with everything else on a spreadsheet. If we don’t spend the money it just piles up. So if you want to save for something you could not use money for three months and then buy something.

This system has worked beautifully for us. If my wife wants to spend all of her money on clothing and shoes (something I don’t find a ton of value in) I can’t say anything about it. And it isn’t a problem unless she spends more money than she has in her “account”.

The same is true for me. If I want to spend my money on car parts or computer games… that’s fine. As long as I stay within how much money I currently have to spend.

An Example of Using My Fun Money

I’m the kind of guy that doesn’t spend his money a lot. I guess that’s why I write a personal finance blog.

A little more than two years ago I purchased a 1978 BMW 320 — a classic two door coupe. Over the past two years I literally did nothing to the car while I finished up my MBA degree. Being busy with my degree kept me from dropping large amounts of cash on anything and my spending account started to build up.

I decided to use some of that money and bought some new tires for the BMW. I had purchased wheels about 18 months ago (again when I had more money piled up) and didn’t do anything. So I splurged on a couple of parts and some tires, and had the tires put on the wheels Friday night.

I spent a big chunk of Saturday morning jacking up the car, and with the help of my wife (holding down the brake pedal) swapped out the wheels. This is the result — and I’m stoked!

Before (click for full size):
Old tires with tire rot that were severely out of balance. (My arms would shake from 40 to 70 mph.)

After (click for full size):
New tires although the wheels aren’t balanced. I got them installed at Wal-Mart which admittedly made me a bit nervous, but they did a great inexpensive job. They were out of the little wheel weights needed to balance the wheels perfectly. Even without being balanced perfectly the car drives so much better.

You’ve got to budget in some fun in your life. This is what I do with my fun money. What do you use your fun money for?

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SingleGuyMoney September 14, 2009 at 4:31 pm

My fun money is for electronics!!! I have my eye on a new Blu-ray player and I plan to get one real soon.

By the way, is that your house in that second photo??

Kevin September 14, 2009 at 6:39 pm

That would be awesome if it were my house. It’s not! It’s an office building in our neighborhood.

Regarding the Blu-ray player… we’re holding off on that simply because I think within 3-5 years we will all be streaming/downloading movies directly to the TV. I don’t think we will need discs fairly soon.

Ricky September 15, 2009 at 6:52 am

The wheels look great sir! So are you ready to run a few hot laps at Barber now?

Pat September 15, 2009 at 8:27 pm

Love the car! I’m looking at some used BMWs as well. How did u find that beauty?

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