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How to Keep “Fun Money” from Derailing your Plan

07/12/2023 Written by: Kristine Simmons

Dale Carnegie, one of the 20th century's most recognized authorities on reaching your full potential, argued for the importance of enjoyment in life. "People rarely succeed," he wrote, "unless they have fun in what they are doing."1

Even when you're working toward a goal that requires discipline, such as saving for retirement, you must plan for ways to make it enjoyable. A plan that makes no allowance for fun, including money earmarked for that purpose, is difficult to stick to long term.

Additionally, the whole purpose of a financial plan is to help make your money work for you so you can do the things you think are most important. Your money should serve you. Not the other way around.

Of course, you never want to play with more than you can afford to lose. But even with sensible limits, could there be any harm in risking a little money chasing the potential to get a quick return?

Morey Stettner, a personal finance columnist for MarketWatch, says yes. You might want to think twice about using your fun money for speculation. First of all, he points out, you should recognize that there's a difference between spending money on something you enjoy and simply squandering it.2

Zachary Scott, a certified financial planner, told Stettner that when clients bring up the idea of a "fun money" account they want to use for risky bets like cryptocurrency, he recommends against it. "My definition of fun money is money you literally use to have fun," said Scott. "That means spending it on an experience like a vacation or bucket list item." 

 Let us help you plan for, and fully fund, enjoyable experiences even as you’re saving at a level that requires discipline. Treat your serious money seriously and your fun money intentionally.



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