Is it OK to Splurge When You’re in Debt?
July 8, 2010 by Mrs. Frugal
I’ve written a lot about our debt here and every month in my Net Worth and Goals updates. Paying off our debt is our top priority after establishing our Emergency Fund. The thought of being debt free makes me giddy and I’m pretty confident that if we follow our plan we will pay it off by the end of next year.
But I also have a travel bug, always have. If I don’t get out of town at least once, ideally twice, a year I start to go stir crazy. So how does that fit with our debt pay off plan? It doesn’t. I haven’t budgeted for any vacations. But the bug has hit and I’m itching to do something, anything! So what do we do?
When considering anything outside of our budget, I go through this process.
- I figure out what it’s going to cost.
- Can I pay cash or do I have to use credit?
- I look at the impact to our goals.
Once I’ve pulled this together, Mr. Frugal and I assess if it’s worth possibly delaying our debt payoff.
By going through this process we:
- Avoid falling back into poor spending habits by making spur of the moment decisions.
- Spend consciously understanding the impact to our goals.
I think the occasional splurge is fine as long as you are not getting yourself further into debt. Especially if you’ve cut way back and are living on a lean budget, the occasional splurge can help keep you motivated to pursue your goals with enthusiasm.
What do you think? Is it ok to spurge when you’re in debt?
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Personally I think you shouldn’t splurge when you are in debt. It is just wasting money as instead that money could have been used to repay some of the debt which would have also meant saving some interest payment. That gets you ahead as the next month the interest payment is reduced with the saving being able to be used to further reduce the debt. Before you know it you are out of debt. It is then that many people stop and ramp their standard of living. Instead of that if they kept saving at the same rate that they were paying off debt they would then start getting somewhere.
I always think of the interest on debt being the opposite of the miracle of compound interest. I think that then helps focus the mind.
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I think you need to splurge every once in a while to keep your sanity and enjoy life a bit. But a “splurge” to you or me is probably nothing to many other people! So take that trip — you’re going about it the right way. I’m pretty darned sure you’re not talking about a 1-month trip to Europe costing $15,000!
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i dont think it is right to splurge when in debt; you will be getting yourself into bigger problems if you do. Just walk the straight and narrow to a debt free life and after that you will have the freedom to spend on a few things that you want. But om the other hand it makes life interesting to spend on a few unplanned for things but with discipline
To me, it depends on your definition of debt and why you are splurging. For us, all we have left is our mortgage, so I have no problem going on vacation. However, we don’t go into debt to go on vacation, but I am sure that some would rather see that money be spent on paying down the mortgage.
If you have heavy credit card debt and decide to go to Disney because you are in a bad mood, then that is a bad idea. Instead, plan a trip that can be a reward for when you get out of debt.
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You know what? My mind says it’s not right to splurge when you’re in debt. But I do find myself doing this (and it comes with a guilt, I kid you not). I’m terrible when I’m in debt (or really low on funds), I get a bit depressed that I can’t afford things, and then I start to buy things. It’s a disease, I know. And I’m working on it.
Anyway, I think as long as as it doesn’t greatly affect where you are in your plan to become debt-free, I guess it’s okay..For your sanity more than anything else.
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I’m debt free, but I had to sacrifice a few vacation during these past 10 years to do so. And you know what… I regret it!
So if I had the chance to do it again, I would go on your traveling vacation, even it it’s a shorter trip than typical! Especially since the dollar has strengthened (if you going overseas), and because it’s something that you love!
Although, you do have a new baby, so if there was any year to skip the vacation to pay off debt, this would be the one
Drat, I just realized I was no help at all… Whatever you decided, it will be good either way.
I think if you have debt you should concentrate on paying off that debt first, do not misunderstand me; any money you spend on a trip could be used to go towards your debt. Try going to places that are close to home that you have never experienced such as state or national parks where you can pitch a tent and set a fire and cook your own food. Simply because we see hundreds of dollars flying out of our wallets or charging it on our credit cards does not mean it is “fun”. Take the family out to the beach, take long walks on the boardwalk, use this time as “family time” and stop thinking because it is not expensive it won’t be fun.
I think the answer is nope. Splurge in debt means you’ll get more in debt.
Just like eating pizza and ice cream if you’re overweight. Cut it out!
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