Perhaps you are one of those lucky ducks who actually has leftover money to spend each month. You’ve paid your essential bills, put money into your savings, paid taxes and insurance, and even invested into your IRA. I’m totally jealous.
But are you putting that leftover money to good use? Do you really ponder where you will spend the rest of your money? If not, I’d say now’s a great time to start.
© denisismagilov / Dollar Photo Club
8 Brilliant Ways to Spend Discretionary Income
I have made up my mind that when our income goes up, I am going to be very picky about what we spend our discretionary income on. In case you are wondering, discretionary income is what you have left after all your necessary bills have been paid. Disposable income, on the other hand, is the money you receive once taxes have been removed. Just letting you know since I was confused myself.
This list of ways to spend discretionary income is full of brilliance because they are all things that will help you lead a more fulfilling life.
Time-Saving Stuff
Photo via Pixabay
I’m just starting to realize that time is way more valuable than money. Purchase items that will help you save time (especially if it costs less than what your time is worth) and you’ll be golden.
Some people have maids because they can make way more money working than cleaning their own home. How I envy these people!! 🙂
I’d personally like to buy some kitchen appliances and tools, get our dishwasher set up, and buy a new computer that will work much faster. They will cost money at first, but over time they will help me spend less time cooking, doing the dishes, and working.
Why It’s a Brilliant Choice: The less time you spend on mundane tasks, the more time you have to increase your income or to spend with family and friends.
Experiences & Memories
Photo via Pixabay
You only have one life to live. Live it well.
Travel, big bucket list items, and even picnics with the family all enrich your life. Whether it’s the landscape, the thrill of a sport, or a special relationship, you will cherish those experiences and memories more than something you can buy at the store. Besides, research shows that spending money on experiences makes people happier than buying things.
I am all for buying journals, video cameras, and making family yearbooks to help keep memories alive. If you are actually doing things in life, even if they are completely free, you will definitely want to document them.
Why It’s a Brilliant Choice: Experiences and memories add value and happiness to your life, not clutter and short spurts of happiness.
Knowledge
Photo via Pixabay
There are so many ways you can gain knowledge for free. For the things that do cost some money, they might just be worth it. College education is a wonderful way to gain more knowledge. An ivy league education, even with its high costs, can actually prove to be super beneficial in today’s economy. But you must be driven and ready to work hard.
We keep the internet in our home not only because I need it for work, but also because it is a wealth of information. Along with the internet, you can access ebooks, too, and even find a lot of free ones that are available in almost any topic under the sun.
Why It’s a Brilliant Choice: Increased knowledge can only lead you to a better life. The more knowledge you have, the more valuable you are as an employee or citizen of this world.
Investments
Photo via Pixabay
Investing your money is the only way it can grow. The smartest people in this world collect interest, not pay it. So if you have money to invest, you will reap the reward later.
Of course all investments come with a risk, but it’s up to you the level of risk you want to take on.
We took a huge risk starting a new business in January. We’re learning that a business requires much attention, patience, and trial and error, and we’re making plenty of mistakes. We need to figure out how to lower expenses so we can keep more of the money we earn and put it back into the company.
Why It’s a Brilliant Choice: Investing your money puts your money to use and often earns you a great return.
Tithing/Charity/Gifts
Photo via Pixabay
Keeping all your money to yourself is both selfish and stupid. When one person is struggling, and you have the means to help them out, give them a hand. They may not turn around and help you out later on, but they will likely turn around and help someone else out when they get the chance. This world needs more people who are ready to help.
It’s also a good idea to use your discretionary income on gifts for others, whether it’s for a wedding, baby, birthday, or just because. Some people speak the love language of gifts, so if this is your spouse, you might have to spend more in this category than some of the others.
Why It’s a Brilliant Choice: It’s nice to share and be an influence for good in this world.
Home Improvement
Photo via Pixabay
When your house feels like home, I believe you will feel happier and more comfortable living there. That is why spending your discretionary income on remodeling your basement, doing yard work, and adding a few coats of paint could be worth it. Even if you don’t love your house, take care of it, and you’ll feel happier to be there.
Why It’s a Brilliant Choice: You can thrive in a home that is comfortable.
Self Improvement
Photo via Pixabay
Taking care of yourself doesn’t necessarily need to cost money, but some things do come at a premium, including real food. Grass-fed beef, free-range chickens, and organic produce are not cheap.
I also think spending some money on exercising can be a good use of your money if you follow through. This might include buying running shoes, getting a pass to your local rec center, or entering a race.
Other things that fall into the self improvement category are clothes, makeup, and haircuts.
Why It’s a Brilliant Choice: When you feel good, you can do more with your time and talents.
Security, Safety, and Emergency Preparedness
Photo via Pixabay
Keeping you and your family safe is a big concern. It’s not easy to spend money in this category, but it’s truly necessary.
You will have to spend money now if you want to be safe in a natural disaster. The most basic of needs – a 72 hour kit – surely doesn’t cost a lot to put together. Beyond that, you will need at least three months of food storage.
If you haven’t put together a will yet, you may want to spend a little money doing that. Depending on your circumstances, you might need a lawyer to help you with that task. Most people can get a will done using a simple form online, and a lot of those don’t cost much.
Car maintenance and repairs are also important to spend money on if you want to be safe on the road and have a car that lasts longer.
Winter is coming, and that means snow for much of the country. Things like rock salt, shovels, car emergency kits, blankets, and food are important to have in case something terrible were to happen.
Why It’s a Brilliant Choice: When you are prepared for the worst, you can live with peace. If the worst does happen, you won’t have to suffer unnecessarily.
I believe everyone should think long and hard about how they will use their leftover money. If you want to be happy and lead a better life, you must make up your mind now about your spending.
How do you spend discretionary income?
- 5 Healthy, Easy, and Fun Halloween Recipes Kids Love - 10.30.24
- 40+ Autumn Comfort Food Meal Ideas for September - 09.02.24
- 40+ Back-to-School Meal Ideas for August - 08.05.24
YES!!! I’ve seen so many articles where the only option for discretionary income is to invest it. I am all for putting money where it will grow… but I also think it’s okay to spend some extra money on other things. Loved this list!
Awesome, Katie! So glad you liked it. 🙂
Love the list – and completely agree with your ideas. I think I’d rank saving/investing first and ‘experiences’ second. I’m a firm believer that we don’t need products to make us happier – but spending money on experiences can seriously increase your quality of life. We don’t really buy ‘things’ but we’ll certainly spend $ on a trip to Turks & Caicos or Mexico… those are memories that will last a lifetime. One thing I would add is ‘debt’ – and maybe this goes with investing… but even once the bills are paid I consider that making the minimum payments. If you have debt you should consider using some of that DI on knocking the debt down!
Thanks, Chris! I guess I should have explained myself better, but I would chunk debt with your necessary bills. If someone is paying off a credit card or a loan, they may not have any discretionary income, especially if they plan to pay it off. Glad you pointed that out. Also, I didn’t put my ideas in order, but I would also put investing first and experiences second. The thing about experiences that I read in the article I linked to is that they become a part of who you are. Stuff cannot necessarily do the same thing. Thanks for visiting and commenting!
Great list! I would definitely diversify and divide it between many options. Investing is always a great option and of course paying off debt as well (if you have any). And let’s be honest, once in awhile it is great to treat yourself as well 🙂
Thanks so much, Reelika! It would be pretty great if I could have zero debt, plenty of money in investments, and still some money to spend on these things. Maybe some day soon!