Some simple math can help you stop wasting money and start spending it in ways that actually improve your life
- Spend money where you spend time, writes Eric Ravenscraft in The New York Times.
- You should also consider spending money to save time on activities you hate, like cleaning the house.
- Science suggests it will make you happier.
- But most people are more conservative with money than they are with time.
A recent article by Eric Ravenscraft for The New York Times offers a neat strategy for deciding how to spend your money.
Put simply, it's about spending money where you spend the most time. To use Ravenscraft's example, you sleep for roughly one-third of every day (and it affects your overall health) - get yourself a better mattress.But the part of this strategy I really like is spending money so you can spend less time on things you hate. To borrow another of Ravenscraft's examples, you might only spend one hour per week vacuuming - but if you splurge on a really fancy vacuum, you might only have to spend a few minutes on that weekly task.
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This advice jibes with some scientific research on the links between time, money, and happiness. For example, a 2016 study published in the journal Social Psychological and Personality Science found that people who value time over money tend to be happier than people who do the opposite. That's possibly because the first group spends less time working and more time socializing and doing other activities they enjoy.
In other words, you might be happier if you take one hour every week to call a friend instead of clean the house - even if that means making some budget cuts because you shelled out $300 on a super vacuum.
Another study, published 2017 in the journal Proceedings of the National Academy of Sciences, found that people who spend money in order to save time - say, by ordering takeout instead of cooking dinner - are generally happier than those who don't. The benefits of outsourcing chores are especially meaningful for couples, Harvard researchers found.
Spending money to save time can be counterintuitive
Yet few of us are inclined to use money to buy ourselves more time. While we might realize on an intellectual level that time is a finite resource, researchers say we tend to be more conservative with our finances than we are with our leisure.Read more: You'll never build wealth if you can't get over a misconception too many of us have about money
Another piece of this overall strategy is spending money where you want to spend more time. On his blog, I Will Teach You to Be Rich, personal-finance expert Ramit Sethi writes that one way to justify the cost of something expensive is to start dedicating more time to it. That might mean getting into the habit of working out a few times a week before you register for a personal trainer.
Bottom line: You don't have to spend money in traditionally respectable ways, like buying a high-tech kitchen gadget because cooking is #adulting. Instead, spend money in ways that reflect your values. If your goal is to live a full life, then make sure your spending habits line up with what brings you joy.