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Ramit Sethi Says You Can Spend This Surprising Amount of Money ‘Guilt Free’ – The Motley Fool

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Your monthly budget can include spending money on the things y…….

Image source: Getty Images

Your monthly budget can include spending money on the things you love.


Key points

  • A conscious spending plan includes money each month for guilt-free spending.
  • Aim to dedicate 20% to 35% of your take-home income to guilt-free spending.
  • This includes expenses like entertainment, dining, drinks, and shopping.

Budgeting offers many benefits, including saving money and improving your money management skills. According to financial expert Ramit Sethi, your monthly budget should also include money spent on yourself without guilt or shame. Instead of using whatever funds are leftover after paying bills and other expenses like groceries, gas, and paying off debt, why not include guilt-free spending in your budget?

Sethi advises individuals to include guilt-free spending as a line item as part of a “Conscious Spending Plan.” Keep reading to learn more about this unique way of budgeting and how much to set aside for guilt-free spending each month.

What is guilt-free spending?

Nobody likes spending money on expenses like mortgage or car payments, electric bills, or other utilities. Unfortunately, that’s often part of owning a house or car and being an adult in general. Monthly budgets typically focus on bills, paying down debt, and saving for the future. Guilt-free spending is an additional line item in your budget to enjoy the things you love.

According to Sethi, your budget (which he refers to as a conscious spending plan) should include money you can spend on yourself without shame or guilt. What the money is spent on depends on the person. It could include things like:

  • Trips to restaurants and bars
  • Movies
  • Spa treatments
  • Shoes
  • Clothing
  • Travel
  • Coffee
  • Self-care

Since it’s your money, you get to choose how you spend it.

What is a conscious spending plan?

As the name suggests, a conscious spending plan is a budgeting method that takes an intentional approach to how you spend and save your money. Conscious spending focuses on analyzing your spending habits and then concentrating your efforts on paying bills, saving for retirement, and setting aside money each month for yourself. It allows you to spend money on things you enjoy while aggressively cutting out things you don’t.

Spending buckets</…….

Source: https://www.fool.com/the-ascent/personal-finance/articles/ramit-sethi-says-you-can-spend-this-surprising-amount-of-money-guilt-free/

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