Discretionary Income

Answer 1

We all make a certain amount of money each month. And we all have monthly expenses. If you subtract your expenses from your income, you’re left with what economists call your discretionary income. That is the money that you have left over to spend how you choose. But once the rent is paid and the electric company has been notified that you’d like to keep the lights on this month, what do you do with that discretionary income? Many of us are lured into buying a bunch of stuff we don’t need by the wily advertising execs and marketing professionals who try to convince you that keeping up with the Joneses is your patriotic duty. I try to spend more of my discretionary income on novel experiences and learning new skills. I find these pursuits to be much more fulfilling than trying to keep some kinds of materialistic scorecard. But even that situation presents its own kind of blurred lines. An experience could include dining out, right. When I first became an adult I spent a lot of time and money going out to eat. I think my wife and I eat out more meals than we had at home. This wasn’t good for our wallets and it wasn’t good for our waistlines. That’s not the kind of experiential spending I’m talking about. If you eat out all the time, the experience becomes more commonplace and less novel. There’s nothing special about going out to the local diner for the sixth time that month. To really make a lasting impact consider paring back on the quantity of eating out experiences and try to increase the quality. Imagine if you’d cooked yourself dinner for five of those six meals, and then on the sixth went somewhere really special. You could get a high-quality gourmet meal and a dining experience that otherwise wouldn’t have happened. Or consider doing something healthier with your dollars. If you work a stressful job all week just to earn money, shouldn’t some of that money go towards helping to alleviate some of that stress? Consider treating yourself to a relaxing massage or doing something that you enjoy rather than buying some stuff to cram into a closet or fill your garage with.