Emergency Post -Reassessing Spending Choices: Is what works for you really working?

by Adam on April 16, 2010

I had planned on continuing with the ‘Introduction to Investing series here at Magical Penny but given some recent comments on the blog I’ve been prompted to intervene current programming with an important announcement.

Money is a complicated topic.

  • How you make it.
  • How you spend it.
  • How you save it.

Money is simply an invention to store value and because naturally everyone values their time and materials differently, views on money and value are of course different too.

Each day we make hundreds of choices, many of which have financial implications. We approach each choice with the sum of our past experience and quickly calculate if the options provide us with enough value for our efforts. We live each day the best we can using the sum of knowledge each of us have gained from our days on the planet.

Money is of course only a means: don’t put off life for money

My mission with Magical Penny is to raise your consciousness when it comes to money. It is not to encourage people to avoid spending money or to ‘delay life’, but rather to encourage people to spend money deliberately and with thought.

Do what works for you…

When it comes to reading financial advice we will all come from different perspectives and have different experiences. Some ideas may seem alien to you, or inapplicable to your situation. For example, my recent post on the pit-falls with considering housing as an investment may have seemed to challenge the decisions of someone in a different life-stage who feels owning a house is best for them. But equally another reader may read the article and then re-evaluated their situation and come to the same conclusion that I did: that owning a house in my particular life-stage is not the best thing to do, and that people should not buy a house simply because it’s supposed to be a ‘good investment’. There will always be countless strategies and ‘tips’ to help you grow your pennies but you always have to do what works for you.

Make sure your plan really is working.

That said, there is a danger however of doing “what works for you” –it’s very easy to rationalise your spending patterns by convincing yourself that it ‘works for you’. Examples could be:

  • “I should spend money on this because it makes me happy”
  • “I should buy a house because I’m raising a family”
  • “I need a new car because I value reliability so much”
  • “I don’t need to worry about the little things because I concentrate on the big wins”
  • “Living in squalor now is worth it because of the long terms gains I’ll achieve if I save”

These are all totally valid reasons to justify spending patterns and lifestyle choices. But are they still really valid for you now? Have a think about what you do and don’t spend money on at the moment. Have your values changed?

Sometimes reading different perspectives on money and spending can challenge you to think beyond your own life experiences to better assess the value of a purchase or lifestyle choice. If you have found any Magical Penny article completely off-base as some commenters may have done (*cough* Rightly Knightly *Cough*), then I hope you continue reading articles that challenge you and give you a renewed sense of from where you derive value.

At this point I’m reminded of a Get Rich Slowly article a couple of months ago about the 3 different types of knowledge:

  • What you know
  • What you know you don’t know
  • What you don’t know you don’t know.

My wish for Magical Penny is to contribute to topics that fit into all 3 of these categories for you the reader:

Firstly to challenge you to think about what you already know; to perhaps make you reassess your lifestyle and goals; and secondly to share information with you about topics you may not know much about but would like to, for example how to grow your pennies through investing.

But ultimately I hope at one point you come across an idea or a concept that you didn’t even know that you didn’t know. And it might just make money that little bit less complicated.

Extended reading

While on the subject of learning new things every day below are two brilliant lists of learnings that I’ve come across in the past couple of days. Well worth a read:

101-life-lessons @Ridiculouslyextraordinary

26-life-lessons @ManVsDebt

Want to make me write another emergency post? Leave a comment to make me reassess my own spending,  lifestyle and goals! 🙂

{ 3 comments… read them below or add one }

The Other Adam

Good post Adam, a worthwhile deviation from the investment series!

It comes back to the point I keep making whenever I seem to post (I don’t intend to make it all the time, my points of view just always seem to come back to there!), in that personal finance is PERSONAL. I don’t read this blog and try to take it as gospel truth. I see at as an intelligent (and well read on the subject) persons point of view. I can use it to help form my own conclusions about money, even if that conclusion is that I don’t agree with you and I feel what I am doing is right. Often I agree with what Adam says, and I hope I put that across!

I must admit, I did disagree with your last post on buying property, but not in terms of it being a bad decision or the wrong decision. It’s just not the right decision for me, as much as it is very much the right decision for you. If anything, I enjoyed reading your post because it made me think about the possible alternatives. Then, when I ended up coming to the same conclusion (that I would rather get my house to start my family), it proved to myself that I’d made the right choice for me.

I think while saving is important and it can help you do the things you want to do with your life, it’s important not to save at the expense of what you want to do with your life, otherwise what are you saving for? You’ve covered this in your “Make sure your plan really is working” section. Don’t justify what you are doing to fit in with your spending and saving. Justify your spending and saving to fit in with what you are doing.

Please keep the posts coming Adam, and keep putting your points of view across as strongly as you have been doing. Even though I don’t always agree with your point of view, the day you stop challenging me to think about my saving habits is the day I stop reading!


I’m won back around by Donald Rumsfeld. Loads of your advice is awesome, and i think more consciously now as I manage my spending. It’s just that this still sits alongside my perspective, and so.doesn’t lend itself to any dogmatic judgements.

Rightly Knightly

Feel a bit like i’ve become the villain of the piece but hey-ho!

I think this blog-post is good and necessary as it highlights that you are aware of other situations other than your own current ‘life-stage’. I still maintain your blog is at its best when all ‘life-stages’ can benefit from your advice.

However, I very much like your blog, I find it very useful to touch base with and I would hope I never stop you from knowing what you are doing is damn good.

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