The 'Dirty Word' One Expert Financial Adviser Wants To Rebrand

Here at Money Digest, we frequently opine about the virtues of creating a budget and living within your means. However, to some families, "budget" is something of a dirty word. A killjoy, if you will. Indeed, it's definitely possible to take the concept of budgeting too far. For example, pouring every extra dollar into your retirement account, then having a health issue (or worse) that prevents you from enjoying those hard-earned retirement funds as planned.

In our recent exclusive interview with Lawrence Sprung, CFP, author of "Financial Planning Made Personal," and founder of Mitlin Financial, Sprung declared, "I believe 'budget' doesn't have to be a bad word. You can still find joy in life, whether it's taking a trip, enjoying a cup of coffee, or simply taking a sabbatical. As long as you can afford it and keep your finances on track, do what ... brings you joy."

The fact is, as long as your overall financial habits are healthy, it's okay to splurge every now and then. Think of it like being on a diet. The occasional treat or cheat day can actually help you stick with the weight-loss program. Similarly, treating yourself to an indulgence like a nice vacation or a new electronic gadget can prevent burnout or a distaste for the mere word "budget." That said, you definitely need to set some ground rules that prevent splurging to excess.

As you might be aware, there's a recent trend for consumers to place a higher value on experiences than material possessions. For many, the indulgence of breaking a strict budget could take the form of a dream vacation, a concert or show, or a restaurant meal with friends. Still other consumers might prefer a bit of retail therapy, such as a stylish new article of clothing. Other splurge-worthy items to reward yourself include electronics like a new TV, laptop, or smartphone. Gadgets play such a large part in our lives that a newer or higher-end model is easily justified.

What's most important is to make your limited budget-busters, whatever they may be, count toward your mental health and overall satisfaction in life. Don't simply splurge on the first impulse item that comes along. Instead, start a wish list, which can be as simple as a piece of paper. Alternatively, you could go high-tech by downloading a wish-list app or starting a wish list on Amazon, just to name a few suggestions. When the time comes to splurge, you can reference those lists to determine if you still want the treat or whether it was a passing phase. As a matter of fact, you should make a habit of using similar litmus tests, such as the 24-hour rule, to curb impulse spending in general.

Once your true desire to break your budget for an item or experience has been established, it's time to consider cost. The splurge should be something you can afford without going into any sort of debt. It's okay to use a credit card to make the purchase, so long as you have the funds to pay the statement in full when the time comes. However, by no means should you take out a loan to cover the cost of a splurge.

Instead, some ways for funding life's enjoyments include working overtime or starting a side-hustle second job, then dedicating a portion, like 50%, of that extra income to splurging. Another technique involves dedicating a portion of unexpected financial windfalls to treats. For example, using half of your income tax refund or a work bonus for a fun adventure or purchase.

As Lawrence Sprung told us, "A common misconception is that 'budget' is a dirty word. When you hear 'budget,' you often feel uncomfortable, and sometimes for good reason. Some financial advisers use 'spend shaming' to push families to cut expenses so they can save." To be sure, eliminating debt, building an emergency fund, and investing for retirement are all prudent goals of the utmost priority; however, once you're reasonably on track toward accomplishing those financial milestones, there's nothing wrong with making yourself and your family happy. Responsibly, of course.