I was looking at various articles to see how other people were recommending to “get out of debt”. I found one that mentioned “rewarding yourself” if you pay something off.
One of the comments to that post was as followed:
“My boyfriend is paying of credit card debt right now. Every time his therapist insists that he needs to set aside a budget for “fun money” every month, I want to strangle her. He doesn’t get the luxury of fun money – he’s in debt, he’s already had his fun!”
While I get where she is coming from, not having “fun money” is more than likely setting her boyfriend up for failure. Trust me, we know this best since we tried the “rice and beans” method and failed miserably.
In fact, even Dave Ramsey himself started to recommend budgeting for fun money. This definitely wasn’t always the case, but the Ramsey team saw how important it was.
Why “Fun Money” is Necessary
Getting out of debt isn’t going to be easy. You NEED to have some fun while doing it. It took Porscha and I 14 months to get out of debt. Can you imagine going 14 months without spending $20 to go spend a cheap night out with some friends? Or telling Porscha she can’t buy that cute dress that she saw at the store until we were debt free…. (that could easily lead to me sleeping on the couch LOL)
How Much Money Should You Budget for “Fun Money”
If you’re wondering how much money you should budget for fun money, the answer is “it depends”. If you’re just starting out, it may be $10/m. As you move forward in your journey, you could increase it.
A lot of it depends on how much debt you’re in and how much income you make. Just remember that every bit you put towards fun will push your debt payoff date back a little.
We recommend to never go over $100/m per adult though. You can do a lot with $100. The goal here isn’t to go crazy.
Kids should have fun money too, but it should only be 1/4 of what you give yourself.
Never Go Over Your Budgeted “Fun Money”
This is the case for any budget category, but especially true for fun money. If you budget yourself $100, you can not go over that amount. Period.
What you can do is not spend all of it that month and let it roll over into the next month. If you see something that you want for $120, then only spend $80 of your fun money this month. When the next month hits, you’ll have your $120.
What About Gifts?
If someone gives you money for Christmas or your birthday, we think it’s OK to put that towards your fun money. It’s a gift, so add it to your existing fun money budget and have some extra fun for yourself!
Obviously the exception to this is if the person giving the gift says they want it to go towards your debt.
