The Financial Cost of Telling Yourself ‘I Deserve This’

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There’s nothing wrong with working hard and feeling like you’ve earned the right to spend your money. In fact, on at least some level, that’s a healthy line of thought.

But left unchecked, the simple phrase “I deserve this” can actually become an expensive habit. If you use it too often, you might fall into the habit of justifying all of your excessive spending, and before you know it, you could find yourself in a deep financial hole.

Here’s how those words could end up costing you more than you realize and the steps you can take to prevent that from happening.

Your Emotions Are Targeted

Stress is a powerful reaction that can cause physical harm to your body over time. But it can lead you to make some poor financial choices as well.

When you work too hard or just have a bad day, it’s a normal psychological reaction to feel as if you “deserve” something. Unfortunately, retailers, marketers and credit card companies know this all too well. Have you noticed that ads are drenched in entitlement cues? Expressions like “self-care,” “earned reward” and “treat yourself” are constantly enticing you to spend money on things you feel you deserve.

Of course, none of those ads highlight the fees and costs that come with making these types of decisions. As a result, your spending likely feels justified, rather than discretionary.

The Destruction Lies in the Pattern

It’s true that it won’t kill you if just once in your life you say “I deserve this” and spend money you shouldn’t. But the more you do it, the easier it becomes to rationalize your spending.

Take that morning cup of coffee that you “deserve” because it’s just a small amount, a minor treat that starts your day right. While a $4 morning splurge in and of itself isn’t going to drain your bank account, if you do it every working day of the year, that’s roughly $1,000 out of your pocket. Add in the food delivery you get three times a week because you “deserve” it, and those spontaneous weekend getaways you book because you “never do anything fun,” and you get the idea.

While each of these decisions is small in and of itself, combined, they’re likely costing you thousands of dollars per month.

Impulsive Spending Ruins Budgets

One of the reasons “I deserve it” spending can be so damaging is it’s not accounted for in traditional budgets. While you might have a line item for travel or even for “miscellaneous” spending, it’s unlikely that it will account for every cup of coffee you drink, every takeout order you make or all the “small” weekend trips you take.

Over time, you might find that you’re running a deficit every single month. This is how budgets get ruined and spending turns into a problem.

The Role of Credit Cards

Credit cards offer convenience, and many offer points, cash back or other types of rewards that make their use even more enticing. But the problem with credit cards is that they make it far too easy to turn “I deserve this” into interest-bearing debt. 

Credit card companies are well aware of this. When you use a card to buy something you “deserve,” you get the dopamine hit right away and enjoy the pleasure of the experience. Meanwhile, the financial pain of actually having to pay for that reward doesn’t come for weeks down the road.

If you don’t have the cash available to pay off that debt, it will quietly compound in the background. Over time, even small purchases can turn into long-lasting obligations. With average credit card interest rates exceeding 20% annually, it won’t take too long until you owe more in interest on your purchase than its original cost. 

The True Cost: Lost Opportunity

If your only indulgence is a daily coffee, you might think that isn’t much to spend on something you deserve.

But remember that every dollar you justify with entitlement spending is a dollar that you can’t use for financially prudent options like paying down high-interest debt, building an emergency fund or contributing to a retirement account.

If, for example, you bought a $4 coffee every working day of the year for five years, that’s over $5,000 in missed savings or investments.

The Bottom Line: How To Reward Yourself Without Causing Financial Damage

This isn’t to say that you shouldn’t spend any money at all on “I deserve this” moments. After all, deprivation could lead to even more impulsive spending. But you have to strike a careful balance between discretionary purchases and preserving your lifelong financial security.

Here are some strategies that can work:

• Budget for “spontaneity”: Although you may not always know when the urge will strike, prepare for when it does. Build guilt-free spending into your budget on purpose — but then, stick to it.
• Wait: A classic way to defuse impulse spending is to force yourself to wait 24 or 48 hours before you spend over a certain amount. You may find that many of your “urgent” purchases lose steam after that cooling-off period.
• Reward yourself for accomplishments, not emotions: If you tie “reward spending” to actual accomplishments, such as getting a promotion at work, paying off debt or hitting a savings goal, this can encourage continued progress instead of undermining it.

If all else fails, ask yourself this question: Will this purchase still feel worth it when I see my monthly statement? That’s the true financial cost of telling yourself “I deserve this.” 

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