Spending on [Hidden] Holidays

Does it ever seem like there is ALWAYS a holiday or special occasion right around the corner? I never manage to remember all of the birthdays, Hallmark holidays (Mother's Day, Valentine's Day, etc), or excuses for a party. It seems like there is always a special reason to 'bend' the budget or make an exception. For example, I had the Christmas season all worked out. We had even bought all of our gifts and had them wrapped. Everything was ready except... I forgot my mother-in-law's birthday was a week and a half before Christmas, and we needed to buy a second gift for her. I also picked up a few board games and some snacks to contribute to our family get-together before Christmas. Neither was in my budget. I came across this great article in the NY Times by M.P. Dunleavey that seems to explain the problem of money that disappears. J.D. at Get Rich Slowly also wrote about the article and sees the same problem in his life.

My problem with the article was that many of the 'leaks' in their financial plan were things that I consider reasonable spending. For example, picking up a prescription, volunteering to bring dessert to a dinner party, and buying a birthday gift for a friend. In my opinion, spending money on these types of items is not optional. It is a part of a healthy balanced life. The trick is keeping these types of expenses in balance with the rest of your life. Include them in your budget. For 2008 I plan to add a 'Special Occasion' category to my monthly budget with about $50/week to spend. By adding these lifestyle expenses to my budget I can ensure this does not end up adding to my debt and it forces me to keep everything in balance with my financial goals.

As I've written before I do think that the Big Things are the most important. A $30 a day leak in my finances that did not fit into any budget category becomes a big problem. It does remind me that there is a cross over from where small spending amounts to large sums. But to combat this I do not think it is a good idea to take away your ability to socialize or give gifts. Socially handicapping yourself to get rich later is not the kind of life I aspire to.

For the next few days I will be traveling to my in-laws for Christmas. I'll try to check in and make a few posts; no promises. I'll also be working to leave the plastic in my wallet too. Merry Christmas!