Are You Living ‘For Now’ or Prioritizing the Future? Why Having Money Doesn’t Mean You Can Afford to Spend It

I was going to help my mother buy a dress. I am getting married next month and she wants to wear something fabulous for the wedding.

Last Saturday we spent hours diligently scouring the aisles looking for outfits in her style (fun but elegant, comfortable enough for a disco dance). I walked back and forth between the shop floors and fitting rooms, bringing her a myriad of sizes and colours to try on.

I was completely focused on our shared mission until a cream wool jacket on sale caught my eye and distracted me. I couldn’t resist putting it on.

And while I was hesitating about buying it (yes, it has nice buttons, but do I really need another jacket?), my mother said encouragingly, ‘Well, go ahead – you can afford it.’

That got me thinking: what does that innocent-sounding statement actually mean? There are times when the answer is very clear: if you don’t have enough money in the bank to pay for something, you can’t afford it.

But if you’re lucky enough not to have every penny available, the answer is much more difficult.

In my case, buying that coat doesn’t mean I have to give up something else now. But it does mean that later I won’t have the £60 it cost to pay for something. After all, you can only spend it once.

The challenge is to balance a tangible purchase in the present (the coat) with something hypothetical in the future (wedding shoes, a bigger mortgage, even my own retirement – ​​who knows?).

As my colleague Jessica Beard describes on the previous page, professional footballers are often very bad at finding this balance.

Countless players have made the mistake of living extravagantly for a few years, only to have to scrimp for the rest of their lives.

But they have a more extreme version of the “can I afford it” dilemma than most of us will ever encounter.

In essence, they receive almost all of their lifetime income at once – no wonder they struggle to figure out how much to spend and what to save. They also fall into the same trap that I know most of us do: believing that the times when your income is highest must coincide with the times when you spend the most.

When you earn money, it is far too easy to find a lifestyle that fits your income. But later you may really need the money.

The budgeting challenge faced by footballers is extreme, but not so different from what we all face in retirement. We spend decades building up savings and pensions, and in most cases receive a steady income. Then retirement comes with a screeching gear change and instead of a steady income, many of us have all the money we will ever have for the rest of our lives in one go.

It is up to us to figure out how to spend our pension pots over an unknown number of retirement years. So what is the solution? How do we determine what we can really afford?

We all have different attitudes. We all dance somewhere on a spectrum that ranges between ‘live in the moment and treat yourself now’ and ‘don’t buy it unless it’s essential because you never know what’s coming’.

Where we sit on that continuum is partly determined by our upbringing and the attitudes toward money we absorb at a young age, and partly shaped by the messages we see around us.

Of course, most advertisements are very reassuring about the value of living now. Few talk about the benefits of restraint and setting priorities for the future.

The challenge is to understand where our beliefs about money come from. Then we can make them serve us well – or we can work to resist them.

Rules can also be useful so that we don’t have to think about what to give up in the future when we are in doubt about buying a new coat.

In my case, that means I put aside a certain amount of money each month before I spend a single cent on fun things. I try to make sure I’m taken care of in the future first.

Fiona Bruce, the Antiques Roadshow presenter, said in an interview last week that she started saving for a private pension when she joined the BBC because she didn’t believe she would be able to keep her job after she turned 50.

She is now 60 and still working, but I doubt she regrets starting the pension scheme.

I bought the jacket – and some moth spray. And we found my mother a beautiful turquoise pleated jumpsuit.

As she handed over her debit card at the cash register, she confided, “I never bought outfits for special occasions. I thought, ‘What a waste to spend money on something you’re only going to wear once or twice.’ But then your grandma told me, ‘You’re only going to do it once, so it’s worth doing it right.'”

Oh, the stories we tell ourselves – and each other – to convince ourselves we can or can’t afford something.

I’d love to hear yours: the stories you tell yourself to decide whether or not to spend money.

Rachel.rickard@mailonsunday.co.uk

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