It is with great pleasure that I reintroduce Clair Schwan of Frugal Living Freedom.  This is second post of a three part guest post from a frequent contributor, Clair Schwan, on spending money.  It is a very timely topic, in that with the holidays, we are all making purchases.  Furthermore, with the economic crunch, we all need to think much harder about our purchases.  Here is the link to Part I, Guest Post: Spending Our Money (Part I)-- Meeting Our Needs

Clair has also composed a four part series on this site about saving money on gasoline usage [Here are the links for his previous posts, Guest Post: Ways to Get More MPG (Part I), Guest Post: Ways to Get More MPG (Part II), Guest Post: Ways to Get More MPG (Part III), and Guest Post: Ways to Get More MPG (Part IV)].  Be sure to check out his site, here is my review, Blog Review: Frugal Living Freedom.  --DDFD

Let's say we've met all of our immediate and near term needs, and it's time to spend a little money on some of our wants.  When you think about it, spending a little "mad money" is one of the pleasures in life.  So, how do we do it without upsetting our financial apple cart?

Here is where we need to be very careful because there is no limit to the things that we can buy, and perhaps our wants are nearly as limitless.  The idea is to strike a balance between making our money go farther, and getting plenty of enjoyment out of life.

Let's look at common "wants" that many people have.  Our list could be lengthy, but I'll keep it short so we don't get lost in the details.  Here are a few items of discretionary spending that many of us would find on our list of "wants":

So, how do we decide what is worthwhile spending money on, and how do we know what is too much to spend?  Much of this depends on the individual, and for each of us the answer will be different.  You have to find your own "comfort zone" that fits in well with your situation and financial objectives.  Let's look at some of the factors we might consider when making such decisions:

Before you spend your hard-earned money, just imagine for a moment that you already have.  Now, ask yourself these questions and see how you feel: