Saving The Windfall

Windfall - a large amount of money that is won or received unexpectedly.

Even though I'm a boring person who prefers to stick to routines, I definitely welcome those spontaneous windfalls.

However, I don't tend to spend this kind of money - money that I don't expect to have. 

I didn't spend my bonus last year.

I didn't spend the $600 from the Resilience Budget in April

I didn't spend any other gift money received over festive seasons, birthdays, or tokens of appreciation.

They all went straight to my savings accounts, waiting to be deployed when the right opportunities arise.

Some of my friends are surprised at this. They found me weird to not get presents or reward for myself when I receive a bonus or gift money. They thought I was 'in need of money' that's why I'm depriving myself of all those spendings joy, but they didn't understand that I don't derive joy from spending money on stuff I don't need. I didn't even buy the idea of saving half of it and go spending the remaining half.

I took some time to reflect on why I have such an attitude towards windfalls and collected my thoughts in this post.

First of all, I don't spend them since I don't really have big-ticket items in mind that I must buy. The one that I really want, i.e. a house, is still out of the league for me. I already have a lot of stuff that was accumulated over the years and they are still in working condition. If they aren't I will try to fix them before consider getting a replacement.

I also had some exposure to marketing when I was younger and therefore understood the tactics they use to manipulate people's feelings and then their wallets, so I understand it could be really difficult to resist the seduction. Read this to see how I battled my shopping monster. 

My advice is 1) Calculate the compounded value over the years and see if you still think it's worth it, and 2) If you can't resist the temptation, make them irrelevant.

Secondly, anything that I need or reasonably want, I should be already able to afford them with my income minus the mandatory savings, which means that I never need to touch the windfall to get what I want. 

In case I can't pay for it after deducting the savings from my take-home pay, I will consider if this is something that I could afford or really need after all. If so, I will just save up over a few months for it rather than laying my hands on the windfall. This is called 'delay gratification'. And if you can live without it for a few months, you probably can live without it for years.

Thirdly, I don't have the thoughts of 'I have been working so hard throughout the year, I should reward myself'' and I could never understand it. Yes, I worked hard, but that's expected of me because I'm paid to work and I want to succeed in my career. All the time and effort I have put in is to have a better future for myself, so the outcome itself is already a reward for my journey.

Lastly, I'm quite satisfied with life. Of course, I think my life could definitely get better, which is why I'm working hard towards my financial goals, but I don't feel deprived or have the need to fill a void with stuff. I am able to manage my emotions and I don't leave myself feeling upset or negative for long. I don't see a point in crying over spilt milk. If milk is spilt, you need to clean it up and go out to get more milk or deal with not having milk at all. Perhaps that's why I don't see the need to buy things to 'cheer me up' or 'reward myself' or 'make me happy'. You don't need to offer unhealthy ice cream to comfort a kid if he/she is not sad at all.

That's it from me on why I don't feel any resistance in saving windfalls. Do you think I'm too uptight with myself after all? How did you manage the $600 from the government? What do you usually do with your bonus at the end of the year? Do you strategise a plan to spend them, or save/spend all of them? Please let me know what you think and many thanks for reading