When we started really budgeting in 2020, we switched to You Need A Budget (YNAB) and learned the concept of giving every dollar a job – enter “fun money.” Although this started as a label for our bucket, figuring out what this meant for us as a family has helped us set clear goals and prioritize our spending.
What is “fun money” anyhow?
For our family, we define fun money as the account that funds things outside our typical expenses that brings joy to our family. This include things like:
- Vacations;
- Weekend trips;
- Day trips to the zoo, movies, etc.;
- Kids activities; and
- Annual passes to theme parks, museums, etc.
How we budget our “fun money”:
This is completely up to you! I try to put $100 a month into a general “fun money” account and then budget out the required contributions for planned vacations, annual pass renewals, and kids activities. On months (or years) when we have competing expenses, we supplement with creative uses of gift cards, discounts, points, and strategic vacay spending.
Teaching the kids the “fun money” concept
If you ask either of my girls about why we didn’t do gymnastics and karate or why we were excited to buy Harry Potter robes on Amazon instead of the parks, they’ll both tell you it’s because they chose to use the fun money that way. Sticking to one activity and not doing all the karate upsells means a weekend at Universal. Going to the movie theater with less bells and whistles means mini golf or ice cream afterwards. Kids love choices and I love empowering them early with decisions on how our family spends our money together.
Want to try it out?
Start with figuring out what “fun money” means for your family; and remember, the “money” can be whatever currency you have – actual cash, credit card points, hotel loyalty points, or even time! There are so many free and low cost things you can do, but first you have to figure out what you want to do!
Next, decide on how you’ll account for it – is it a monthly contribution or specific, scheduled vacations and events that you save up for? I highly encourage paying for fun activities before you spend – it’s so nice to come back and not have to worry about the credit card bill.
Finally, look at the reality and decide how to meet your goal:
- Does your budget meet your vision?
- Are there any areas of discretionary spending that you could cut?
- Do you have points or gift cards?
- If you’re short on fun money budget, what can you do for free.
It’s not about the most expensive option – it’s about the most fulfilling one! Comment below and let me know what your family uses their fun money for!
R
Oddly enough honing in on what we WANT, that is not EVERYTHING, is really difficult. So we end up over spending on things we don’t really want. I love the idea of giving every dollar a job.
Yes! Giving every dollar a job is a YNAB concept that I really liked, but had to wrap my head around. It’s intentionality without preset “rules” around spending. The key is doing what works for you! Start by just looking at your spending this month on stuff you’d give the title “fun money” to and look for blog posts coming soon on how I figure out what that bucket actually looks like!