A new road bike, your own kiln for your ceramics, jazz piano lessons, a festival on the other side of Europe. Passions make life richer, but they often cost money. And that is sometimes where it chafes. One time you put off a purchase for months out of guilt; another time you buy something on impulse that throws your budget off balance for weeks.
The good news: you don’t have to choose between your passion and your peace of mind. With a few insights from psychology and a simple structure, you can protect both.
Why spending on your passion feels so mixed
The behavioural economist Richard Thaler (1985) described the idea of mental accounting: in our heads we divide money into pots, even though a euro is simply a euro. That sounds irrational, but you can actually use it to your advantage. If you have a separate pot for your passion, you feel less guilty about spending, because the money is “meant for” that. If you have no pot, every purchase feels like something taken away from the groceries or the savings account.
The kind of passion matters too. Robert Vallerand and colleagues (2003) distinguish harmonious passion, which is freely chosen and fits into your life, from obsessive passion, which feels like an inner compulsion. With the latter, spending more easily grows beyond what you actually want: one more piece of kit, one more upgrade, because it feels as if you will otherwise fall behind. Amateur photographers and guitarists even have an ironic term for it: GAS, gear acquisition syndrome. Not an official diagnosis, but a recognisable pattern.
Where your passion euro goes furthest
Research on money and happiness offers a few useful pointers. Leaf Van Boven and Thomas Gilovich (2003) found that experiences generally give people more lasting satisfaction than material purchases. Elizabeth Dunn, Daniel Gilbert and Timothy Wilson (2011) summarised the research in a number of principles, including: buy many small pleasures rather than one big one, and enjoy the anticipation by delaying a purchase a little.
Applied to your passion, that means: the lesson, the weekend, the competition or simply the time you spend on it often gives you more than the most expensive equipment. That is not a rule against nice things. A good instrument can give years of pleasure. But it helps to ask yourself whether you are buying something for the activity itself, or for the brief feeling of progress a purchase gives you.
Sofie and her dream kiln
Sofie (38) has been throwing pottery in an open studio for six years. She dreamed of having her own kiln, but the price put her off. A few times she was on the verge of buying one on instalments, each time after a frustrating evening in the crowded studio. “Looking back, I was glad I didn’t,” she says. “I would have had a repayment every month for something I had chosen on impulse.”
She chose a different approach. She opened a separate savings account called “Kiln” and set up an automatic transfer of a fixed amount into it every month, the day after payday. She simply kept paying her monthly studio membership from her free budget. In the meantime she read up on models and talked to other potters, and in the end she chose a smaller, cheaper machine than her first choice. When she bought the kiln, it was fully paid for. “The waiting actually made it more fun. And I know the money was there without it coming at the expense of anything else.”
How to fund your passion with peace of mind
- Give your passion its own pot. Decide on a monthly amount that fits alongside your fixed costs and your buffer, and set it aside automatically. What is in the pot, you can spend without guilt. What isn’t, waits. In the budget planner you can give a pot like this a permanent place.
- The basics first. Rent or mortgage, fixed bills, an emergency buffer: these come first. Your passion can grow once the foundations are in place. That protects not only your budget, but also your enjoyment.
- Agree on a waiting rule for big purchases. For example: anything above an amount you choose yourself waits at least thirty days. That way you notice whether it is a genuine wish or a moment of frustration or boredom. The Purchase decision tool helps you weigh up a purchase like this calmly.
- Avoid credit for your hobby. Buying on instalments or with an overdraft facility makes a purchase more expensive because of the interest, and puts an obligation on your future budget. Save up first instead. Think too about second-hand, renting, borrowing or buying together with your club.
- Check the form of your passion now and then. Are you spending more than you planned, and does it feel like having to rather than wanting to? That is no reason to be ashamed, but it is a signal to pause for a moment.
If you regularly sell work or services from your hobby, this can have tax and social security consequences, for example because you may then be regarded as self-employed or as running a business. The rules differ from country to country and depend on your situation. Before you start, find out about the rules in your country, for example from the tax authority or an accountant, so that you don’t face surprises later.
Peace of mind is worth a passion too
Funding your passion is a form of financial self-care. It is not about spending as little as possible, but about consciously making room for what gives you energy, without it costing you your sleep or your relationships. A separate pot, a waiting rule and a solid base mean you can enjoy it wholeheartedly, and that a setback doesn’t immediately put your passion at risk.
Would you like to learn how to build a budget that leaves room for what you love doing? In the online course You can learn to budget you work step by step on a plan that fits your life.