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money isn’t the same in my head

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Isn’t it funny how not all money is the same?

Now I know with my intellectual maths graduate brain that money is fungible - which is just a fancy way of saying that it’s all the same. £1 is worth £1, and $1 is worth $1.

But you wouldn’t think it to look at how I actually work. I own a house which currently requires:

  • a small repair to the roof
  • containment of the little shop of horrors backyard ivy
  • gas fires removing
  • maybe damp sorting out in the bathroom
  • a new bathroom suite
  • insulation in the loft
  • a new front door

But, I went out and spent 2 years worth of earnings from this blog on a new (to me) oboe. Which is fine, because the oboe purchase makes me happy, but not so much, because it never occurred to me to spend the money on the house. In my head, I’d allocated blog money to the oboe fund and it couldn’t be spent on another purchase.

a useful mindset

In some ways, the idea that some money is different can be very useful. It can stop you from impulse spending money that’s set aside for another purpose. It can help you keep track of your goals.

In my case, whilst I didn’t need the oboe as much as I need to make repairs to the house, it was the first thing that I’ve really saved up for. As far as my learning and playing was concerned, I’d progressed well beyond the capabilities of the oboe that I was borrowing. Spending the money on a more sensible purchase would probably have been more grown up, but I’m not really all that grown up at heart. It didn’t work out too badly - at least I have something to show for my efforts.

or less than helpful?

On the other hand, if I’d thought about it, maybe I could have managed to squeeze out a new bathroom instead of the oboe (plus little shop of horrors and damp work which would be prerequisites). By not considering the money fungible, I didn’t give myself a chance to make that decision. I stuck to the idea that I had last summer, without re-evaluating.

This time, it hasn’t been the end of the world. Even if I’d thought about it, I might well have bought the oboe rather than been more sensible. Next time I might not be so lucky.

Do you tend to think of money as all the same, or as each pot having a specific purpose? Let me know in the comments.

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20 comments for “money isn’t the same in my head”

  1. You’re the only person I know who has… an oboe fund… :-)

    Posted by shadox | June 26, 2009, 3:14 am
  2. I totally do this… DH doesn’t understand why I get so irritated when something stupid happens and our travel fund has to become the emergency fund. He thinks I’m being rigid and stubborn, because he figures money is money, but I have had the funds all categorized in my head and when something screws it up, I get frustrated!!

    Congrats on your oboe. Although it may not be the most practical purchase compared to the house repairs, it will feed your soul and mind as you improve your musical skills. It’s so rewarding to buy the thing you’ve been saving up for.

    Posted by psychsarah | June 26, 2009, 1:15 pm
  3. @shadox: Really? I’m quite surprised.

    Posted by plonkee | June 26, 2009, 4:43 pm
  4. Congratulations on the new oboe, you’ve been saving for it ever since I first read your blog I think. You deserve it!

    Posted by Monevator | June 27, 2009, 2:37 pm
  5. Enjoyed the article! The mindset of allocating certain money for certain things is basically a form of strategic financial planning!

    I do it all the time, setting up various funds to save for long term goals. :-)

    And don’t beat yourself up for subconsciously choosing the oboe over the bathroom. Just start a new savings fund!

    My two cents (after taxes),

    Len Penzo dot Com

    Posted by Len Penzo | June 27, 2009, 4:29 pm
  6. For the most part, money is money is money in my spending habits. But like Shadox, in my saving habits, every bit of money has its place and purpose. That’s not to say it can’t ever move from one fund to another, but certain funds are inviolable.

    Long term savings, for example, must remain untouched unless a dire emergency threatens. Otherwise, the expenditures must be covered by the short term savings accounts. At the end of the day, it’s all my cash, but it feels right to have it properly allocated.

    Posted by Revanche | June 30, 2009, 1:52 am
  7. I think it is a good idea to set money aside in ‘pots’ for what it should be spent on. It makes it a lot easier to save that way.

    Posted by Property Investing | July 1, 2009, 6:59 pm
  8. I did that with a violin. Great decision, I think. :) There were other things I could have done with the money–but I worked for it for a violin and it really meant a lot to me and my music. Even though I only played it regularly for the next 4 years, I think it was totally worth it and I still go through spells where I practice (apartment living unnerves me a bit).

    Posted by Mrs. Micah | July 6, 2009, 1:40 am
  9. I really appreciate that you spend your valuable 2 years on this blog to earn required money but your hard work worth. such things changes view of money!!! Agree..

    Posted by Healthcare Management | July 17, 2009, 12:33 pm
  10. Wow, pricey oboe?

    Posted by Phi | July 18, 2009, 12:11 am
  11. I have those little clay pots you can buy online that say things like, “My 40th birthday fund” or “My New York fund” and I now have 11 of them for different things and each one holds about £500 I think. I live my life by them and my family think I’m obsessed :)

    Posted by mark harrison | July 20, 2009, 9:18 am
  12. @Mark Harrison, that’s so sweet! On the other hand, if anyone was to rob your house it would be like a seen from Ali Baba and the 40 Thieves.. :)

    Posted by Monevator | July 31, 2009, 12:32 pm
  13. One way I conceptualize money is by determining how long it would take me to work in order to afford the purchase of a certain item. That usually scares me straight!

    Posted by cd rates | August 25, 2009, 1:06 am
  14. First time even think about that money also can be different and value of money can be dissimilar.

    Posted by Title Insurance Florida | September 2, 2009, 7:12 am
  15. Well done on making enough from your blog to pay for the oboe and i think it is good to get a tangible reward like in your case the oboe rather than the less exciting loft installation for achieving something special like in your case the money that your efforts creating and updating the blog have produced.

    Posted by James | September 19, 2009, 7:39 pm
  16. I used to be a big impulse spender until I moved in with my girlfriend. We now have pots for EVERYTHING, and I know I’ll be in big trouble if they are not spent on their intended purpose!

    Posted by Scott Casey | June 15, 2010, 2:37 pm
  17. every bit of money has its place and purpose. That’s not to say it can’t ever move from one fund to another, but certain funds are inviolable.

    Posted by commercial printing | November 1, 2010, 11:26 am
  18. It’s a good mindset strategy. Bank accounts got on the bankwagon a long time ago, by offering customers many accounts to better ‘organise’ their money

    Posted by George Thistle | November 19, 2010, 10:45 am

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