One of the best personal finance tricks I learned is to set a Guilt Free Spending number.

Shout out to Ramit Sethi, author/founder of I Will Teach You To Be Rich, for this one.

The principle is quite simple. Have a dollar amount that you know you can spend guilt-free without ever thinking about it. Want that Rolex? or YSL purse? If it’s within your guilt-free number, go get it.

Calculating is just as simple.

1. Write down your net income.
2. Subtract all your necessary expenses (mortgage, loans, utilities, internet, etc).
3. Subtract all of your investments and savings.

And what you’re left with is a “Guilt Free Spending” number.

Personally, I just recently spent 6 months of my guilt free spending on one item— a pop-up camper for my car. And it was the best feeling to buy this knowing that all my expenses, investments, and savings are already taken care of. And that’s the power.