More and more often I’ve been hearing the phrase “conscious spending.”  But what does it mean?  It’s more than just knowing where your money is going.  It’s about making a conscious decision to spend more money on some things and less on others—in fact really scrimping in some areas to allow yourself to spend more on the things you truly want.

Conscious spending is about defining your priorities and spending your money to best meet those priorities.  It becomes clear to me every time I talk to my friend Heather.  Heather’s top spending priority is travel.  She will cut back in every other area if it means she can take a trip…to anywhere.  I’m exactly the opposite.  I don’t care if I never travel, because my top spending priority is my home.  Home is the place I most want to be, and I do spend a relatively large portion of my money on not only the house itself, but also improving it and decorating it nicely.  That is what is important to me.  I’m content to buy my clothes at Goodwill, drive old cars, and vacation in a tent in a state forest only a few miles from home if it means that when I come home, it’s the home I want.  Heather doesn’t care if she stays in her rental apartment forever, as long as she gets to travel (without sleeping in a tent).  And we are both very happy with our decisions.

Everyone’s spending priorities are different.  For some it’s clothing.  For some it is a car.  For some it is food.  For some it is entertainment.  For many reading this, I suspect it’s education.  But the thing to remember is that you should make that conscious decision about what things are important to you and make a plan that allows you to spend some of your money on those things—even if it means you have to make cuts in areas that are less important to you.

What are the things that are most important to you?  And what are you willing to give up in order to spend your money consciously on the things you most value?