Spend it!

Question: My husband and I have been diligently saving for a number of years, and have socked away enough to put down 20% on a house, to replace our ancient car with a new car for cash, and to have about a year worth of emergency savings. We've also put away enough so that before we start a family, we could take a couple of months for an international trip, which our work as professors allows us time to do. We've been diligently paying on our student loans, and owe less than 20K between the two of us. We carry no consumer debt, and have been maxing out our Roth IRAs for a few years, in addition to our tax advantaged retirement accounts through our workplaces.

Now that it's come time to plan for this dream vacation, I am starting to feel terribly guilty about spending part of our savings for something so frivolous. On the other hand, I feel like we've been living well beneath our means so we could do just this. Can you absolve me of my guilt? Thanks! Michelle, Morgantown, WV

Answer: I "absolve" you of your guilt, Go, live your dream vacation. It isn't frivolous spending, but an adventure, an experience for you and your husband to share. As the 15th century French poet Charles D'Orleans wisely wrote: "It's very well to be thrifty, but don't amass a hoard of regrets."

My favorite personal financial planner is the Greek philosopher Aristotle. In one of his lectures gathered together in the Nicomachean Ethics he expounds on his most famous idea, the Golden Mean. It's that desirable although elusive middle between two extremes. The mean "lies between excess and deficiency," says Aristotle. In personal finance, the golden mean lies between saving and spending.

What I really like is that you're spending your money on an experience you'll value for a long time. Have fun!

About the author

Chris Farrell is the economics editor of Marketplace Money.

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