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You ever pulled a Joe Exotic and splurged so badly that you really felt like you were never going to financially recover?

We all like nice things, but sometimes we spend a little too much without thinking about the consequences or how it fits into a wealth-building lifestyle.

Last week was my sister’s birthday. I wanted to do something nice for her, especially since I can’t really see her in this socially-distanced time. So I did the next best thing: I splurged and bought her a gift card to a really nice local restaurant for her boyfriend and her to enjoy.

The problem? I hadn’t budgeted for it.

Here’s something that budget gurus won’t tell you: a splurge isn’t going to stop your wealth-building dreams because wealth building isn’t about being perfect. It’s about making more good financial decisions than bad ones.

What should you do after you splurge? Here are three things to do after your budget blunder:

  1. Splurge on savings. I know, it sounds counter-intuitive – follow up one splurge by making another. But whatever amount you splurge, turn around and make a transfer to your savings account in the exact same amount. After I splurged on that $75 gift card for my sister, I transferred $75 to my savings account.
  2. Pay it off. Don’t accumulate “bad” debt. If you splurged with a credit card, turn around and pay that off right now. And in the future, if you do have to splurge, put it on a debit card instead of a credit card. That way, you won’t end up paying 25 percent interest. My grandpa used to say “pay it and forget it.”
  3. Update your budget. Be proactive and use the splurge as an opportunity to update your budget. Bonus points: Add a discretionary spending category to your budget. Even the President of the United States has one of these – it allows you the flexibility to take care of needs or wants as they arise without hurting your overall budget.

If you incorporate these three tips into habits, you’ll be well on your way to building wealth because you’ll be saving regularly, not accumulating bad debt, and checking on your financial situation regularly. Even without a splurge, if you do those things, you’ll be well on the path to wealth accumulation.

Don’t be Joe Exotic.