“Retail therapy” may have a particular ring to it — but the reality is that countless studies have found that experiences actually make people happier than things do.
In 2014, researchers at Cornell University analyzed years of psychological studies on whether people derive more satisfaction from purchasing material things or investing in experiences (PDF, 765KB) Opens in a new window.. Their findings? Experiential purchases form a bigger part of a person's identity, provide more opportunities for growth and ultimately result in greater, longer lasting happiness.
That's why setting financial goals shouldn't be limited to saving for “stuff.” Instead, it should be about identifying experiences that are worth the investment. Here are 3 must-save-for experiences—and how to make them a financial possibility.
1. Go for a physical goal
Getting fit enough to run a triathlon or compete in a weightlifting competition takes motivation, moxie and, let's face it, money. Costs might include hiring a personal trainer, the registration fee for a competition or travelling to a marathon city.
Whether you choose to perfect your backbend or bench press 150% of your bodyweight, saving for a physical goal is an investment worth making. Research shows that improved fitness levels results in higher rates of creativity and productivity at work, as well as lower healthcare costs later in life Opens in a new window..
How to save for it
Physical fitness and financial goals are 2 motivators that can be mutually beneficial. When people reward themselves with as little as a dollar or 2 per day for hitting their daily step count or practicing yoga, they are more likely to continue to exerciseOpens in a new window.. This means that if you put money in a jar each time you train for your physical goal, you're not only more likely to reach it — you're also more likely to save the funds you need it to achieve it.
2. Travel
Investing in travel isn't just about impulsively heading south to an all-inclusive resort — it's about considering how you can reap the most benefits from your time out of office. Experiential travel is also on the rise, making your vacation the perfect time to work toward a physical goal for example, going on a running holiday, learning a new skill, signing up for a cooking school or gaining a deeper understanding of yourself and heading to a wellness retreat. Choose wisely, and you'll see the benefits, from improved cross-cultural competencies that will wow employers, to memories that change the way you interact with the world.
How to save for it
Rather than booking the first deal that comes to your inbox, strategically plan your holiday far in advance. This will give you more time to both save and find lower rates. You may also want to consider enrolling in a travel points program, or applying for a credit card that offers travel rewards or cash back bonusesOpens in a new window..
3. Learn a new skill
That age-old adage that you can't teach an old dog new tricks? It's a little more than an old wives' tale. While it can be easy to assume that children's brains are more elastic and therefore more capable of learning than adults, new studies support the idea that adults are capable of picking up and mastering skills at any age Opens in a new window..
Investing in a marketable new skill can pay dividends. Learning French, for example, may result in better job opportunities. But picking up any new talent can pay off. Joining a knitter's circle, making kombucha or learning how to play guitar all have the potential to widen your social networks. Or aiming high with higher-education is also a worthwhile experience to potentially improve your earning potential.
How to save for it
Kick start your learning by using free online tools, apps or taking lessons from an affordable online tutor. Seek out community groups who may be able to share their trade, or even lend you materials or equipment. Doing so will allow you to foster your new interest, all while buying you time to set aside the money necessary to take it to the next level — whether than means buying a drum kit or signing up for a language immersion program.
Setting experiential goals doesn't have to be complicated — and neither does saving for them. Whether you want to travel the world, learn a new skill or push your fitness to the next level, it's an investment you won't regret.
