Achieving the right balance between accumulating wealth for a secure future and spending to enjoy life today is key to successful financial planning.
Research suggests that once you reach a certain level of income ($75,000, according to psychologist and economist Daniel Kahneman), focusing on wealth alone can actually reduce happiness.
As you may have read in the recent article about peniaphobia , it’s easier than you may think to avoid spending in favour of saving. Over time, this can lead to missed experiences, delayed plans, and a sense that life is permanently “on hold”.
At Ascenta, we believe financial success isn’t about becoming miserably rich. It’s about using wealth as a tool to support a fulfilling, well-lived life – both now and in the future.
As the old adage says, there’s little point in being the richest man in the cemetery. The key to financial confidence is understanding how to adopt a healthy spending mindset while still keeping an eye on the future.
These five steps could help you strike a healthy balance between saving and spending in 2026.
1. Get to grips with your budget
Understanding how much you spend, where your money goes, and what genuinely adds value to your life can give you greater clarity about your finances and allow you to spend with confidence.
A clear, documented budget helps you distinguish between:
- Spending that supports your lifestyle and wellbeing
- Spending that’s habitual or provides little value
- Savings that are purposeful.
Keeping track of your income, outgoings, and disposable income can prevent you from guessing how much you can save or spend each month, instilling confidence so you can relax and enjoy life without worrying about the sums adding up.
2. Keep cash on hand for an emergency
We typically recommend holding between three and six months’ normal expenditure in an easy access bank account. However, if you’re self-employed or have multiple financial dependants, you may want to hold up to 12 months’ ready cash.
With a comfortable financial buffer in place, it can be easier to remain invested for the long term, as well as spend on experiences and goals, without worrying.
3. Know what you’re saving for
You’re more likely to stick to a saving or investing plan if you know what you’re saving for.
Without a goal, you could easily let your money trickle away by spending without much thought.
Read more: Why life goals are crucial when plotting your financial plan
The start of the year is an ideal time to review or make new plans, allowing you to focus on what truly matters.
Your goals will likely be determined by your stage in life. For example, you may be saving to:
- Enjoy financial independence
- Take early or phased retirement
- Help family get on the property ladder
- Buy a second home
- Travel the world.
Not only does a focused saving plan help you achieve your target, but setting goals could also highlight when you’ve done enough.
Without defined goals, it’s easy to keep saving indefinitely, even when you have enough wealth to fund the life you want.
4. Visualise your financial future with cashflow modelling
Cashflow modelling is one of the key tools we use to help clients reach their goals.
It can be used to illustrate how life decisions, such as retiring early or increasing investments, could affect your financial future. As such, it can be especially useful to help you plan your retirement with confidence, or to understand how gifting wealth to your children during your lifetime may affect your financial security.
Wherever you are on your financial planning journey, cashflow modelling can help you understand if your aspirations are within reach. If not, we can advise you on how you could adjust your plan, showing you when and how you might achieve your goals.
5. Protect your legacy – and enjoy it
For many families, estate planning isn’t only about what happens after you’re gone; it’s also about giving while living: supporting loved ones, creating shared experiences, and using wealth to make a positive impact during your lifetime.
This might include:
- Prioritising experiences over accumulation
- Structuring assets to mitigate future Inheritance Tax
- Helping children or grandchildren while you can see the benefit.
Ultimately, the memories that tend to matter most revolve around people – time spent with family, friends, and the experiences you’ve shared together.
Finding balance with confidence
Knowing when you’ve accumulated “enough” isn’t always straightforward — particularly when you’re a busy and successful expat with a complex financial picture.
That’s why ongoing planning, regular reviews, and a clear understanding of your long-term cashflow are so important.
If you’re keen to find a better balance between spending and saving in 2026 and beyond, we’re here to help.
