Permission to Spend: Using Permission Buckets to Overcome a Scarcity Mindset

One of the most surprising patterns I see as a financial advisor is that some of the people with the strongest financial plans are also the most uncomfortable spending money. 

A Familiar Story 

I see this pattern often, but one example stands out. 

For example, consider a hypothetical couple who most people would consider an ideal financial situation. They saved diligently for decades, invested conservatively, and built a plan with a high likelihood of long-term success, even under stressful market and longevity assumptions. On paper, they are more than fine. 

Yet when they talked about spending, traveling more, making life easier, or simply enjoying the flexibility they earned, the conversation stalled. Every idea led to the same concern: What if something happens later? 

It’s not necessarily the numbers. It was the fact that they didn’t need more analysis. They needed permission to spend. 

Once they separated financial safety from discretionary enjoyment and intentionally carved out money meant to be used, something changed. Spending no longer felt like a threat. It felt like following the plan. 

These are not people living on the edge. They often have substantial savings, diversified investments, and conservative assumptions built into their plans. Objectively, they are financially secure. Yet when it comes time to spend money on travel, experiences, convenience, or anything that could clearly improve their quality of life, they may hesitate. 

They don’t fear the present. They fear the possibility of the future. This is where Permission to Spend becomes critical. 

Why Having Enough Money Still Doesn’t Feel Like Enough 

From the outside, this reluctance to spend might not seem logical, but money decisions rarely rely on logic alone. 

A scarcity mindset often grows from: 

• Loss aversion, where spending feels like giving something up even when it improves life 

• Early money experiences that reward discipline and caution 

• Uncertainty about the future, since even strong plans can’t eliminate every unknown 

• Moral framing, where saving feels responsible and spending feels risky 

As a result, people may unintentionally trade meaningful experiences today for extra financial safety they don’t actually need. 

Having money is not the same as having permission to spend it. 

Research consistently shows that how money is spent matters more for happiness than how much is accumulated. In The Surprising Truth About Spending: How to Use Your Wealth to Boost Happiness, I wrote about how intentional spending supports well-being and satisfaction. 

What “Permission to Spend” Actually Means 

Permission to spend does not mean being reckless or abandoning discipline. It means creating a deliberate, preapproved framework for using money in a way that aligns with long-term security and present-day fulfillment. 

Instead of asking “Can I afford this?” over and over again, permission to spend answers that question in advance. That permission comes from design, not impulse. 

This psychological and planning shift often appears when people move from accumulation mindsets to spending with confidence. 

What Are Permission Buckets? 

Permission Buckets are a behavioral finance tool that separates financial safety decisions from life enjoyment decisions. 

Instead of treating every spending choice as a potential threat to the future, Permission Buckets assign specific dollars the job of being spent. 

This money has permission to be used without guilt and second-guessing. Once you create and fund the bucket, spending within it does not require additional justification. You’ve already made the decision. 

The Behavioral Science Behind Permission Buckets 

Permission Buckets work because they align with how people think about money. They naturally sort money into categories, and this mental accounting can reduce anxiety and second-guessing. When you define a purpose for certain dollars, you simplify decisions and lower stress at the moment of spending. 

They also balance care for your future self with your needs and desires today, protecting long-term security without neglecting the present. By pre-approving spending that reflects your values, Permission Buckets can help minimize regret and support a well-lived life. 

Rather than weaken discipline, Permission Buckets give it a healthier outlet. 

How to Create and Use Permission Buckets 

Step 1: Lock in Financial Safety First 

Permission only works when safety is clearly defined. Start with a conservative financial plan that accounts for core living expenses, appropriate emergency reserves, long-term goals, and health care and longevity considerations. The psychological anchor is knowing that your plan is designed to stay on track even if you spend every dollar in your Permission Buckets. 

Step 2: Choose Buckets That Reflect Values (3 to 5 Max) 

Buckets should feel personal and meaningful. Ask yourself: When I look back on this stage of life, what will I wish I had given myself permission to enjoy? 

Examples include: 

• Experiences and travel 

• Health and longevity 

• Family and memory-making 

• Life simplification (buying back time and reducing stress) 

• Growth, learning, and curiosity 

If a bucket doesn’t resonate emotionally, it will not get used. 

Step 3: Decide How Much to Put in Each Bucket 

Fund Permission Buckets with intention, not leftovers. Options include setting a fixed annual dollar amount, allocating a percentage of projected surplus cash flow, or designating a one-time amount for enjoyment. Permission comes from intention, not whatever remains. 

Step 4: Set Clear Rules for Spending 

• Money in the bucket is meant to be spent 

• Spending within the bucket doesn’t require re-approval 

• Bucket money doesn’t return to investments 

• Unused buckets trigger a review, not praise 

Spending within these boundaries is not irresponsible. It is the goal. 

Common Obstacles and How to Overcome Them 

“I still feel anxious when I spend the money.” 

That’s normal. Anxiety usually peaks before spending and fades afterward. Repeated positive experiences build confidence. 

“What if something unexpected happens?” 

Your plan already accounts for that risk. Permission Buckets exist because safety came first. 

“I don’t want to lose my discipline.” 

Discipline built the plan. Permission Buckets help you use that discipline to create a well-lived life. 

“We don’t seem to use the money.” 

Unused buckets signal that you may need to revisit priorities, timing, or bucket design. They are not a sign that spending is wrong. 

The Bigger Picture 

Money is not only a tool for future security. It is also a tool for living well today. 

For people with a scarcity mindset, the challenge isn’t accumulating more. It’s learning how to trust the plan enough to give themselves permission to spend. 

Permission Buckets offer a structured, emotionally grounded way to do that, so money supports life instead of quietly limiting it. 

The goal is not only financial success. It is using that success well.