If you’ve ever debated whether to spend that bonus on a beach vacation or add it to your investment account, you’re not alone. The choice between investing in experiences versus assets is a classic dilemma. As financial advisors, we’ll be the first to tell you that saving and investing for the future is critical—compound interest doesn’t just grow your money; it practically gives it a personal trainer. But sometimes, life isn’t just about spreadsheets and ROI; it’s about the return on joy.

So, can experiences hold their own in the battle against assets? Let’s dig in.

The Science of Happiness: Memories vs. Stuff

Multiple studies show that people derive greater long-term happiness from experiences than material possessions. It’s not that buying a new car or the latest gadget isn’t fun—it’s just that the shine tends to fade. This phenomenon, known as hedonic adaptation, is why the thrill of a new toy wears off faster than your kids can lose an instruction manual.

Experiences, on the other hand, stick with us. Why?

  1. Anticipation Amplifies Joy: Planning a trip or a concert is half the fun. Even the act of looking forward to an experience boosts happiness—something you don’t typically get by scrolling your brokerage statement.
  2. Stories > Stuff: Experiences become part of your identity and your stories. No one sits around a campfire talking about their bank account balance, but they will tell the tale of how they nearly missed a train in Italy or tried skydiving that one time.
  3. Less Comparison: It’s easy to compare a car to your neighbor’s or notice a fancier version of what you own. With experiences, the focus shifts to your memories, making them uniquely valuable.

But Wait—Are Experiences Always a Good “Investment”?

We get it. You don’t want to YOLO your retirement savings into a series of globe-trotting adventures. As your financial guide, we’re here to balance the scales. Not all experiences are created equal:

  • The Experience Dividend: Think of experiences as having a “dividend yield” in life satisfaction. Spending on things that align with your values—like learning a new skill, bonding with family, or fulfilling a bucket-list dream—tends to pay off for years in happiness.
  • Avoiding Experience Inflation: Just as lifestyle inflation can sabotage savings, constantly chasing bigger, fancier trips or outings can eat away at your financial goals. Remember, joy comes from meaning, not price tags.

A Balanced Portfolio—With a Sprinkle of Adventure

Here’s where it gets fun: you don’t have to choose between experiences and financial security. A solid plan allows you to enjoy both.

  1. The 80/20 Rule of Spending: Prioritize saving for long-term goals (retirement, home, kids’ college) with a majority, say 80%, of your surplus income. The other 20%? Invest in the present. Plan experiences that excite you and create memories you’ll treasure.
  2. Save for “Fun” Intentionally: Open a “Joy Fund”—an account designated for experiences. Treat it like any other goal. Seeing it grow can be nearly as rewarding as the trip itself.
  3. Memories vs. Stuff Test: Before a big purchase, ask yourself, “Will I remember this in 10 years?” If the answer is no, maybe opt for a unique experience instead.

In Conclusion: Balance Wins the Day

Investing in your future is non-negotiable—you don’t want to be the 80-year-old wondering if you can trade stories for rent. But at the same time, life is happening right now. A sound financial plan doesn’t just secure your future; it gives you permission to enjoy the present without guilt.

So, go ahead—book that cooking class in Tuscany or take the kids to Yellowstone. Your 401(k) will understand, as long as you don’t ghost it entirely. After all, the best ROI sometimes comes in the form of a great story, not a line item on a statement.