Sometimes You Gotta Spend Money To Make Money

One of my favorite sayings is “You gotta spend money to make money.” I don’t know why I like it so much considering it’s not always the case, but I guess the times when it is I just really REALLY love it :) Like, say, contributing to your company’s 401(k) plan. You “spend” a percentage of your paycheck every two weeks to better your future, and then your company turns around and dumps in FREE money to match! How awesome (and easy) is that? Spending money to make money at its finest.

Unfortunately, however, life isn’t always so clear cut so we do the best we can and hope we’re taking advantage of the opportunities as they’re passing us by. And things like emotions or personal barriers only muddle stuff even more (for the good, or the bad). Last night was a perfect example of this.

Here’s how a discussion between my beautiful wife and I went down last night. With her permission to share it, of course – I don’t want to share the couch!

“Hey honey, don’t be mad at me: I spent an extra $100 at Target tonight” – my wife spouted, with her cringe face on.

“Well, what did you end up buying? I’ll tell you if I’m mad after hearing that!” – I jokingly respond back ;) Knowing full well she didn’t waste any money because she’s (fortunately) not that type of a person.

“I bought like 1,000 diapers because they were having a sale where if you bought two boxes you got a $10 gift card back. And then I loaded up on laundry detergent too to get an extra $5.00 gift card as well!”

“Oh man, well in THAT case I’m definitely mad at you… Why didn’t you spend $200!” I sarcastically shoot back ;)

I won’t bore you with the rest of our conversation, but it’s a perfect example of how different our brains can be wired. My wife has trouble spending money based on the *total amount* alone, no matter what it is, whereas my inclination is to load up on these deals and max the hell out of them until they can’t be maxed any more. Especially on things you’re forever buying or investing in (*ahem* diapers. *double ahem* 401(k)). Now if we were on a strict budget it would be an entirely different story as you can’t spend what you don’t have, but since that’s not the case for us today (thanks, financial security!) I revert to eeking out as many possible deals we can get our hands on :)

My wife is a darling no matter how you slice it, but of course earning $30 or $60 dollars for free is much better than earning $15 or even $0.00 – had my wife REALLY been worried about ponying up too much. So it’s worth having a conversation with yourself (or your spouse/bf/dog/lover) so you know how to capture similar opportunities in the future if and when they may cross your path again. My wife knows now to “load up, baby!” and to do her best to not worry. Time will only tell if it works…

Another variable that comes into play is the type of opportunity that can pop up. When it comes to rebates or *guarantees* of free money, I’m fairly quick at pulling the trigger and going for it. I’ll happily do any of these with my eyes closed:

  • Maxing out 401(k) benefits (can you tell I’m passionate about that? ;))
  • Stocking up on supplies when great deals come along (that you truly need)
  • Paying down debt, no matter what type it is (you can never go wrong with that!)
  • Furthering education. Whether in courses, or degrees.

Then there are those other opportunities I get super shy around, even though deep down I know they can lead to greater and better things. These include:

  • Speaking events (great for business, not so much my stress)
  • Business investments/projects (this is a whole other can of worms, but I put it here because even though I’m getting better at sussing out the good stuff vs the bad and jumping on it, I still hold back way more than I should as my conservative side flairs up)
  • Anything else that rewards you years and years ahead. Except for retirement $$ for some reason? ;) (I suck at being patient overall, but when it comes to retirement it’s incredibly easy for me…)

I’m sure you guys can relate. Some things you’ll jump on without batting an eyelash, and others you need some time to assess before taking action (or not taking action). There’s many levels of “spending more to get more.” And if the big decisions were that easy, everyone would be Warren Buffett :)

So the point today is to figure out the things you can jump on right away at a moment’s notice (so you don’t lose the opportunity at hand), vs those you need to step back from and take more time for consideration. You probably already know the big ones (buying a house, investing in a company), so focus more on the smaller things and master those first.

One last example before we wrap up. When I first started offering blog coaching services, I got an email from someone who wanted tips on making more money through his blog. He went on and on about how much he could learn from me, and how he wants to invest time and money into it/etc, but when it came down to pulling the trigger he bailed. My rate was just too expensive for him ($100/session).

He told me he knew he should do it, but he just couldn’t justify ponying so much up (perhaps cuz the total number scared him more than the results, like with my wife?). I told him not to worry about it as I’m certainly not the cheapest person around, and before we wrapped up I gave him a few (specific) last-second pointers just to be nice. I’ve been getting paid to help people for over two years now, but it still feels kinda weird charging for something I naturally like to do anyways for free (and for fun :)).

Anyways, we go our merry ways and three months later he shoots me an email out of the blue: “Dude! One of your tricks totally worked! I make $300+ extra every month! Thank you so much!” “You’re welcome!” I happily shot back. “Now where’s my money, bitch?” I wanted to snarkily tack on, but of course I didn’t ;) And since that was over two years ago, it’s quite possible he’s now made over $7,000 extra off his blog. Not to mention any future projects he’s likely to implement the tip on.

The point? Sometimes it’s worth taking a chance on spending more so you can make more – even if it’s not guaranteed (and of course it won’t be a detriment to either your health, or your wealth). I say this just as much to you, as I do to myself too since I also struggle with it at times.

A trick I’ve tried to incorporate over the years is having a financial limit in my head for the amount I’m allowed to risk regardless of the consequences. I use it for business ideas, finding possible “steals” at yard sales, and even when I used to play poker all the time ;) This limit for me is $100, randomly enough (I swear I didn’t plan that), and it allows me to make quicker decisions and a little less over thinking.

So the takeaways today are two fold:

  1. Be prepared to jump on opportunities (by knowing your comfort levels/plan in advance)
  2. Take calculated chances with a cap you don’t mind losing.

It’s all about being as prepared as you can for opportunities. Both in money, and in life. And of course if you take nothing else away from this article, make sure you’re at least CONTRIBUTING TO YOUR 401(K) PLAN! ;)

// End novel

[Awesome photo courtesy of Camille from Challenge Mantra]

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  1. A terrible husband... April 16, 2014 at 6:08 AM

    I’m like you, taking “deals” to an extreme, although I know a buddy who bought a pallet – yep, a PALLET – of shaving cream once because the deal was “that good.” After a decade he ended up throwing a few expired cases away. Apparently this was before Amazon/eBay.

    1. J. Money April 16, 2014 at 8:18 AM

      Woahhhh haha… Now I’m not THAT hardcore ;)

  2. Stefanie @ The Broke and Beautiful Life April 16, 2014 at 6:40 AM

    I think it’s hard to know and assess ahead of time when spending money to make money is going to be worthwhile.

    I hired a blogging coach when I first started and it TOTALLY paid off. But there have been instances, for example when I got my personal trainer certification, that it didn’t really become anything worthwhile.

    1. J. Money April 16, 2014 at 8:20 AM

      For sure, not everything’s a solid bet. Usually you know the risks ahead of time though to help make a more informed decision :)

  3. Brian @ Debt Discipline April 16, 2014 at 7:51 AM

    I think being debt free really give you some great flexibility in this area. The ability to jump in on deals with free cash that others might not be able to take advantage of. When you are on a tight budget it’s tough to take advantage of offers, deals, etc.

    1. J. Money April 16, 2014 at 8:21 AM

      Yes, agree 100% You chance for jumping on opportunities go way high being debt-free, no doubt about it.

  4. jestjack April 16, 2014 at 7:59 AM

    I seem to recall a quote not so long attributed to J.Paul Getty when an employee was trying to get Mr. Getty….a “conservative gentleman” when it came to his money, to spend some money on an idea. And as the legend goes the employee used the very words…”you have to spend money…to make money”…at which time Mr. Getty fired the guy! Gonna disagree with the spending money to make money…doesn’t always apply…so now more than ever some thought and a calculator should be employed. Case in point, got a quote not so long ago on a replacement oil furnace in a rental…$8200…ouch. But the salesman said this is more effecient…etc. But even after the most optimistic scenario this thing would take over 30 years to pay for itself and the furnace only has a 20 year life…. no thanks…No matter what the salesman’s $2k laptop said…my $1 calculator begged to differ……These “hoarder shows” on cable are a good example , IMHO, of folks getting a bit carried away with the “takes money to make money” theme…..

    1. J. Money April 16, 2014 at 8:22 AM

      Yep, it’s super easy to get carried away for sure. You gotta take advantage of this concept sparingly or else you’ll be out of money in no time!

  5. Dave @ The New York Budget April 16, 2014 at 8:14 AM

    I’m definitely working on those areas that I am typically shy about pulling the trigger on. The main one being real estate investing!

    1. J. Money April 16, 2014 at 8:25 AM

      Yes, well, that one requires a LOT more energy and thinking/researching before going down that route :) You just take your time and let things soak in brotha, no shame in a slow trigger figure there!

  6. Mel @ brokeGIRLrich April 16, 2014 at 8:16 AM

    I use this trick on coffee (not nearly as sexy as 401(k)s and diapers ;o), but since I know I like Starbucks and that I will probably go at least 4-6 times a month (it sure doesn’t help there’s literally one on each side of my job), I buy the $100 gift cards from Raise when they’re have the a 5% sale. So you save like the 13% Raise starts with and then 5% more on top.

    It’s pretty much 4 free coffees. But I still have to plan ahead and buy them in $78 chunks. Then they last like 4 or 5 months.

    Dang – I should start applying this to stuff that actually MATTERS.

    1. J. Money April 16, 2014 at 8:26 AM

      HAH! It really is brilliant though – you KNOW you’re going to spend the money on it anyways so yes, take advantage and get your sexy coffee for cheaper! :)

    2. zut April 16, 2014 at 11:18 AM

      I just used this morning for 13% off of two electronic Express gift cards. Express is having free shipping and 40% off right now. Also I wait for the 40% sales these happen once a month or so…the free shipping was a nice added bonus.

      I never heard of Raise before…thanks!!!

      Cardpool and Raise are serious no brainers. Its free money and free miles or points if you use your credit card to buy the discounted gift cards. If you are going to shop at Home Depot, Lowe’s, Starbucks, VS, Express, why not take use the discounted gift cards.

      1. J. Money April 16, 2014 at 12:29 PM

        Yup! As long as you indeed NEED whatever items you’re looking to buy :) If not, you can get caught up in deals and end up spending more that normal.

        1. zut April 16, 2014 at 12:55 PM

          Work clothes. ;( Don’t worry I held out for a few months and this will probably be my only purchase of work clothes for the year. And I’m still wearing my 3 year old work shoes with holes in the soles. I know ladies…shoes do make the man. Well my shoes say “frugal” but my shirts say “sexy”!!!

          1. J. Money April 16, 2014 at 9:17 PM


  7. Tonya@Budget and the Beach April 16, 2014 at 8:54 AM

    This is something that I’ve grappled with for a long time. I know sometimes I need to do this regarding my business and blogging, but I’m on such a tight budget I sometimes can’t find a way to justify it. It’s like I want a guarantee for ROI, but there aren’t always guarantees. What do you suggest for someone with little to no wiggle room in their budget for things like this? For instance hiring someone to submit my blog to blog carnivals because I’m busy.

    1. J. Money April 16, 2014 at 12:35 PM

      Well, if you can’t cut back in certain areas to make room for something you want, or divert some $$ from a side hustle to it, I usually look for ways to trade people instead :) Maybe there’s something you can offer these blog carnival people that’s worth more to them than the $50/mo or whatever they charge? Not sure that would help your *time* problem out (since in a way you’d just be swapping services, unless you give them links or free promos on your site or something simple), but it’s an option.

      As for non-specific services with blogging, you can look for a mentor to help guide you that’s free, or even join Jana’s Bloggers Helping Bloggers program if you’re not already signed up?

      Just a matter of how high on the priority list these things you want are :)

  8. John @ Sprout Wealth April 16, 2014 at 9:17 AM

    I always struggle with this myself. There are some things that I have no problem jumping at an opportunity – it’s usually investing related or tied to our business. But, then there are other times where I just get mired in the weeds of analysis and really struggle with pulling the trigger. Thankfully my wife knows me well enough to snap me out of this, but man that paralysis by analysis can really hold you back when you should just either take the plunge or move on. Oddly enough it seems to be the smaller things I’m not willing to pull the trigger on.

    1. J. Money April 16, 2014 at 12:35 PM

      Probably better than the other way around :)

  9. Becky @ RunFunDone April 16, 2014 at 9:44 AM

    My husband’s favorite quote is, “You gotta spend money to make money!” I’m pretty sure that he just uses it as an excuse to buy tools that he doesn’t necessarily need. Sigh.

    1. J. Money April 16, 2014 at 12:37 PM

      Hah! Could be ;)

  10. @freepursue April 16, 2014 at 10:12 AM

    “And things like emotions or personal barriers only muddle stuff even more (for the good, or the bad).” That’s at the heart of the matter, isn’t it? By thinking about potential future situations in advance and planning for them, you are successfully taming your lizard brain. No wonder you’re ahead of the game. ;)

    1. J. Money April 16, 2014 at 12:40 PM

      True indeed… gotta think of all the possibilities before pulling the trigger, but at the same time can’t take too long where you just miss the boat or never make any decision whatsoever!

  11. Shannon @ Financially Blonde April 16, 2014 at 10:46 AM

    I know people who hate to spend money to the point where I think they make “stupid” mistakes as you allude to. I have always been a fan of the “cost benefit analysis” approach to spending money. I think of some expenses as investments and if the investment is expected to return more than the original investment, then it makes sense. I did this when I started my company. I have had to make a number of “investments;” however, many of them have already paid off, and I am glad that I spent the money.

    1. J. Money April 16, 2014 at 12:41 PM

      It’s almost always good to invest in yourself too :) Even if you get paid back in experience vs money!

  12. Andrew@LivingRichCheaply April 16, 2014 at 11:01 AM

    I got in on that Diaper deal at Target too! I’m a frugal guy, but I think there’s a difference between frugal and cheap. Sometimes it does take money to make money and can’t be pennywise and pound foolish. I think I fall into this mindset often with stocks…I look at the stock’s price thinking it’s expensive rather than things that are more important like the P/E ratio, etc.

    1. J. Money April 16, 2014 at 12:42 PM

      Oh man, I don’t even look at individual stocks anymore really… that’s a whole other ballgame that requires lots of time and research of which I have neither these days :) I admire those like you who sit down and look ’em all over though, that’s for sure.

  13. Even Steven April 16, 2014 at 11:57 AM

    One of the biggest hurdles for me and spending money is am I responsible for making the investment, make money. You mentioned poker, I have no troubles sitting down to play some poker and put down $100 or $200 or at least I used to before the wife, dog, and mortgage. Since I knew that ultimately I was responsible for making or losing that money I was ok with that. However, when an outside party is being paid to help me make money, it definetly becomes more difficult. You start asking questions, will I get my investment back, does this person know what they are doing, should I just figure it out on my own.

    It can be interesting psychology though. Most people have no problem spending thousands of dollars on college and education, mostly because it is needed in the work world and they expect a return. However when starting a business most people will not pay for the education of a coach or mentor, despite the added value. This is usually seen as something or someone who should do this for free, at least the psychology of it.

    The financial limit is a great idea to put into practice, thanks for the Free Tip:)

    1. J. Money April 16, 2014 at 12:47 PM

      Luckily there’s a TON of free information on the interwebs for everyone to access :) Just not directly related, one-on-one, advice for specific questions/tips as much unfortunately.

  14. Crystal April 16, 2014 at 12:53 PM

    I thought of two things while reading this:

    1) wants me to join their network but I hesitated since it is $20 per lead. Not per job, per lead. So I would have to close nearly every lead to make it worth it to me. But I could possibly do that…

    2) I need to pay you $100 for a session to learn how to make more money off of BFS…

    Have a great hump day!

    1. J. Money April 16, 2014 at 9:20 PM

      Maybe set aside $100 to test it out and then kill it or go forward from there? Best case you make money (and repeat business!) and worst case you write it off come tax time and don’t lose *as* much money, even though you’re still out $. That’s what I’d do anyways, but I don’t know squat about the pet biz :)

  15. Richard Anthony April 16, 2014 at 2:32 PM

    “You can’t spend what you don’t have? ” Man, I wish you had been around to educate my ex-wife on that one! How about spending money before you have it? (She was great at that too.) But I digress. Like Tonya, I want a ballpark ROI before I spend speculative bucks on anything. I’d have no problem paying anyone $100 for advice if I knew that advice was likely to add an extra $300 a month to my income. In your case, permit me to offer some free advice that’s guaranteed to make you more money. (We’ll discuss my cut later, haha.) The advice involves basic salesmanship.

    #1: Go back to this very person who thanked you and ASK FOR THE ORDER. Say, “Now that you’ve reaped an extra $300/mo. (by now mebbe $7000?) from my free tip, how about we schedule a $100 coaching session where I can give you other tips that may up your income another $300 a month?” Keep this saying in mind (from my upcoming book of cliches): “If you don’t ask, you don’t get. . . .”

    #2: Look for other sites that you believe would profit from the same tip you gave to this individual and suggest that they retain you for a $100. session, with a money-back guarantee if they don’t reap a measurable ROI within a specified time frame. If you’re confident in your product, this should involve minimal risk to both them and you.

    As regards Shannon’s desire for “cost benefit analysis,” it’s easy to fall victim to paralysis by analysis. In the immortal words of The Home Depot, “Let’s Do This!”

    1. J. Money April 16, 2014 at 9:22 PM

      Haha… I like the way you think ;) If only all sites worked the same!

  16. Zach K April 16, 2014 at 4:40 PM

    I have taken advantage of the target deal too. Buy 2 boxes, get a 20 dollar gift card, use two coupons from and 5-10% off cartwheel offer and all of a sudden you are getting diapers for 9cents a piece instead of buying a box that is normally 20 to 25 cents a diaper.

    I currently have about 6 boxes sitting in my “Baby Pantry” at home.

    1. J. Money April 16, 2014 at 9:22 PM

      YES! Love that!!

  17. FF April 16, 2014 at 6:29 PM

    Good info, and nothing wrong with taking base hits – the home runs are hard to come by (and sometimes if you get excited thinking you’ve got one, you run into trouble).

    I’d like to think that if you usually operate with the “spend to save” mindset things are going to work out OK. Sure, it’d be better to save $30 or $60 than $15, or to get the amazing website deal, but getting “pretty good” deals often enough goes a long way.

    1. J. Money April 16, 2014 at 9:23 PM

      True that. And nice seeing you here again bud :) Hope you’re well!

  18. Camille @ Challenge Mantra April 16, 2014 at 8:13 PM

    It’s my kitty!

    I have the same perspective on playing the credit card bonus game. For a recent checking account I signed up for with a 60,000 airline mile bonus if you spend $700 on thei debit card, I figured out that I can buy $700 in gift cards to my favorite grocery store and not technically “spend” any money. Or, I can look at it as paying for all my groceries up front at somewhere I know I’ll be going anyway. “Spend money to save money”, and now I can get free flights home to the family :)

    1. J. Money April 16, 2014 at 9:23 PM

      Woohoo! Way to work the system!

  19. FI Fighter April 17, 2014 at 2:35 AM

    haha, I think I got the hint! I just re-enrolled into my company’s 401k plan last week after stopping it for a year… tax man hit me hard this year… ;)

    1. J. Money April 18, 2014 at 9:22 PM

      Love hearing that! Well, the 401k part – not the tax man ;) Although that usually means you’re doing pretty damn well in the income department Mr! So I tip my hat to you.

  20. Kalen @ MoneyMiniBlog April 17, 2014 at 2:28 PM

    So first off, your wife sounds like my wife.

    We actually have, what I call, our “zombie apocalypse survival shelf”. Basically a stockpile of stuff that she paid little or nothing for…have you seen Extreme Couponers? Yeah, that’s her…and I’m thankful for that!

    As far as spending money to make money, like you mentioned, that applies heavily to my blog. I wouldn’t buy things for a few bucks, because I didn’t want to spend the money. Now, after I research something for my blog, I am always glad I bought the things that I have bought. Sometimes it’s worth it to pay for premium versions and spend a few bucks on tools!

    1. J. Money April 18, 2014 at 9:27 PM

      I soooooo want one of those zombie apocalypse survival shelves! You guys are definitely way ahead of us in that department. We usually only have 1 week’s worth of food in the house, if that. Though now we’re pretty good on diapers :) (not that that’s food, but you get the point)

  21. Christine @ ThePursuitofGreen April 18, 2014 at 6:20 PM

    Your wife did well at Target! that was an awesome deal to take advantage of. It’s always good to be on the lookout for ways to save money in bulk and to make money off things that are on sale!

    This isn’t to my credit…technically my husband’s…but he wouldn’t have been able to score this if I hadn’t dragged him there. Thrift store where he spied an Oakley watch originally retailed for $1300…selling for $70! Snatched it up, put it on Ebay, and made $200 after taxes and fees. Potentially could’ve gotten more but for something unexpected pretty darn good!

    1. J. Money April 18, 2014 at 9:28 PM

      Oh wow, your husband’s a pimp! And even more so for not keeping it for himself – that can be hard to do :) Happy Easter my friend!