We don’t know when to stop. Ever eat too much (like a full tub) of ice cream.
I have. The whole lot. And yes I know that’s bad.
Bite 1: Best thing in the world, ever.
Bites 2-10: Really good.
Bites 11-15: Good.
Bites 16-20: Meh.
Bites 21+: OK, now I'm sick.
I learned this lesson the first time I ate a tub of ice cream in one go.
And yet, for some reason, I still occasionally repeat the experiment.
Of course, this phenomenon doesn’t only occur with ice cream. This is a well-documented economic principle called Marginal Utility, and, you guessed it, it applies to money, too.
Beyond a certain point, having more money will not lead to more security, freedom, and happiness. An this works on repeated spending too
Because security, freedom, and happiness do not come from more money (at least, not beyond a certain point). They come from knowing when to stop.
If a splurge happens so often it becomes normal, then it stops being fun. Instead delay spending to increase gratification and enjoyment.
Infrequent splurges bring the greatest happiness