Mid-Life? Yes. Crisis? Not So Fast.
Spending money to make yourself feel young again is okay-if you can be an adult about it
By Jean Chatzky

(MONEY Magazine) – The warning signs are easy to spot: As soon as you turn 45, you find yourself Googling "hang gliding" and "Nepal hotels" late at night. You periodically dial the number of the local Botox clinic and hang up at the last second. And you can't get your eyes off that ad for the redesigned Ford Mustang.

If you were to actually follow through with these urges, of course, you would be having what's known as a mid-life crisis. You would also have blown a lot of money. Part of the reason it's called a crisis is that it causes even the most frugal and savvy investors to plow their nest eggs into irrational purchases (not to mention the havoc it can wreak on a marriage or career). And while many people consider these episodes the sole province of men, women are affected just as much. Twenty-six percent of American women and men report having a mid-life crisis, according to Cornell University sociology professor Elaine Wethington, a researcher with the ongoing Midlife in the United States project. Today men flock to plastic surgeons (weird but true stats: Upper-arm lifts for men have increased 368% since 2003, and cheek implants are up 135% since 2000) and women buy snazzy sports cars. According to data from R. L. Polk, the number of women over 45 purchasing speed machines like the Corvette and the Mazda RX-8 is up 248% in the past five years.

But while these anxiety-induced panics may be inevitable for some, the disaster needn't extend to your bank account. "Mid-life can make you feel needy in a number of ways," says Sue Shellenbarger, author of The Breaking Point: How Female Midlife Crisis Is Transforming Today's Women. And "needy" can mean needing a new pair of $500 shoes or a trip to Bora-Bora. A 2004 Carnegie Mellon study titled "Heart Strings and Purse Strings" found that sadness makes people willing not only to pay but to overpay for goods and services they believe will make them feel better.

Even when soothing the pain isn't the goal, a mid-life crisis can obliterate your inhibitions about everything from extramarital relationships to bungee jumping to spending money. You simply may not have the will you once counted on to pass Tiffany's or the Hummer dealership without impulsively plunking down your credit card. I'm not going to spend the next few paragraphs telling you not to try to buy your way out of your panic--you might very well need a treat. But there are ways to get through your crisis without screwing up your financial future.

• Set a budget. This may seem strange. After all, no one plans a mid-life crisis, and calculating a budget for impulsive purchases is a tad oxymoronic. But you should give yourself the freedom to indulge while you're going through a crisis, says financial adviser Kathleen Longo of Accredited Investors in Edina, Minn. "Look at where you're currently spending and reprioritize," Longo says. "You might decide clothing isn't going to do it for you right now, but a big trip will give you time to reflect." If you've been spending $600 a month eating out, drop down to $200 and put the rest toward an African safari. Although Longo won't advocate financing a crisis with debt or a 401(k) withdrawal, she does say it's okay to take a break from saving for a while: "Maybe you'll have to extend your retirement date by a year. That's okay if it helps you get through this period in your life."

• Get the same thrill for less money. Think about how to bring your dream indulgence into the realm of reality. You want to get in shape? There are ways to do it without an expensive personal trainer. Craving jewelry? It doesn't have to be a diamond. And there are plenty of lovely beaches in the world besides the one at the Four Seasons in Nevis.

• Focus on experiences rather than things. According to Daniel Gilbert, a professor of psychology and a happiness expert (seriously) at Harvard, buying something like a car to make you happy is a short-term fix. "Think of buying that car as buying a good meal," he says. "It's going to be terrific, but you're going to be hungry again in the morning." Experiential spending (a trip to the Galápagos to frolic with sea lions, for example) tends to make people happier over time, in part because you can tell--and embellish--the story over and over.

• Come up with crafty ways not to buy. It's possible to exhaust your shopping jones and keep your bank (and credit card) balance in check. When you surf the Web, put everything you want in your basket and then shut down the computer. If you're a man, taking a motorcycle for a 24-hour test drive might satisfy your curiosity. Spending an afternoon in a high-end electronics store checking out plasma TVs could be the best way to realize that you can live another year without one. Personally (and having recently turned 40, I feel qualified to share my strategy), I shop--rather than buy--until I can't stand it anymore. I try on everything I find even vaguely attractive. When I feel my resolve about to crumble, I head to the checkout counter and put the object of my heart's desire on hold. I tell myself if I still want it tomorrow, I'll come back. Not surprisingly, I rarely do.