Some days call for treating yourself, whether it's going out for a nice dinner or springing for a new watch.
And as long as you're not sacrificing other financial goals, such as building an emergency fund or saving for retirement, and you keep the purchase price under 5 percent of your overall net worth, the occasional splurge is deserved, Garrett Oakley, certified financial planner at Betterment, tells CNBC Make It.
But what you choose to spend money on isn't always worth it.
If you're contemplating investing in a luxury item such as a classic car or brand-name handbag, don't do it for the appreciation value, says Oakley. You should make big purchases because they make you happy, not because you think they'll make you rich.