This topic seems to come up in many conversations with clients and in my Simply Money seminar.  Many of us are feeling conflicted that we should not spend because we might lose our jobs, we need to preserve our savings or just overall guilt that this is not the time to be spending.

It seems like quite a paradox because retail, travel, car and real estate prices have come down tremendously.  Maybe now is the time to buy your nephew those new art supplies he really needs for his budding talents. Or maybe it's time to take you niece on that trip to Paris you promised her since she was a little girl.

Tempting, isn't it?

We are also afraid that by not spending, we are contributing to the downfall of our economy.  A major reason to spend is that not spending directly affects our economy.  By not giving money back to our economy, we are putting off the economic boost we sorely need.

I support the idea of prudent spending.  This means giving yourself permission to spend a certain amount you know you can afford.  Have fun with it and make it worthwhile.  You should not be putting more charges on your credit card if you carry a balance.  However, using cash can provide the same benefits.

Most of us are middle-class.  The pressure for us to spend tremendously so to boost our economy is not realistic.  As long as we are taking an action we feel confident about, we are on the right path.

We definitely need to up our percentage of saving but not to the point that we are not living our lives.  As long as we are saving more than we did a year ago, we are making huge strides.

A spending suggestion in The New York Times, by David Leonhardt, offered that we should invest is making our homes more energy efficient.  We are putting money back to the economy but actually creating potential long-term savings.