Björn Berg answers questions by the readers of online news outlet Vísir.

A 30-year-old man asks:

Life should be enjoyable.

I strongly disagree with the mother of a friend of mine, who I once heard telling him: “Life isn’t supposed to be fun.”

You only get this one round, so you might as well try to make the most of it.

With good planning and regular debt repayment, you’re probably increasing your future options and giving yourself more freedom to enjoy life later. Still, the balance you mention matters, and I’m glad you’re asking the question.

Why you’re already on the right track

Before we get to the question of balance, I think you should give yourself a bit of credit for how you’re handling your finances today.

You keep a household budget. You’ve bought a home. You’re making extra payments on your mortgage. Not everyone does that, and I know it takes discipline, time and ambition.

The fact that your mind goes straight to paying down the mortgage when you have money left over also shows that you understand the benefit of reducing debt faster. I’ve written before about some of those benefits, including what you gain by making extra payments, why the loan balance may not seem to fall as quickly as expected, and whether it’s better to save or pay down debt.

There’s nothing wrong with that focus.

So where is the balance?

But where should the balance actually be?

How much should you spend on fun, save for later and use to pay down debt?

There are many schools of thought on this. My view is that it can be risky to copy other people too closely.

Rules of thumb, such as the 50/30/20 rule, may help some people get started. But they can also be a little too simple. People’s circumstances differ. So do their priorities, plans and opportunities.

Since you’re already this well organised, I’d suggest making your own plan and trying the following approach.

What room do you have?

Look at your household budget as it stands today.

Assuming you’re already saving what you need to save, add together your current mortgage payment and the amount you usually have left over at the end of the month.

Then enter that total amount as a fixed monthly payment into a mortgage calculator. This should give you a clear picture of what would happen if all of that money went towards the loan. For example, you can see when the mortgage would be fully paid off.

Next, think about what you could allow yourself to spend, or how you might build up investments later on.

A savings calculator can help with that. This kind of exercise can show you that you may be preparing for significant investments or major expenses, just not immediately.

Is it worth it?

Now reduce the total monthly amount by ISK 50,000. Then try reducing it by ISK 100,000.

Look at what difference that makes to the mortgage.

Of course, the result will be less favourable when you slow down repayment. But the real question is whether the trade-off might still be worth it.

That’s what you need to answer.

Write down 10 ideas for spending, including both monthly spending and larger one-off costs. What would be the most fun? What would genuinely make you happy, improve your quality of life and send you both smiling to bed and refreshed into the next day?

Put a price on these possible expenses and rank them.

Then see how they fit into a monthly fun-money allowance of ISK 50,000 or ISK 100,000. Finally, compare the value of what you get from that spending with the benefit of paying down the mortgage faster.

That should make the decision easier.

Don’t listen too much to other people

It doesn’t really matter what other people think.

Because you seem organised and ambitious, I’m not worried about you, whether you choose to allow yourself a little more room to spend or keep following your current budget.

Far too many people spend money to impress others, copy people on social media or take part in something that is apparently supposed to be fun.

If something genuinely makes you happy, fits within a healthy household budget and doesn’t harm your future plans, I don’t see anything wrong with going for it.