New Delhi, Oct. 22 -- Spending well means using money to improve your life, says author Morgan Housel. His book, "The Art of Spending Money", explores how envy, identity and insecurity influence purchases. Its five lessons favour personal satisfaction, useful purchases and freedom over winning approval.

Housel, who wrote "The Psychology of Money", offers no fixed spending formula. Instead, he encourages readers to understand what makes them happy.

Morgan Housel recalls meeting a hotel guest who spent $21,000 on an armchair. The guest believed wealthy people were supposed to make such purchases. Housel wondered whether he liked it.

Seeking approval can increase desires and reduce satisfaction with existing possessions. Before buying som...