Age: 26
Annual Salary: $65,000
Monthly Take-Home Pay: $3,771
Monthly Beauty Budget: $417

Beauty Budget Breakdown: Kathryn spends $190 a month on her nails, $1,400 a year on maintaining her blonde hair, and the rest on higher-end makeup, the occasional facial, and waxing and laser hair removal.

Why: Kathryn says that her spend-y beauty habit is justified because of the image-conscious nature of her industry. She also admits, "If I wasn't so insecure, I wouldn't be buying all this stuff to cover my face and hair."

Matthews looks at Kathryn's numbers in a different light. "You could invest that same $5,000 into something safe that might grow 8 percent a year for the next 40 years, and you can start building a nest egg," she says.

"For example, suppose she invested $5,000 in the simplest passive buy and hold portfolio of 60 percent U.S. stocks and 40 percent bonds," Matthews continues. "According to Vanguard, this has returned 8.9 percent annually over the period from 1926 to 2013. If we project this return forward over the next 40 years, she would end up with approximately $1.8 million for retirement."

Matthews concedes that investing in your appearance can lead to higher earnings. "There are studies that show the better you look, the [greater] chance you have of getting the job and earning a higher income. But there's no guarantee that spending that kind of money is going to land you the job. It's really more about striking that balance, and investing in your future is still investing in yourself."

If Kathryn did her nails at home, she'd save about $2,270 dollars per year. If she switched from all-over hair color to low-maintenance balayage highlights, she'd save about $800 a year. All that saving adds up -- she'd save over $15,000 in five years, which would accrue even more money if she invested it.

Age: 32
Annual Salary: $95,000
Monthly Take-Home Pay: $5,083
Monthly Beauty Expenses: $164

Beauty Budget Breakdown: Stephanie spends about $1,970 a year on beauty -- she gets her nails done twice a month, which accounts for $80 of her monthly budget, a $20 monthly brow wax and a $50 hair cut once every three months. She buys high-end skin care and department store makeup.

Why: Stephanie isn't really willing to alter her beauty routine; she deems it conservative. "I don't dye my hair like a lot of people, so I think bimonthly manicures are okay," she says. "I really can't do my nails myself. They'd look like a three-year-old painted them."

Stephanie is saving to buy a house, and Matthews says that beauty is a category in which you can find creative ways to save.

To help Stephanie remember her financial goal, Matthews suggests this technique: Close your eyes and imagine yourself in 30, 40 or 50 years. She says that studies have shown envisioning yourself as an older person can help to accept delaying gratification -- i.e., resisting those massage and scrub add-ons at the nail salon. "People start to think more concretely about the consequences of their present choices," Matthews explains. "And then they're more likely to make decisions that their future self doesn't regret."