We let them spend on many things and only advice that some things might be disappointing. The restrictions we keep are the instant gratification items. Like food, but also heavily advertised overpriced items like LOL surprise, or video game items. I feel kids should not get used to spending money on that kind of thing as it can be addictive.
This is really where I struggle. I guess I want to protect them. I know they need to learn how it feels to regret wasting money on something that won't be very satisfying, but I also want to protect them from disappointment! I do have a no junk food rule. (Their dad buys them enough 'treats'.)
So, really, the "teachable moment" was for you, eh? ;-)
I joke, but the hardest thing about parenting for me was letting my kids make their own mistakes, particularly when it was SO OBVIOUS to me exactly what was going to happen. The problem is that for most kids, that's how they learn. I mean, I'm sure that out there somewhere is the perfect kid who always managed to internalize all parental lessons without once having to touch the stove themselves just to see if it really was hot. But I certainly never had one of those kids. IME, the more determined the kids are to ignore parental advice, the more they need to be allowed to do it themselves and deal with the consequences. No matter how painful it is (to you!!) to watch them go through it.
When my firstborn (the one who taught me the above lesson about pigheadedness) was a toddler, my DH would let her play on the playground by herself, as long as she was within a couple of feet from the ground (no matter how nervous I was about letter her do it herself!). But the second she started climbing up to 5-6' in the air, he'd be right there to catch her if she fell. And that became our lifelong parenting analogy: we let her take the 2-foot fall, but not the 5-foot one, so she had the freedom to play and to learn that gravity isn't just a good idea, but all without facing a fall that could truly damage her.
To a 10-yr-old, a $50 drone feels like falling from the Empire State Building -- but from the parenting perspective, it's really about 6" off the ground. And you both navigated that fall very, very well.
The thing is, we can't actually protect our kids from all unhappiness and disappointment, and
we do them a disservice if we try. The reality is that the world is going to toss them disappointments right and left, and part of growing up is learning the skills to manage that. And that means that our job as parents is to periodically let them make their own mistakes -- even though we could have prevented it, even though we have to watch them be sad and dry their tears*, even though they have to do things they're nervous about like knocking on a neighbor's door or writing a letter -- because it is the very fact of going through that that teaches them how to deal with those types of scenarios. Which, circling back to the above, means that they actually
need to take the occasional 2' fall, so that when the 3' fall comes along the following year, they're able to handle it, and have started to build confidence in their ability to do so.
*Without ever actually saying "I told you so," which IME is the hardest parental task of all. ;-)