diff --git a/mopidy/backends/local/__init__.py b/mopidy/backends/local/__init__.py
index c7126824..975ec458 100644
--- a/mopidy/backends/local/__init__.py
+++ b/mopidy/backends/local/__init__.py
@@ -15,13 +15,6 @@ from .translator import parse_m3u, parse_mpd_tag_cache
 
 logger = logging.getLogger(u'mopidy.backends.local')
 
-DEFAULT_PLAYLIST_PATH = os.path.join(DATA_PATH, 'playlists')
-DEFAULT_TAG_CACHE_FILE = os.path.join(DATA_PATH, 'tag_cache')
-DEFAULT_MUSIC_PATH = str(glib.get_user_special_dir(glib.USER_DIRECTORY_MUSIC))
-
-if not DEFAULT_MUSIC_PATH or DEFAULT_MUSIC_PATH == os.path.expanduser(u'~'):
-    DEFAULT_MUSIC_PATH = os.path.expanduser(u'~/music')
-
 
 class LocalBackend(ThreadingActor, base.Backend):
     """
@@ -81,7 +74,7 @@ class LocalPlaybackController(core.PlaybackController):
 class LocalStoredPlaylistsProvider(base.BaseStoredPlaylistsProvider):
     def __init__(self, *args, **kwargs):
         super(LocalStoredPlaylistsProvider, self).__init__(*args, **kwargs)
-        self._folder = settings.LOCAL_PLAYLIST_PATH or DEFAULT_PLAYLIST_PATH
+        self._folder = settings.LOCAL_PLAYLIST_PATH
         self.refresh()
 
     def lookup(self, uri):
@@ -158,12 +151,11 @@ class LocalLibraryProvider(base.BaseLibraryProvider):
         self.refresh()
 
     def refresh(self, uri=None):
-        tag_cache = settings.LOCAL_TAG_CACHE_FILE or DEFAULT_TAG_CACHE_FILE
-        music_folder = settings.LOCAL_MUSIC_PATH or DEFAULT_MUSIC_PATH
+        tracks = parse_mpd_tag_cache(settings.LOCAL_TAG_CACHE_FILE,
+            settings.LOCAL_MUSIC_PATH)
 
-        tracks = parse_mpd_tag_cache(tag_cache, music_folder)
-
-        logger.info('Loading tracks in %s from %s', music_folder, tag_cache)
+        logger.info('Loading tracks in %s from %s', settings.LOCAL_MUSIC_PATH,
+            settings.LOCAL_TAG_CACHE_FILE)
 
         for track in tracks:
             self._uri_mapping[track.uri] = track
diff --git a/mopidy/backends/spotify/session_manager.py b/mopidy/backends/spotify/session_manager.py
index aa3734ae..856257f1 100644
--- a/mopidy/backends/spotify/session_manager.py
+++ b/mopidy/backends/spotify/session_manager.py
@@ -6,7 +6,7 @@ from spotify.manager import SpotifySessionManager as PyspotifySessionManager
 
 from pykka.registry import ActorRegistry
 
-from mopidy import audio, get_version, settings, CACHE_PATH
+from mopidy import audio, get_version, settings
 from mopidy.backends.base import Backend
 from mopidy.backends.spotify import BITRATES
 from mopidy.backends.spotify.container_manager import SpotifyContainerManager
@@ -22,8 +22,7 @@ logger = logging.getLogger('mopidy.backends.spotify.session_manager')
 
 
 class SpotifySessionManager(BaseThread, PyspotifySessionManager):
-    cache_location = (settings.SPOTIFY_CACHE_PATH
-        or os.path.join(CACHE_PATH, 'spotify'))
+    cache_location = settings.SPOTIFY_CACHE_PATH
     settings_location = cache_location
     appkey_file = os.path.join(os.path.dirname(__file__), 'spotify_appkey.key')
     user_agent = 'Mopidy %s' % get_version()
diff --git a/mopidy/settings.py b/mopidy/settings.py
index 0612fc24..a2270707 100644
--- a/mopidy/settings.py
+++ b/mopidy/settings.py
@@ -85,9 +85,8 @@ LASTFM_PASSWORD = u''
 #:
 #: Default::
 #:
-#:    # Defaults to asking glib where music is stored, fallback is ~/music
-#:    LOCAL_MUSIC_PATH = None
-LOCAL_MUSIC_PATH = None
+#:    LOCAL_MUSIC_PATH = u'$XDG_MUSIC_DIR'
+LOCAL_MUSIC_PATH = u'$XDG_MUSIC_DIR'
 
 #: Path to playlist folder with m3u files for local music.
 #:
@@ -95,8 +94,8 @@ LOCAL_MUSIC_PATH = None
 #:
 #: Default::
 #:
-#:    LOCAL_PLAYLIST_PATH = None # Implies $XDG_DATA_DIR/mopidy/playlists
-LOCAL_PLAYLIST_PATH = None
+#:    LOCAL_PLAYLIST_PATH = u'$XDG_DATA_DIR/mopidy/playlists'
+LOCAL_PLAYLIST_PATH = u'$XDG_DATA_DIR/mopidy/playlists'
 
 #: Path to tag cache for local music.
 #:
@@ -104,8 +103,8 @@ LOCAL_PLAYLIST_PATH = None
 #:
 #: Default::
 #:
-#:    LOCAL_TAG_CACHE_FILE = None # Implies $XDG_DATA_DIR/mopidy/tag_cache
-LOCAL_TAG_CACHE_FILE = None
+#:    LOCAL_TAG_CACHE_FILE = u'$XDG_DATA_DIR/mopidy/tag_cache'
+LOCAL_TAG_CACHE_FILE = u'$XDG_DATA_DIR/mopidy/tag_cache'
 
 #: Sound mixer to use.
 #:
@@ -177,7 +176,11 @@ OUTPUT = u'autoaudiosink'
 #: Path to the Spotify cache.
 #:
 #: Used by :mod:`mopidy.backends.spotify`.
-SPOTIFY_CACHE_PATH = None
+#:
+#: Default::
+#:
+#:     SPOTIFY_CACHE_PATH = u'$XDG_CACHE_DIR/mopidy/spotify'
+SPOTIFY_CACHE_PATH = u'$XDG_CACHE_DIR/mopidy/spotify'
 
 #: Your Spotify Premium username.
 #:
@@ -194,7 +197,7 @@ SPOTIFY_PASSWORD = u''
 #: Available values are 96, 160, and 320.
 #:
 #: Used by :mod:`mopidy.backends.spotify`.
-#
+#:
 #: Default::
 #:
 #:     SPOTIFY_BITRATE = 160
diff --git a/mopidy/utils/settings.py b/mopidy/utils/settings.py
index 4c2da4bc..fae4278f 100644
--- a/mopidy/utils/settings.py
+++ b/mopidy/utils/settings.py
@@ -3,6 +3,7 @@ from __future__ import absolute_import
 
 import copy
 import getpass
+import glib
 import logging
 import os
 import pprint
@@ -14,6 +15,12 @@ from mopidy.utils.log import indent
 
 logger = logging.getLogger('mopidy.utils.settings')
 
+XDG_DIRS = {
+    'XDG_CACHE_DIR': glib.get_user_cache_dir(),
+    'XDG_DATA_DIR': glib.get_user_data_dir(),
+    'XDG_MUSIC_DIR': glib.get_user_special_dir(glib.USER_DIRECTORY_MUSIC),
+}
+
 
 class SettingsProxy(object):
     def __init__(self, default_settings_module):
@@ -72,7 +79,7 @@ class SettingsProxy(object):
     def expandpath(self, value):
         value = os.path.expanduser(value)
         value = os.path.abspath(value)
-        return value
+        return string.Template(value).safe_substitute(XDG_DIRS)
 
     def validate(self, interactive):
         if interactive: