Spending Wisely
Making smart money decisions doesn’t mean missing out. You can still buy great things and go fun places, just spend wisely. Here are some ways to maximize your money.
- Recognize needs and wants. "Needs" are survival expenses. Wants are expenses you’d like to have, but can live without. It’s important to take care of needs first and then save for the extras you really want.
- Since money is limited, but wants aren’t, learning to prioritize is the key to financial success. Decide which things are most important to you and then work toward those goals. If an item is something you’re really excited about, saving money by cutting back on the not-so-important expenses shouldn’t be too hard.
- When prioritizing, realize that nothing comes for free, everything has an opportunity cost. Every time we make a choice, we have to give up something else. When choosing where and when to spend your money weigh the pros and cons to figure out which situation you’ll be happiest with.
- Sometimes it’s necessary to practice delayed gratification. That means putting off a purchase until you can afford it. Advertisements constantly encourage you to spend; so how do you avoid the pressure? If there’s something you want, but don’t need, wait a few days. If you still want it, and can afford it, then go get it. Many times you’ll decide it’s not worth it.
