Live Within Your Means

Live Within Your Means

Live Within Your Means is a phrase I have heard my parents often say to me throughout the years. I never really thought about it because my parents always lived below their means. I remember them having a Toyota Corolla that lived way beyond its lifespan. They used that car until it wouldn’t run any more and that’s how my parents are. They could have bought a nicer car but did they really need a new car when their old car was still working? They purchase items that they need and don’t necessarily purchase what they want.

NEED VERSUS WANT

Do you know the difference between a need and a want? What you need is basically a necessity (food, clothes, shelter, etc). It is something that you have to have. A want is something that you would like to have (purchasing designer items, gadgets, etc).

DO VALUES PASS DOWN TO THE CHILDREN?

Although I’m my parents’ daughter, I didn’t apply “Live Within Your Means” as a teenager and in my 20s and early 30s. I’m a tech person who loves gadgets. The only problem is that gadgets are expensive. In the past I always got what I wanted. Even if I couldn’t afford it, I would borrow money from the credit card and eventually pay it off with the money I saved.

By my 30s, my spending habits increased to include designer purses, clothes, and shoes. I was able to afford it but wasn’t able to save much. Luckily (or unfortunately for me depending on your point of view) my husband has the opposite view with regards to money. He is very thrifty and only buys what he needs. He also recycles a lot of things like sandwich bags, etc and always seems to find a new use for an old item. His thriftiness balanced out my spending. He was also good at planning and investing our money on diversified assets. Even if you are a saver, remember to be balanced. You also have to learn to enjoy your money on occasion by going on a staycation or purchase something that is reasonable.

SCHOOL OF HARD KNOCKS

When I decided to stay at home full time, that was when I realized that I needed to change my values and try to start saving some money. I had to live on my husband’s income. At that time, I tried to cut as much as I could and later realized that I didn’t need all the designer stuff I purchased over the years. Yes it was nice to have nice clothes, shoes, purses, furniture, etc but in the end I would rather use the money that was spent on me for my kids. Basically my priorities finally changed. From a “me” mentality, it switched to “my family” mentality. I can’t believe it took me several decades to figure it out.

Maybe I was meant to go through all of that. Buying stuff made me feel good but at the end of the day it’s just stuff. I still enjoy the stuff I bought over the years but it’s not as important to me as it used to be. That time of buying was a phase in my life.

I still like nice things, but I won’t go out and buy it immediately. I’ll only buy what I need instead of want. If I still feel I want to purchase an item that I don’t really need, I’ll make sure I save for it before purchasing it. Typically I’ll purchase the latest iPhone. That’s a treat for me. Instead of buying one every year, I typically wait every three years for a new phone and resell my old phone.

When my husband lost his job, we tightened our spending even more. You don’t realize how important it is to have savings until life gets rough and tough and it definitely will. It will be a stressful time, but hang in there. Eventually things do get better. It’s how you handle the stressors (problems) in your life. Figure out a solution and do your best at achieving your goal.

SUMMARY

If you can figure out how to live within your means and actually live below your means sooner than later, your financial future in the long run will be better because you will have a lot more savings. If you can save up for at least a year, that will help keep you afloat while looking for work and will help you during the difficult times.

It’s never too late to start saving. Of course it’s always better to start saving the younger you are so you can invest your money and have your money work for you.

Some people track their expenses and have a budget. For me, I basically ask myself one question, “Do I really need this item?” if the answer is no, I don’t purchase it or purchase an equivalent product that costs less. If I have to save more money, I don’t buy anything that I want. I only buy the needed items. It takes a lot of will power and discipline but it gets better in time. Like everything else, it takes practice. Practice asking yourself that question before you purchase an item and you’ll see yourself purchasing only needed items and will find yourself saving more money in the long run.

Also know your weaknesses and avoid temptation. To prevent myself from wanting things, I avoid the mall especially the Apple store. Yes you can view gadgets you like online, but going to a physical store makes it easier to pay with a credit card when you have the item you want in your hand. If I have to go to the mall, I go straight to the store where I need to purchase the needed item and then go home. Browsing at the mall is a NO NO for me. You’ll eventually come to a point in your life when you realize that you don’t want a lot of things.

Now that my parents are in their 70s I see them enjoy what they have saved and are enjoying their retirement years. I want to live a stress free life as I get older. It will be a shame if I’m worrying about money when I should be relaxing in my “golden” years. Make a change today and try to be a saver if you are spender, so you can live a more relaxing life in your later years.

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