It can be a challenge to budget your expenses, especially when credit cards, home loans, and discounts are there to “help” you purchase many things. While “treating yourself” once in a while isn’t a bad thing, it is still crucial to assess if your income covers your necessities and occasional wants without making your bank bleed all the time.
Take a look at these five tips to get you started on living within your means. Soon, your income will cover your lifestyle and help you evaluate your needs and wants.
Track Your Expenses
Before you set any financial goals, it is essential to know your cash flow after taxes and how much you’ll need to spend for your groceries, bills, rent, housing loans, and monthly subscriptions. Know your expenses and keep track of which ones take a chunk of your income.
Create a budget plan to allot the amount you’ll need for your payables. Record your purchases so you’ll see how much you’ve spent previously, especially if you tend to make unplanned purchases sometimes. Tracking your expenses will help you set your financial goals and save for the future.
Assess Whether You Really Need It
While getting something new is rewarding and satisfying, you must still evaluate whether the item you plan to purchase is essential.
Suppose you want to invest in a new TV because a new model is out, but you still have your older TV that works perfectly fine. If you’re torn about buying the new TV or not, wait for 48 hours before swiping your card and waiting for the company to bill you. In that period, you may change your mind about buying a new TV, keeping your old one until it wears out, and saving a lot of money.
Assessing whether an item is a need also helps you reduce objects that may overwhelm your home. Having a lot of things occupies a lot of space, making your home narrower and more cramped. Take a look at your possessions and check whether you really need an extra of those items. Residents of a condo in Taguig may do this method to declutter, donate, and sell excess items to clear their space and make more room for what matters.
Get Groceries
Dining out is fun, but can take a considerable chunk of your savings. It will be challenging to accomplish your financial goals when you constantly eat out or have food delivered. Plus, you may also be damaging your health in the long run with all the processed foods you’re eating.
Save money by getting groceries. It may seem pricey to get a food supply for your home, but you’ll be surprised at how much you’ll save by ditching takeouts and dine-ins. You’ll also notice that the cost of one outdoor meal may buy you groceries that may span days.
Do It Yourself
Aside from eating at home, there are other things you can do for free in the comfort of your own space. For example, instead of getting expensive drinks outside, make your own iced coffee, frappuccino blends, and milk tea in your kitchen. Use your toaster to make grilled cheese sandwiches. In addition, you’ll find many beginner-friendly recipes online to help you create your favorite dishes on a budget.
Instead of renewing that monthly gym subscription you’ve only used once since applying, do your workouts at home. You’ll find many free exercise videos online to help you stay fit and achieve your body and weight goals. You’ll also save some cash by canceling your gym membership and working out at home.
Reward Yourself Once in a While
While living within your means entails proper budgeting and choosing needs over wants, rewarding yourself once in a while will encourage you to maintain your frugal and practical lifestyle.
Besides budgeting your money for groceries, bills, and other payables, plan a budget for an item you really want to invest in. This could be a new phone, a vacation overseas, or a new condo unit or house and lot.
You may also treat yourself to smaller things such as upgrading your wardrobe or buying a new kitchen appliance. Treat yourself once in a while so you’ll develop the habit of saving money and only purchasing things when you can pay them in full.
The bottom line of living within your means is to find contentment and joy with what you have right now. Sure, it can be nice to have the latest gadgets and fashion pieces, but it is still crucial to save for a rainy day, make the most of what you have, and invest in what you deem worthy. Learn from these five tips to help you use your finances wisely.
