Controlling the savage spender in all of us

November 10, 2006 at 11:09 pm Leave a comment

Boy do we love to buy things in this country. If it’s not a new car, it’s a new house or an HDTV. So, how can we avoid buying things we can’t afford and spending more than we make? Here are a few tips that will help you develop the power over purchase.

Tip #1: Wait over night
If it’s a large purchase, wait over night. This is almost a foreign concept in this country.

Tip #2: Consider your buying motives
Is the item a necessity or a want? Too often we confuse necessities with wants. Remember that no amount of stuff equals contentment or fulfillment.

Needs are narrowed down to four items: shelter, transportation, food, clothing.

Tip #3: Don’t buy what you can’t understand
Many Americans buy expensive insurance or investments that they don’t understand. So, learn about an item before you buy it or into it.

Tip #4: Opportunity cost
If you spend your money on an HDTV or new car, you can’t use the money for something else, like college funding or retirement. Consider whether an item is worth the cost.

Tip #5: Talk with your spouse (if you’re married)
This idea is foreign in today’s culture. Too many people have bought into the idea of personal independence. Actually, independence is a great thing. But, if you’re married, the preacher didn’t say you were partners in this business called marriage. He said, “and now you are one.”

Who can find a virtuous wife? For her worth is far above rubies. The heart of her husband safely trusts her: So he will have no lack of gain.”
Proverbs 31:10-11 NKJV

Tip #6: Can you afford it?
What? You mean I shouldn’t buy things I can’t afford? But that’s what credit cards are for. No. 78% of Americans don’t pay their credit card balance off every month. In fact, the average American carries about $8,000 in debt. Why? Because they buy things they can’t afford.

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Entry filed under: Frugal Life, Spending.

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