6 Close Guarded Secrets of Spending Less

6 Close Guarded Secrets of Spending Less

There are known ways to control your spending effectively. But first of all, why is spending so important? Rather, why is the habit of spending being discussed time and time again? In simple terms, if you spend more than you earn, you are looking for trouble.

Only spend within your earning capability

Anyone, whether rich of poor who spend too much has a problem. But this could be an inaccurate statement at the first place. To better illustrate, take the example of 2 individuals who are rich and poor respectively. The rich person spends $20,000 a year when he has an annual income of $100,000. He spends 20% of what he earns. Meanwhile, the poor or poorer person spends the same $20,000 amount in a year. But he or she earns less income, which is $50,000 (half of the rich person). This means the poorer person is spending an excessive 40% of his or her salary! It is only accurate to think in terms of percentage.

Other people might give you bad influence

Even your best of buddies or colleagues can do this to you. How is this so? Well, how do you usually react when your friend (who is wealthier than you, but not understanding) asks you out for an expensive dinner at 8? Peer pressure does exist not only in teenagers, but adults, too. Value your own opinion first.

Monitor yourself

The obvious one is t track what you spend. That is because the responsibility that you take dictates your financial future. Whether you make or break, it depends on your money habits. Achieving financial goals can be hard to do, but not impossible.

If you have someone to pay first, that is you

Have you ever heard of paying yourself first? This would mean devoting to a specific amount of savings each month. For example, paying yourself means funneling your income every month to your own bank account savings.

Avoid being a criminal

These products are often associated with crime. You would probably know what they are by now. If you are a smoker, then stop it. If you are a heavy drinker, then drink less and eventually stop it altogether. These 2 habits, if stopped effectively, could save you hundreds of dollars a month easily.

Be a second-hand buyer

Start buying used things. This might sound like a cheap option, but it easily shaves half the actual cost of buying a similar item that is new. The only condition is, you have to check for its quality. If the quality does not differ that much than the new one, then why not?