Man’s unlimited wants and needs make ‘careful spending’ a difficult task for everyone. Though money would naturally be spent to satisfy a need, it becomes a more viable asset when such need is well thought out before spending on it, after which you make a quantitative expression of a plan which would last the period of time you want those needs to be satisfied.
When money is not available, many needs flow through one’s thoughts, making one feel financially handicapped, depressed and sometimes frustrated. However, once money becomes available these needs seem to disappear from the mind and you find yourself spending on things not budgeted for.
Financial experts say in such cases one ends up spending more money than necessary. This is the major reason for extravagant spending.
To spend wisely, consider the following steps:
Create a plan
It is essential to plan before your income arrives and avoid planning beyond your income. Plan and then make reserve. This helps to withstand problems and emergencies, and keeps you from borrowing and piling up debts.
While doing this, do not forget to plan your spending according to your resources and important needs. Make a list of things needed and stick to it when money is available.
This plan should not be kept in thoughts because there is a probability of it evaporating at the arrival of money, hence, it should be written down and adhered to.
A lack of planning and budgeting results leads to spending on unnecessary things.
Satisfaction of pressing needs
Things that are needed most should be satisfied first before the others. That is, highly pressing issues should be at the top of the list.
For instance, you want to buy an expensive bracelet and a wrist watch. A bracelet portrays no economic value or purpose than the wrist watch, so you can put that aside. Do not buy things that attract your eyes when they serve no positive purpose.
Spending within your means
This implies spending within your capability and strength and avoiding every extra cost that is not budgeted. Buy things you have already listed out according to your scale of reference.
Contentment
Be pleased, proud and satisfied with whatever you have, big or small. Contentment with your salary allows you spend prudently according to the limit of your income.
It takes discipline to be contented in spending. When you are not disciplined in spending, you discover that you buy little or buy what is worthless.
Satisfaction helps you to ignore irrelevant purchases, focusing on needs and making progress within your financial capacity.
A lack of this major component results in extravagant spending.