Doing This One Thing Could Save You Thousands Every Year
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As someone who has lived frugally for more than 21 years, I have come to discover so many tips and tricks about how to save money, live on a budget, get amazing deals, and so much more. But with everything I’ve learned, there really is one thing that stands out. And, I’m guessing it will surprise you because it really is a basic concept. It’s a basic concept that packs a huge punch. And, once you know it, this tip can save you thousands every year.
Financially matters can really get messy. Being financially savvy does take work, after all. It is important to do things like create a budget, shop smart, and handle the money you have wisely.
But, I want to make things even easier for you.
Short and sweet, plain and simple, doing this one thing could save you thousands every year.
Are you ready for it?
Here it is.
Live on less than you make.
Yep. See what I mean? It’s a basic concept.
However, you may already be thinking that it might be a basic concept but it is not one that is always easy to implement.
If these are your thoughts, then you would be right on. It is basic and so difficult to put into action at times.
But, when you do, here is how this one thing could save you tons of money each year.
You will avoid debt
If you’re living on less than you make, you won’t be buying anything that you can’t outright pay for. Of course, most have housing costs, but take it from someone who no longer has a mortgage, not paying for housing costs anymore is pretty awesome!
Without debt, you also won’t be paying interest on your credit cards and loans. Some people I know have multiple credit cards that they keep using again and again. Others take out loans for various things such as a remodel project, a new car, or a vacation, none of which they can afford without the loan.
While this may seem like a nice thing at the time that you are buying the new car or while you’re on that vacation, you’ll pay for it later- literately and figuratively.
You can read more about our journey to becoming debt-free HERE.
You won’t have to stress when it comes time to pay bills
Who likes paying bills? Really no one does. However, it is so much easier when you’ve actually got what you need to cover them. Due dates come within stress, strain, and overwhelm when you’ve got what you need.
You will avoid buyer’s remorse
You know what this is, right? Buyer’s remorse happens when you buy something that you can’t really afford to buy, but you find justification for it in some way. You might find yourself saying, “Oh I worked really hard at work this month,” or, “I deserve this.” Later, once you’re home and thinking about it, you feel bad for buying it at all. Try sleeping on it for a few before you buy. This helps you truly determine the difference between a want and a need.
If you’re married, you will both automatically be on the same financial page
Have you ever purchased something and then felt as though you needed to hide that purchase from your spouse? This is similar to buyer’s remorse. If you know that you can’t really afford something that you bought, you really don’t want to hear the same thing from your spouse. So, you might hide it. Living on less than you make means you lessen the likelihood of having to hide purchases from your spouse.
You’ll learn how to become a pro at creating a budget
Most likely, your income will fluctuate at times for a variety of reasons. But, when you are committed to living on less than you make, you simply must adjust your budget as your income decreases at times. The really cool thing is to not change your spending habits a ton once if your income increases. This is one of the tricks we implemented when working towards paying off our mortgage.
Read more on why you want a budget and how to create a budget.
You will have an easier time discerning the difference between a want and a need
This is an important distinction to make, but it is one that many people don’t know how to do. Living on less than you make means you may very well have to forego things that are just wants if your income doesn’t allow for it.
When financial hardship comes, you will be able to handle it
No one really likes to think this will happen to them. But, the truth is, it just might. This way if it does, you’ve got a cushion to fall on financially. If you are already accustomed to spending habits that fluctuate at times as your income fluctuates, it will be something you’ve got experience in doing if that income falls right off.
If you’re a parent, you will be teaching your kids invaluable skills
I’m a parent (8 times over!), and my kids have become so financially wise just from being exposed to the way we do and don’t spend money. Our kids see us carefully weigh everything we buy whether it is things we need or things that we really don’t need.
The truth is, our kids watch what we do, both good and bad, and they learn from that. If we practice good financial skills, they will see that and learn it. Then they will take these skills into adulthood with them.
Living on less than you make can seem inconvenient at times. However, if you keep focused on these benefits, it will make it easier to spend less and save more. It’s never too late to start living this way, and every little bit counts to making a huge difference in your overall annual financial picture.