Many people struggle with the decision of when to save and when to splurge. If you find yourself at a standstill often when trying to make this decision, there are a number of key factors to take into consideration. Yes, you can splurge every so often, but this depends on when and how often you save.
The costs of your daily life can be expensive. This becomes doubly true if you have a family to take care of. This means in order to have money for the extras (like that special hobo bag) you have to save on your day-to-day expenses. This means clipping coupons and seeing what’s on sale at the grocery store.
There is a way that that you can afford the extras, and that is by saving on your daily expenses. Cut costs in the simple ways. Before you know it, these pennies will turn into dollars! Once you have saved enough money for your designer purse, it is only a matter of deciding between hobo bags. Take the time to do your research, in order to find a purse that matches your wants and needs (this is applicable to all special buys).
Consider your partner before making any type of big financial purchase. Being part of a serious relationship, such as marriage, means that your finances are probably intertwined as well. When you are the one responsible for the finances, you are also responsible for consulting on big ticket items such as an expensive jewelry set.
If you are in credit card debt, your first priority should be getting out of debt. As long as you are paying high-interest debt you will not enjoy financial freedom. Get out of debt before you splurge on anything.
If you are not in debt (lucky you!), make sure you do not get yourself in debt because of the urge to splurge. Maybe you have your eye on an expensive exercise machine. If so, instead of financing, save a little more until you are able to make one time cash payment for your purchase.
How are your savings? Do you have any? Part of the savings you create by being cautious on your daily expenses can go into your long-term savings account. This can mean a retirement plan, or a child’s college fund.
Keeping money tucked away for a rainy day is critical. You can however treat yourself for your hard work every now and then. Before you buy, make sure you have done your homework so as not to regret your splurge!