Take a day to think about large purchases to avoid impulse buys
“Delaying your purchases for a day gives you time to think about whether or not you really need the items, and it curbs regrettable impulse buys,” advises Marc Diana, CEO of MoneyTips. “Sale items may be an exception to this rule, but even then, question how badly you need the item compared to saving or investing the money you would use to purchase it. When times are tough, and you’re cutting expenses, would you rather have a rarely worn $300 pair of shoes or $300 cash?”
Budgets are freeing, not constricting
Says financial educator Tiffany Aliche, “Keeping a budget allows you to say yes to your goals in a strategic way. If you have a budget, you can save for the holiday, house or car you want to get. You can look at it as ‘No dining out,’ but I see it as ‘Yes to a trip to Paris.’ A budget is not a NO plan, but a YES plan with actual steps towards achieving your goals.”
Budget with the 50/20/30 rule
Lynn Toomey, co-founder of Your Retirement Advisor, suggests following this easy budgeting rule:
Use 50 per cent of your income for non-discretionary necessities like food, rent/house payment, utilities, and transportation.
Put aside 20 per cent of your income for an emergency fund (three to six months’ salary is a good target), retirement, savings, and to pay off any debts.
Use 30 per cent of your income for discretionary (non-essential) spending such as entertainment, holidays and gifts.
Now discover 13 silly wastes of money you don’t even think about.