Money is such a wonderful temptation. It makes us feel powerful, like we can conquer the world. Consequently, when we have it, we want to spend it. This is especially true when the money comes in the form of a seemingly bottomless pit: a plastic card with the word “credit” attached to it.
The only problem is that when you look at your credit card bill at the end of the month, you’ve discovered that you’ve vastly overspent your budget, bringing your account balance back down to zero, where you feel powerless and frail again.
This is a common problem amongst people. It’s a difficult problem for a lot of people to solve. For that reason, we’ve compiled a list of 8 of the easiest ways to teach yourself to live within your means.
Keep Track of Each Purchase
Number eight, know how much you are allowed to spend on each type of purchase. This tip assumes you have a budget that details exactly how much money you can spend on food, gas, entertainment, etc. Review that budget periodically and remind yourself how much is in that budget.
Make a Budget, and Commit To It
Number seven, commit yourself to never go over that budget, even if you think you have a few extra dollars you didn’t use in another category. The purpose of the budget is to help you discipline your spending. Imagining that you have enough in another category to take care of extra spending is justifying the expense. Don’t allow yourself to justify spending more. Commit to the task.
Making the commitment is the hardest part. From them on out, all you have to do is say “no” and look for a creative solution to a problem you may be experiencing. Once you have a firm “no” behind you, you can focus your full attention on solving the problem, which oftentimes makes it easier to solve.
Run Your Own Race
Number six, stop comparing yourself with others. Half of the things pushing many people to buy the latest and greatest is the fear of being left behind. A huge trap is the newest technology. Rather than keep an affordable phone budget, many must have the newest iPhone or Galaxy along with 10 gigabytes of data.
The price of throwing out a perfectly good phone to purchase another one that also makes calls, texts, and accesses the internet can often put you behind a few months on your financial goals. Don’t fall into the trap of “falling behind.” Although it may not be the best and the greatest, this isn’t a race. You are no better a person for buying the newest thing.
Only Spend Cash
Number five, only use cash. You literally can’t overspend your cash. Once it’s gone, it’s gone. Not to mention the fact that you’re always very well aware of how much cash you have in your pocket. Withdraw your budget of spending money and only allow yourself to spend from that budget.
Get Excited About Saving Money
Number four, glory in saving money. Get excited about saving money. If you have enough money at the end of your budget to save more money, it brings home a sense of satisfaction. Not only are you making ends meet, but you’re also able to save for college/a rainy day. Doesn’t that mean you’re successfully living within your means? If you’re a competitive person you can think of this as a contest, you can look at each credit card balance or short term loan that you need to pay off as the next goal to focus on, as you do this you can focus on small victories and relish in the excitement that comes with winning.
Cut Down Expenses
Number three, cut down your expenses. What are you paying for that you don’t need? Are you paying for 10 gigs of data when only 2 will do? Are you paying for a landline on top of that? Do you have cable, Netflix, and Hulu accounts? What about that gym membership you never use. Cut out the expenses you would like, but don’t need. That instantly boosts your ability to stay within budget.
Find Free Alternatives
Number two, find free alternatives. Why spend money on a fancy dinner when there’s a public event that’s serving hot dogs? Why pay for a movie when you can borrow one from a friend? There’s always an alternative that will provide you more satisfaction then guiltily spending your last dimes would.
Track Your Expenses
Number one, track your expenses. The easiest way to ensure you don’t overspend your paycheck is to track what you purchase and for how much. Updating your budget sheet daily and totally all expenses to this point will help you spend under your budget every month. The process is quick and simple. It doesn’t take more than a minute. The benefit of staying out of debt is well worth the price of a half hour spent over a month.
Try these eight easy tips out. You’ll begin to notice a difference in your spending habits and bank account within the first month.