How to Build Smart Spending Habits

Smart spending of money is an art. Not everyone have that quality but if practiced, it is an excellent  tool to get total control over your money. To save money, first we have to prevent wasting money unnecessarily. 

Budgeting is a way to take control over money but those who are uncomfortable with budgeting by thinking it is a long and regular process, here are some beautiful ideas for you to spend money smartly.

I still echo the necessity of creating a budget. This would give lots of control over money to your hand by arranging and spending money wisely. Not having a good budget plan considered as a serious mistakes by the personal finance experts.

Here are the tips to follow and become money smart.

1. Do I really 'need' it

Ask this question before you trigger to purchase any item from online or offline. If it is a real need, just go ahead. 

If it is just a ‘want’ wait for next few days. Items falls under the ‘need’ category would be daily use items, groceries etc. 

An example for items into the ‘want’ category would be any new gadgets, attractive dress materials etc.  

Never trigger your buy button based on just attraction because that would come worthless from the moment you lose the interest.

Understand what are ‘need’ and ‘want’

‘Need’ is something you have to have. E.g. Food, Cloth etc.. Remember top up food like Ice Creams cannot consider as need but it is want.

‘Want’ is something you would like to have. E.g. A newly arrived smartphone by its shape and stylish look.

2.  Is something similar already there with me?

Before purchasing anything you want, ask these questions. Do I have anything similar to this product or service? If do so, how this new purchase going to add value over the existing one? 

Unless you are getting a very comfortable answer on how it is going to give you durable advantage over the existing one in your hand, never trigger the purchase to just spend money on unwanted items.

3. Think about purchasing used items

Think about a second hand purchase if the item is not going to use frequently.  Furniture, cars, garage equipment’s, gardening tools, media items such as CD, DVD, books etc., musical instruments, clothing, pets, appliance  and lot many other items can be considered to purchase from used items shop than going for the new. This would save you lots of money

4. How much I am going to use this item?

A very important question each person should ask self before moving to the cash counter or trigger purchase online. Think before the usage of any item you are going to purchase. How much and how long you are going to use the item. 

This would give an idea on whether this needs to be purchased now or not. Borrowing a rarely using item such as driller, grass cutter etc. would be best option that purchasing it as new or used.

5. Can I afford it or fall to debt if buys?

In my personal life, I never purchased any items that required money more than what is currently in my hand. I never purchased any items from money that borrowed from someone or friends or taken as loan from bank or any financial institution. Instead, 

if so, I was generally waiting to have enough money in my hand to purchase such items. This is a right thought and directly deals with avoiding possible debt burdens. Those who are frequently making credit card transaction specifically read this point and act intelligently..

6. Can I wait for little more time?

Before making any purchase especially electronics items, ask this question self at least 5 times. When introducing to market, most of the electronics items come with huge price tags and later the price would get reduced to further low level. 

This reduction would be fast if any competitor introduces similar items to the market. Do not hurry to purchase items that come to the ‘want’ category said above. Wait a little. You may able to save lots of money as a reward to such patience.

7. Try to borrow it from your possible source or take it rental.

Check the possibilities to borrow the required from friends, relatives, neighbors to meet the present requirements. This is specifically good for items like machinery and tools that are not using frequently. 

Use and return back policy on many items would help you to save lots of money.
 

8. Is it seasonal?

Never purchase costly unseasonal items. An example, room heaters comes to use at the winter season and if purchased at that time, it would be costly than purchasing in a summer season. Intelligently identify such items and move forward to purchase in advance i.e. 2 or 3 months prior the season arrives. 

Remember, purchasing food items in season would help you to save money because of getting the item in a lower price. For food items, you would consider not purchasing any non-seasonal items but only seasonal items.

9. Is there any resale value for it?

Once you purchase any items, ensure that have minimum required resale value and demand in the market. This would help you to choose the best items from different brands that offers resale value than other brand.

Here are the major tips to build smart spending habits

1.    Define and follow budget
2.    Purchase food items only at season
3.    Borrow/rental and return any items that is available with any source
4.    Never purchase items just because you ‘want’ that
5.    Electronics items are best to purchase after few months of its original launch.
6.    Items using in season such as cooler, heater etc.. should be purchased well advance before the season arrives
7.    Never purchase items with borrowed money
8.    Think to buy the items after a or few days. You may sometime change your mind and leave that purchase interest.
9.    Items with resale value are best to select and buy.
10.    Purchasing any items that you already have need more attention on the durability.