It’s all too easy to fall into the trap of lending and spending. We all like to have things we can’t afford and lending gives us a fast way to get them. We borrow, we spend, then we find that we have no money and we borrow again.
It’s a vicious circle which is easy to fall into but difficult to get out of. Learning how to say ‘no’ is therefore of paramount importance if you want to keep your finances looking healthy.
How To Take Control of Your Spending
Why We Spend
In an ideal world none of us would be in debt and we would all have everything we needed. But spending isn’t just about need, as we can see from the mountains of unnecessary debt that so many people have to live with on a daily basis.
Taking control of spending means identifying what it is that actually drives us to part with our pennies in the first place.
If you think your spending may be on the verge of getting out of control, it’s time to stop and begin to think about your motivations. Perhaps you feel like something is missing out of your life. Perhaps you’ve previously been used to the “good life” and are finding it hard to say no.
Whatever the reason, don’t let it influence your spending decisions.
Take Control of Your Spending: Understanding Needs VS Wants
Of course, not all spending is motivated by unmet needs. A lot of it comes down to necessity – food, clothes, accommodation, transport etc. All of these things are basic needs which no one should deny themselves. However many people get ‘need’ and ‘want’ confused.
Perhaps you need a car, but you want the very latest model. In this case it would be all too easy to justify the extra expenditure to yourself by explaining it away as a sensible purchasing decision, when it actually is anything but.
There are always ways to reduce the cost of the things we buy, whether it’s by choosing an older model car or by opting for home cooked meals instead of takeaways.
Knowing When to Say No
People who have control over their finances are the ones who have, at some point, learned to say ‘no’ to themselves. They are less likely to get into debt they can’t afford and more likely to be happier in their lives. But knowing how to say ‘no’ doesn’t mean you always have to.
If you need to make a purchase or take out a personal loan, it’s fine to do so as long as you can justify it in a sensible way. This again comes back to want vs need. If you need something and can justify it in a sensible way, then you shouldn’t feel bad about spending the money.
As for the things you want; if you spend enough time being sensible with your finances, you’ll find that you’re able to afford the things you want after all.
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