You've heard of it, but you're not sure what it means: "living within your means." And now, because you want to reach your financial goals (or because you're forced to)... you want to learn how to live within your means. Here's an easy to follow guide to getting started.
To get richer, you'll either have to make more money or spend less. Preferably, you'll find a way to do both and really come out ahead. Since so many of us are over-extended (financially as well as every other way), there's always room for doing better at living within our means.
Here's your quick guide for doing that, one step at a time.
How to Live Within Your Means
1. Prepare yourself for a total change in mindset. Changing the way you live and spend takes, of course, a sea of change in behavior. When trying to implement change first focus on your values and what is important to you. Remind yourself of the long-term goals you've set for yourself, and understand how every behavior change you can manage toward that goal is going to improve your life a great deal.
2. Learn how to delay your purchases for careful consideration. Living within your means entails learning how to avoid all unnecessary spending. The best way to accomplish that is to carefully consider everything you buy. Naturally, what that means is that you should not be allowing yourself any impulse purchases.
This will help you in other ways, too. Far too many people find shopping to be a form of therapy - "retail therapy" it's called. The harsh reality of retail therapy is, however, completely bad for you in many ways. It's bad for your wallet, of course, because you spend money on things you don't need.
It's also bad for you because it only distracts you from facing whatever issues you're experiencing, causing you to need the retail therapy in the first place. What could/should you be doing with all that time you're spending at TJ-Maxx?
Finally, it's bad for you too because inevitably, you'll end up with a whole lot of clutter in your home. Trust the experts (and the minimalists): you'll feel worlds better if your home wasn’t crammed full of stuff you don't need!
3. Use cash. If you're a little rusty with the implementation of tips #1 and #2, try forcing your own hand. Get rid of the credit cards (or at least hide them away and only use them when absolutely necessary) and pay for everything with cash. It will save you from going (further?) into debt, and it will force you to consider whether you can really afford something. At the very least, you'll have to delay your purchases simply because you have to visit the ATM to access your cash. That's right: don't even use a debit card!
If you scan the list of tips you just read, you may notice that we really went to town on one of them: Tip #2, which addresses retail therapy and impulse buying. There's a reason for that. Americans seem to have a terrible time with this problem, and we're not getting any better. We shop too much, we buy too much, and we own too much stuff. Our homes are cluttered, our wallets are empty, and our credit cards are maxed out.
If you're only going to follow one bit of advice on your quest to live within your means, stick with Tip #2. Work hard every day to slow down with the shopping, question every purchase, and spend wisely. If you do that, you'll soon be shocked at how much more money you have!