Can't stand when you really need money and your wallet is empty? Regardless of whether you have little or a lot of money, it is always wise to spend it wisely, so as not to waste it. Follow the tips in this tutorial to reduce expenses in key areas and to take a more informed global approach when shopping.
Steps
Method 1 of 4: Basics of Expense
Step 1. Create a budget
Keep track of your expenses and income so you have an accurate picture of your financial situation. Keep your receipts or write down your purchases in a notebook as you make them. Also check each month's bills and add them to your budget.
- Break down purchases by category (food, clothing, leisure, etc.). The sectors that have higher monthly expenses (or those that seem particularly expensive to you) are the ones you need to pay more attention to in order to try to save.
- After keeping track of your purchases for a while, set a monthly (or weekly) limit for each spending area. Make sure that the grand total you plan to spend is less than the income you are earning in that period and try to keep some margin that you can set aside if possible.
Step 2. Plan your purchases in advance
Impulsive shopping can hugely inflate your spending. Write down the things you need to buy while you are still at home and in a calm spirit.
- Take a preliminary tour of the stores before making any purchases. Observe and pay attention to the different prices that you find in one or more points of sale. Go home without buying anything and decide which products to buy when you go shopping the second time. The clearer you have ideas on what to buy, the less time you will waste in stores, plus the fact that you will spend even less!
- If you start with the spirit of managing every purchase as if it were an important choice, you will surely be able to make the best decisions.
- Don't accept the free samples that are offered to you and don't try something just for fun. Even if you don't intend to buy it, just trying it can push you to make up your mind and buy it now instead of weighing it down.
Step 3. Avoid impulse purchases
While it's a good idea to plan your purchases in advance, it's terrible to buy something on the spur of the moment. Follow these tips to avoid making a purchase decision for the wrong reasons:
- Don't look at window displays or shops just for fun. If you are about to buy something just because you find it fun to shop, you will probably find yourself spending too much money on useless things.
- Do not shop when you are unable to evaluate carefully and thoughtfully. Alcohol, certain drugs or sleep deprivation can interfere with the ability to make sensible decisions. Shopping when you're hungry or listening to loud music can also be a bad idea, if you don't stick to your pre-set shopping list.
Step 4. Shop when you are alone
Children, friends who love shopping, or even just a friend whose tastes you like can affect your decision to spend more money.
Do not follow the advice of the shop assistants. If you want to ask a question for information, listen politely to their response, but ignore any advice on the purchase decision. If you see that they insist on selling you a product at all costs, leave the shop and come back later to make your decision with greater peace of mind and without pressure
Step 5. Pay the full amount in cash
Using credit cards increases spending for two reasons: you have more money to spend than you normally would, and the fact of not physically seeing the money coming out of your hands does not make you fully understand that it is a "real" purchase. ". At the same time, paying with a debit card or a revolving or credit card does not make you understand how much you are really spending.
Don't carry more money than you need. If you don't have the extra money, you can't spend it. For the same reason, withdraw the amount of your weekly budget once a week, rather than filling your wallet every time you want to go out
Step 6. Don't be fooled by marketing
It is very easy to be influenced by external influences that directly involve the sums that are spent. Always be very careful and try to know all the reasons that can attract you to buy a product.
- Don't buy anything by being convinced by an advertisement. Whether you see them on television or on the product packaging itself, handle ads with skepticism. They are specially designed to encourage you to spend money and do not give you correct and complete information on the article.
- Don't buy something just because it's on sale. Discount coupons and special offers are great solutions if they concern products you already plan to purchase; but getting something you don't need just because it's 50% off doesn't save you money.
- Know the tricks of the prices displayed. Be aware that "1.99 euros" is basically the same as "2 euros". Evaluate the price of an item on its real merits and not because it is "cheaper" than another option of the same brand (by greatly devaluing "the least convenient deal", someone could lead you to buy additional options that are not actually necessary).
Step 7. Wait for the bargains of special offers and discounts or sales
If you know you need to buy a particular item, but it is not essential today, wait for it to be offered or look for discount coupons or special offers for that item.
- Use discount coupons or wait for the moments of special offers alone for those products that are absolutely necessary or that you still decided to buy before they were offered with the discount. People are easily lured into buying a product because it is cheaper even if they don't really need it.
- Buy products that are only useful at particular times of the year during the off-season. A winter coat should be much cheaper when purchased during the summer season.
Step 8. Do your research
Before making expensive purchases, find out online or read consumer reviews to understand how to get the most benefit for the lowest price. Find the best product that fits your budget, will last longer and best meet your needs.
Step 9. Take into account all costs related to a product
Especially when it comes to items of great value, in the end you will spend much more than the single price indicated on the label. Read all the information and calculate the total amount before deciding to buy a particular asset.
- Don't be fooled by lower monthly payments. Always calculate the total amount you will pay at the end (monthly payment multiplied by the number of months up to the total balance) to evaluate which is the cheapest solution.
- If you are going to take out a loan, calculate the total interest you will have to pay.
Step 10. Give yourself some occasional inexpensive concessions
It may seem like a paradox (it is in fact buying something that is not necessary, exactly the opposite of what is recommended so far in this tutorial), but, in reality, it is easier to keep the commitment to meet the spending goals if you allow yourself some "exception to the rule" every now and then. Try to make a sudden and unnecessary expense, by doing so you will probably avoid giving in at a later time (blowing up your budget) and spending much more than you should.
- Save some money (not too much) in your budget for these occasional gifts. The aim is to give yourself a small reward to keep your spirits up and avoid more insanity and waste later on.
- If you are generally used to expensive concessions, find cheaper alternatives. Take a relaxing, aromatic bath at home instead of going to the spa, or grab a DVD of a rented movie instead of going to the movies.
Method 2 of 4: Clothing expenses
Step 1. Buy only what you actually need
Look carefully at the wardrobe and evaluate what you already have. Sell or give away those clothes that you no longer wear or that no longer fit your body, in order to have a better idea of your situation.
Keep in mind, however, that emptying the wardrobe a little is not a valid reason to buy other clothes. The goal is to understand what clothing you already have and what you need instead
Step 2. Know when to spend more to aim for quality
There is no point in buying the most expensive brand of socks, as they wear out quickly. However, spending more money on a higher-quality, longer-lasting pair of shoes can save you money in the long run.
- Remember that the price does not always guarantee quality. Look for brands that tend to produce more durable goods over time, rather than assuming that a more expensive brand is necessarily the best.
- For the same reason, if you can, wait for the item you need to be on sale. But remember, as mentioned above, not to use the balances as an excuse to buy unnecessary items.
Step 3. Buy in thrift stores
Sometimes you can find incredible quality items in some second-hand clothing stores. At the very least, you should be able to buy clothes at a fraction of the price of brand new ones.
Thrift stores in wealthier neighborhoods usually receive higher quality donations
Step 4. If you can't find a thrift store in your area, opt for the cheapest non-branded items
Remember that a dress is not of superior quality just because it bears the logo of a famous designer.
Method 3 of 4: Food and Beverage Expenses
Step 1. Make a weekly shopping list
When, in your budget, you have previously established a quota for food and calculated the exact meals you consume, you know what you need to buy to prepare them.
In this way you not only avoid making impulsive purchases at the supermarket, but also avoid wasting money on buying extra food that you will then have to throw away because it is spoiled (this is generally a rather significant share in the spending of many people). If you find yourself throwing food away, reduce the size of the meals you plan to consume
Step 2. Learn ways to economize on food.
You can find many ways to save money by shopping for groceries, choosing those products that are on offer, shopping at discount stores, and so on.
Step 3. Eat as little as possible in restaurants
Eating out is much more expensive than cooking your own food at home, and you should never go out on a gut feeling if you're trying to save money.
- Make lunch at home and take it to work or school.
- Fill a bottle with tap water at home, instead of buying bottled water, which is much more expensive.
- Likewise, if you drink coffee often, get yourself a cheap mocha and save money by making it at home.
Method 4 of 4: Save Cash Wisely
Step 1. Save
Making thoughtful spending choices goes hand in hand with saving. Try to set aside every month, as much as possible, by creating a savings account or another type of reliable and cumulative investment that can guarantee you some interest. The more money you save each month, the better your overall financial well-being will be. Which basically means spending money wisely. Here are some ideas you can consider:
- Set up an emergency fund.
- Open a savings book or start a pension fund.
- Avoid unnecessary fees for certain services (credit cards, etc).
- Plan your meals for the week.
Step 2. Get rid of expensive habits
Compulsive habits, such as smoking, drinking, or gambling can make you spend all the money you save with incredible ease. If you manage to eliminate them from your life it will be a boon to your wallet and your health.
Step 3. Don't buy things you don't need
If you are unsure of a particular purchase, ask yourself the following questions. If the answers aren't all yes, it means it's not that essential and you shouldn't buy it.
- Is this an article I must always use? Make sure that what you buy is not a "duplicate" and that you can make the most of it.
- Do I already have something else that serves the same purpose? Carefully consider specific or technical products that can be replaced by simpler items you already have. You probably don't need ultra-specialized kitchen equipment or special clothing to train when a pair of sweatpants and a shirt are just as good.
- Does this object allow me to improve my life? This is a tricky question, but purchases that encourage "bad habits" or lead to the neglect of important aspects of life must be avoided.
- Will I regret not buying it?
- Will this item make me happy?
Step 4. Cut down on hobbies
If you've taken out a gym membership but aren't actually using it, don't renew it. You were a passionate collector but now you are not so enthusiastic anymore? Sell your collection. Dedicate your economic resources and your energy only to those sectors that you are truly passionate about.
Advice
- It's definitely a lot easier to stick to a budget if the whole family is involved.
- Keep checking the market if you find better offers and bargains. Many services (telephone, internet, cable or satellite TV, insurance, etc.) offer better conditions for new customers in order to attract them to their company. If you manage to alternate between the various competing companies, you will often be able to obtain the most competitive and convenient conditions.
- When you compare two cars with each other, it also calculates how much more you spend on petrol or diesel, if you opt for the less efficient model.
- Avoid buying clothing that can only be washed in the laundry. Always check the labels before buying clothes. There is no need to continually spend money to dry-clean them.
