This post is all about cheating!
Cheating on your budget that is.
Consumer Mindset
Sticking to a budget can be difficult. Sometimes a little cheating can be beneficial. Everything about our society today is centered on consumerism. Every year electronics companies come out with a new upgrade to their products. The sole purpose of which is to get us to spend hundreds of dollars on a new model that isn’t really that much better than the one we already have.
Or take targeted marketing strategies. Companies now know so much about us it seems like just when you buy one item you start seeing ads for every similar and related product. Every time I search a product on Google, within a day I’m seeing ads for it on Facebook.
Eventually, this relentless bombardment of ads wears us down.
That’s why this constant upgrade/marketing strategy works so well. As humans, we only have a limited amount of willpower, meaning we can only fight the temptation to not buy something for so long.
And the longer you fight it, the harder a mental exercise it becomes. That’s why sometimes it’s not a bad idea to go against your budget and splurge a bit.
Giving In
I’m not saying to just give in every time you want something. That would go against the financial discipline I’m trying to promote.
Instead what I’m suggesting is that if you have been following your budget well and you have some extra money, making a bigger purchase can give your mind a reprieve from the savings mindset and will recharge your willpower for all of those other daily spending temptations. Once you get that purchase out of your system, you can focus on saving again.
But before you pull the trigger on that purchase, think through the following questions.
Is this a substantial purchase?
If you’re breaking down to buy a cup a coffee, instead of recharging your willpower, you may actually be starting to create a bad spending habit. Making a lot of small purchases is one way to lose sight of how much you are really spending.
While a $5 cup of coffee may not seem bad, a cup every day costs you $1,825 a year. So if you buy something small, you may think it’s ok to buy them more frequently. Plus the goal of making a splurge purchase is to reward yourself for savings and buying something small that you may only use once or twice probably won’t have a high reward value to your brain.
Do you really want this?
Don’t buy something just for the sake of buying it, make sure you really want it.
You are not going to splurge that often, so make sure you’ve really thought about it. Typically before I make any larger purchase I’ll do a bit of research to make sure the item or experience fits what I’m looking for. Then I’ll think about it and wait for a few weeks or months.
If I completely forget about it then I know I really didn’t want it. But if I keep coming back to it or researching it more, then I see it as a good item to buy as a reward.
Can you buy it with cash?
Don’t splurge on buying something on credit. If you don’t have the cash in your account, then you really haven’t been following your budget.
Remember you should be budgeting some discretionary spending each month. It’s when you don’t spend all of this money each month that you use that surplus to cheat a bit and splurge on one larger purchase. So even if you know you really want something, if you can’t buy it with cash, don’t buy it.
Now Back to Saving
Again, I’m not suggesting that you should go out and buy something on the spur of the moment.
Make sure you really have been following your budget and that you have the extra cash to buy it.
Use this momentary savings lapse as a reward for the months and years of fighting against all of the little purchases that used to drain your savings. Once you get the urge to spend out of your system, you’ll be refreshed and more focused to save going forward.
What’s your favorite thing to splurge on? Let me know in the comments.
Leave a Reply