Link Your Desire to Spend Money With a Financial Goal

If you are looking to buy a home, most experts suggest saving at least 20% on your down payment . This is a simple goal for a big purchase, but it is designed to protect you financially. You can use the same concept for other purchases as well.

The financial website Financial Samurai explains this concept:

By holding on to your desires, you are forcing yourself to achieve certain financial goals before wasting money. You may simply find that by spending all this time earning or pursuing a goal, you will lose the urge to spend money! I’ve already set up a midlife crisis investment fund for a fancy car I doubt I’ll buy.

This strategy has several advantages. First, it makes your spending more conscious. You don’t just waste impulsively – you have time to think about your purchase. Secondly, it helps you achieve whatever goal you are working towards. For example, I am not good at negotiating. As an incentive, I once postponed buying a new phone until I asked for a pay raise. This prompted me to muster up the courage and ask. Finally, you enjoy your spending.

While Financial Samurai mainly discusses this rule in terms of high value items like a car, I think it works well for small expenses as well. I used this strategy when I had student loan debt. For example, if I wanted to enjoy a delicious meal in a restaurant, I used it as a reward after paying X amount. These rewards can also keep you from pursuing your goal .

To learn more about this strategy, follow the link below.

Simple Ways to Increase Savings and Control Expenses | Financial samurai


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