As you can imagine, I’m fairly frugal and guide our family towards this side of the spectrum. I’m not Mr. Money Mustache (seems to have website issues from time to time) but we’re certainly aware of making good choices and are trying to pass that on to our kids as well. We automatically save about 20% of our income in various devices, which makes us have to be more frugal since we simply have less to spend. I would like to save much more, but honestly, having a wife and kids (even a wife that is more or less in the same general ballpark as me) makes it difficult. I am pretty far on one end of the spectrum versus a more moderate view from my wife, so we settle on this approach for the time being and maybe work towards more saving percentage by a point or two a year and call it life.
I’m not a fan of shopping for clothes, household goods or “stuff” in general. Though my wife enjoys shopping for the sake of shopping in many cases, she either finds really good deals at the local thrift store, or she purchases higher quality goods that last a long time and give her satisfaction. Prior to a non-grocery purchase, the following rule should be applied:
- Is the absence of this item causing me pain, suffering or hardship? Is the absence of this item negatively affecting my life?
- the corollary to this: If I purchased this object or item, would my life be noticeably better? Or would I have a noticeable bump in happiness as a result? Or would this item save me money long term?
You’re at the store, you are evaluating that new watch or purse or or shoes or toy with your kids. The chances are the item will fail both accounts. Advertising has done such a good job of making us feel we are missing out or will not be seen as favorably if we aren’t wearing certain things or driving the right car. What a bad attitude. I’m just finishing up The Success Principles by Jack Canfield (great book BTW) and he mentions the 18/40/60 rule.
When you’re 18, you worry about what everybody is thinking of you; when you 40, you don’t give a darn what anybody thinks of you; when you’re 60, you realize nobody’s been thinking about you at all.
So the question then, if that is the motivation for purchasing something, why are you worrying about impressing someone you likely don’t like that much anyway?
That doesn’t mean you can’t or shouldn’t buy anything, but make good decisions based on value. Maybe that means the more expensive item provides more value in that it is better quality, will last longer or provides more enjoyment versus a cheaper option. Or not.
This weekend, we were evaluating a new bike for Birdsnest as she had outgrown her old one. We checked Craigslist and bike shops. She and I went to check out a $45 used Wal-Mart special bike (15 speed) nearby from Craigslist and while I didn’t oppose purchasing such a bike, it was simply too big as well as needing a little work to make it safe. We passed. Instead of buying a $300 kids bike that was “top quality” at a bike shop (that would last a few years) we went utility and purchased a $100 Huffy at the local Toys-R-Us. Additionally, passing on a trade-in that was free knocks a $30 off that price. This will be a utilitarian bike that will serve it’s duty and we may be able to sell it at the end for $40-50 so I consider this money well spent.
I’m surprised to hear how many people are dropping $50-100 per month on a storage unit for storage of yet even more stuff not in regular use. We did utilize such a unit for a time when we did extreme decluttering prior to our last home sale, but we probably could have ended up selling or donating at least some of the items making a storage unit less necessary. We currently don’t have a unit and do a regular job of donating items to friends in need or to charitable foundations. If you have so much stuff that you need a money sink to store it in (and when was the last time you needed something out of there?), take a hard look at what is stored there and if maybe there’s a way to get rid of the stuff and save $1000 a year (every year) on an unnecessary expense.
Most of the kid stuff you buy is used only for a short while, sometimes only days. Toys and clutter can overtake your life. Instilling these concepts in our children are also important. Our kids get an allowance and are both saving for something “big” to spend their money on. Birdsnest is considering spending a $100+ on an American Girl doll. She was never that into dolls, but got a catalog in the mail (advertisement example ahead). Because of the catalog, she wanted a doll and some clothes so has been saving her money for this. While driving to check out the used bike, we talked a little about this. I explained that she can spend her money however she wants, but to consider how much enjoyment it will bring. I asked questions such as is spending half a years worth of allowance on this item worth it to you? Is it better to save for something more expensive that would be used more? Or is putting it in a savings account for a much larger purchase later a better use of your funds? At least make her think a little. But it’s better to bankrupt an 8 year old when she buys something she’ll regret than a 20 year old with a credit card.
Being one who mostly hates shopping, I certainly don’t appreciate the psychological aspect of it, and the enjoyment it brings people. If that is you, instead of running off to the store to spend part of your day because you’re so booorred, get out and do something. Get a book from the library. Learn to do something new. Practice that THING you purchased a while back. Lift weights. Go running. Play ball with your kids. Try to fill that hole with something that is worthwhile. Spending money on yoga to get your mind and body fulfilled is a probably a better value in many ways than purchasing that next shirt that will sit unused in your closet or tool that gets used a few times a year.
So when you’re sitting there in front of that next potential purchase, use my rules above to really think about it for once, instead of making an impulse buy. Using a list will save you a lot of money in the long run.