Spending more money than we should is far too easy. Years ago, people generally spent what they had. The only thing they customarily took out a loan for was a house and occasionally, a car. However, modern times allow us to buy nearly anything we want on credit and pay for it later. Credit card companies pursue college students and a young workforce relentlessly. As long as that credit rating stays positive, there is hardly a limit to the borrowing and spending habit.
Over-spending is so easy. We sign up for a credit card. The credit card company offers perks and gifts, like 0% APR for the first 12 months or $100 cash back for the first $500 we spend. It seems like the perfect marriage. Each party wants something from the other one and they are willing to give something in return. The lending institution gives a credit limit; the borrower gives their hard-earned money each month to pay what they spent plus interest.
What happens when we spend more than we can pay each month? That is when the trouble starts and the interest adds up. Soon enough, inexperienced or financially-irresponsible individuals often find themselves saddled with thousands, if not tens of thousands of dollars, in credit card debt and interest rate payments nearing 20%. We are perhaps a little discouraged; the credit card company is thrilled, as long as we don’t stop paying altogether. Learning to say “No” and sticking to your budget doesn’t have to be so difficult. Here are 10 easy suggestions to still have fun and stop over-spending at the same time.
Decline An Invitation or Suggest Another Plan
Sometimes we hang out with family and friends who either have a higher salary than we do, or are just plain risky with their money. They want to go places, go shopping and do things that we can’t always afford, so we use a credit card and the debt cycle begins. In order to save ourselves from complete bankruptcy, we have to learn how to say no in a tactful way and mean it.
One obvious solution is stating that we are busy when the “gang” is getting together at an expensive restaurant. Yes, we may miss out on some good times, but we don’t have to pay for the meal for six months either. Another solution is to suggest a less expensive place to go or another event that works for everyone. Instead of dinner, suggest a cup of coffee the week after or a lunch date.
Budgeting Your Money and Seek Understanding
To live within your means isn’t always fun. We have to set yearly, monthly and weekly budgets to pay the bills, buy necessities and still have a little left over for some fun and savings. Generally, if you tell someone that a night out or a product their friend or relative is selling is simply not in your budget, they will understand.
However, if they try to push you into it, kindly repeat again that as of right now you cannot handle the expense. Explain that you are saving money instead of practicing excessive spending. If they are truly supportive of you and your financial well-being, they will understand. If they don’t, then that is another separate issue beyond financial control and you may need to reevaluate the kind of friend they may be.
Avoiding Fundraising Purchases and Changing Conversations
Overall, most of us have a charitable heart and when living on a tight budget or attempting overall debt reduction, charity has to begin at home. Non-profit organizations, school fundraisers, and even charities we have a conviction to support have to take a back seat as we reduce spending. When approached by one of these well-meaning organizations, you can often redirect the conversation toward how difficult it is to find money during these tough economic times and wish them luck with their endeavors.
It is pretty hard for a fundraiser to keep pressuring you after this type of exchange. Another method may be to volunteer your time instead. Most organizations or non-profits are likely to appreciate your time more than money as good, dedicated volunteers are hard to come by.
Avoid Guilt and Don’t Cave To Peer Pressure
As difficult as it is, we sometimes just have to say no. Excuses can be made, conversations diverted, less expensive plans suggested, but that doesn’t always work. There are times when saying “No” is the only way to handle the situation. Don’t fold to peer pressure. Don’t feel guilty. We all have bills to pay and that means making sure we have enough money during the month to fulfill our financial obligations.
Tell your friends and family that you are sticking to a budget to reduce debt or stay debt-free. Identify times when you are spending money frivolously just to keep up with the neighbors. When you have more money in your pocket or your emergency fund is growing, you will definitely breathe a sigh of relief.
Don’t Miss The Fun and Meet The Group Later
Being frugal does not mean that you have to alienate yourself and miss out on what your friends and family are doing. Maybe you don’t want to go to an expensive theme park, but there is no harm in meeting the group for a burger at the end of the day. Having dinner out with friends doesn’t have to mean a four-star restaurant. Inviting a group of people to your home for a barbeque and asking everyone to bring a dish to share is a wonderful way to spend a summer afternoon. Get together with friends at the park, bring a picnic and enjoy some outdoor sports together. The ways to enjoy each other’s company without spending a fortune are countless, so be creative.
Once you learn the tactics and rules to saving money and spending less, the world will become a much brighter place. Your bills will be paid on time with money left in your pocket. What a relief not having to worry about running out of cash before the month is up or even the next paycheck is due.