Before Spending
Some questions I outlined to ask myself before spending money.
1.) Is (item in question) a need or a want?
Pretty obvious.
2.) Will (item in question) make me happier?
Splurging is a form of therapy in and of itself. But splurge therapy is exponentially more effective when the target of splurgination is something that will be a long-term source of happiness. For instance, the joy that I feel every time I pull on my leather jacket was TOTALLY worth $45.
3.) Will (item in question) be a positive investment?
I can spend $20-1500 on a tool for a job. But if I am unlikely to need it again, it may be a poor investment. Or if I can use it to make me money in the future, perhaps I can view the expenditure as a profitable investment. Something that I don't NEED, and won't really make me happier, but will actually make me money is probably worth buying.
4. Do I need to spend this much?
Why buy the $450 air compressor when I can get a similar model for $300? Do I need to actually spend hundreds, when I could rent a compressor for $60? Why buy new jeans for $70 when I can get a year-old pair for $7?
None of these questions are solidly "if I can't say yes to this question, this is not worth buying." a bottle of wine doesn't necessarily satisfy any of these questions, but I'll still spend the $8. I think they're worthwhile as a way for me to think critically about my financial choices.
1.) Is (item in question) a need or a want?
Pretty obvious.
2.) Will (item in question) make me happier?
Splurging is a form of therapy in and of itself. But splurge therapy is exponentially more effective when the target of splurgination is something that will be a long-term source of happiness. For instance, the joy that I feel every time I pull on my leather jacket was TOTALLY worth $45.
3.) Will (item in question) be a positive investment?
I can spend $20-1500 on a tool for a job. But if I am unlikely to need it again, it may be a poor investment. Or if I can use it to make me money in the future, perhaps I can view the expenditure as a profitable investment. Something that I don't NEED, and won't really make me happier, but will actually make me money is probably worth buying.
4. Do I need to spend this much?
Why buy the $450 air compressor when I can get a similar model for $300? Do I need to actually spend hundreds, when I could rent a compressor for $60? Why buy new jeans for $70 when I can get a year-old pair for $7?
None of these questions are solidly "if I can't say yes to this question, this is not worth buying." a bottle of wine doesn't necessarily satisfy any of these questions, but I'll still spend the $8. I think they're worthwhile as a way for me to think critically about my financial choices.