Living within your means can be tough sometimes what with credit cards, online shopping, and irresistible offers tempting you at every nook and corner.
If you do find you overdo it on the shopping once too often, it’s time to take a good, hard look at your lifestyle and recognise the signs of impending trouble.
1. You succumb to peer pressure
People want to feel a sense of belonging whether its with family or friends. And often times this involves attending social gatherings where you’ll have to spend money.
While having fun occasionally is encouraged, do take into account your finances before you hit the club or that fancy new restaurant.
It’s important to check how much you have left in your account and whether you can you afford to spend it. Also remember that you and your friends may have different ideas about what is considered expensive.
Let your friends know if you can’t afford dining in an expensive place. They will understand, after all, they are your friends. Do not let the fear of missing out influence your thoughts.
2. You cannot afford to pay up your credit card in full
Most people have a credit card. But financial problems crop up when a person does not know how to use it responsibly.
Constantly making purchases with your credit card is a sure-fire way to get yourself into debt. The incentives that credit card companies offer do not make it any easier.
If you find that you cannot afford to pay up your credit card balance in full every month, maybe it’s time to cut up that card and switch to cash.
Start spending less so that you can slowly pay off the balance. Also start using cash more often.
3. You don’t have a habit of saving
Saving money for a rainy day is important. Medical emergencies and sudden expenses can deal a huge blow to your bank statement unless you have savings to tide you over.
If you find that you cannot save at least 5% of your income at the end of each month, you might be living well beyond your means.
Start focusing more on saving so that you can build up for the future. Spending less each month on unnecessary services and products is the first step in the right direction.
4. You’ve bought a car that’s too expensive
Cars are a big purchase. While it is a good idea to get a car loan, remember that some are downright unreasonable. Do not purchase a car you cannot afford. You do not need a luxury car to get to work every day.
The answer to this problem is pretty simple: Think about your current financial situation and ask yourself if getting a car is a good idea.
Better yet, ask yourself if you really need a car of your own. Many cities have great public transportation systems that are a good alternative to owning your own vehicle. This is also good because you can help cut carbon emissions and save the environment.
5. You’re always borrowing money
Sometimes you really have to borrow money because of an emergency. But asking for loans on things you do not need can be annoying to other people, who might even try to dodge your texts and calls to avoid you altogether.
It’s time to be honest with yourself and live within your means. Don’t trouble others just because you want to live a lifestyle that you cannot afford.
Talk to your friends and family if you really need some quick cash, not for buying the latest gadgets or eating at expensive restaurants.
Be responsible when you ask for a loan because you might even damage the relationship if you ask too often.
This article first appeared in The New Savvy.
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