Monday, February 14, 2011

The Discipline of Living with a Budget

This comes up frequently with me: see it, want it, see price, begin justifying the expense. I bet you've been there too. Once you're living on a budget, that initial interrupting gut check starts to take hold every time money starts to levitate out of your wallet. You have a choice to make at that point: stick with your budget, or blow it just this once... because it's really really worth it! Well, if you plan to keep on track to get out of debt or pay down the mortgage or save up for a dream vacation or kids college, you don't have the luxury just now to blow the budget on that something extra.

How To Handle It

If you're good, you've been BUDGETING a small amount to set aside each month in your Play Money account. That's the way to handle these spending urges - plan for them. As I said, though, it takes discipline - both to save and to resist the urge to over spend. The good news is that all of this gets easier as you go along. The first time you are confronted with the urge to splurge, it's going to be tough. Spending is a habit forming activity. I believe people can literally become addicted to it because it feels good to have power to do what you want and that mild euphoria may be the only joy some folks know. (You can, by the way, know real joy by knowing Christ - email me if you have questions.) And so, spending becomes their fix and it's hard to break away from the only source of joy they've known.

For some people, it literally takes a religious conversion to get over this addiction. Some folks have a pathological personality and will swear up and down they've changed, but without a real change of heart, like giving your life over to God, you'll go right back to your hang-up when it suites you. A tremendous number of people around the world who have gotten religion draw strength from their faith in something bigger than themselves. The belief that we can be strengthened by the creator of the universe is very empowering and can really help beat spending addiction as well as other addictions.

So - we need the power to say no, the discipline to say no, and then the plan of action for how we can afford to say yes at the right time without sacrificing our future or the future of our family. It's not something you're going to learn overnight. It will take premeditation and practice to resist compulsive buying again and again till it becomes your new habit.

The Benefits of Waiting to Buy

Like many things that plead with us to jump in NOW (sex, relationships, fitness club memberships) there are not inconsiderable benefits to WAITING. Decisions made in the heat of the moment are often regretted when we sober up and/or calm down. Carefully considering the merits of something, like a purchase, before we invest is well worth while. It gives us time to comparison shop, weigh the real value of what it is we think we need or want and look for less expensive alternatives. I believe that if we give things time, God leads us to the right thing in the right time at the right price.

A couple of good examples from my own life: this weekend I've been really hot on the idea of getting an SSD (Solid State Drive) for my computer. They are NOT cheap. That fact alone has kept me from logging on to a computer hardware website and popping in my credit info. Taking the time to consider the alternatives, I became aware through a contact that there are hybrid drives that combine a SSD cache with a standard hard drive for 80% the performance of an SSD (the main attraction for me is the speed they offer) at less than a quarter the price (SSDs are VERY expensive right now). Given the time to consider my options, I found a much better alternative. The more I think about it though, the more I realize, I really don't need a huge speed boost. The stuff I have works fine, in fact!

I also recall buying my current car. For a while I had wanted something a bit more upscale than the rattly Ford Probe I had been rolling around in for 8 or 9 years. I took my time - about 3 years - saving the money. By the time I was really convinced it was time to say goodbye to the Probe, I had enough money saved to pay CASH for my current ride. That gave me a huge advantage when shopping. I was able to go looking for a good quality used car and cut right through the "I can get you into this car for just $199 a month!" hype and tell the sales guy "Look - I'm going to pay cash. Don't bother telling me about the monthly payment because there won't be any. Tell me how low you can get the total dollar amount on this car out the door, cash in your hand, right now." You could hear pins dropping a block away. It felt REALLY good. And, I had no pressure from the sales guy. In fact, his tone changed. He helped me sort through their selection to find the one car that had the best mileage, wear, tires and ride. He calmed down and took his time to actually be a help to me instead of an unpleasant bump in the road to getting an upgraded car. We both then took our time because he knew he had a sale and I knew I was going to get what I wanted: a quality used car.

Fools rush in. Are you a fool? I didn't think so. Next time you get that itch to buy BUY BUY!!!, remember the words of brother Dave Ramsey: "If you're willing to live like no one else today, you can live like no one else tomorrow." Wait - be patient - consider your options and resist the urge to splurge!

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