When talking to extremely wealthy people or hearing wealthy people talk, I have noticed that the top one percent often care more about how they spend their money on medium sized purchases instead of huge purchases. I’ve heard of millionaires that wouldn’t think about buying a Bentley but wouldn’t rock a $100 pair of shoes because they’re too “expensive.” I also know a person that makes an above average salary that lives in a trailer park because they don’t know how to stop buying shoes or save up for them. In conclusion I believe that the most important form of spending is your medium sized expenses. Median sized purchases are easy to spend more on than you intend as well as being expensive enough to impact your worth over time. Meaning, what you spend on the medium sized stuff is probably going to dictate a lot of your total worth. So before we begin, I am legally obliged to tell you that I am not a financial advisor and this article is only for informational purposes.
It’s weird to think about, but in some ways a car is easier to save up for and buy. No average person has ever gone to a car dealership and been tempted by the car seller to buy two cars. However, I think everyone has gone into a store to buy clothes or something like clothes and been tempted into buying a product they don’t want because of a sale or a buy one get one free deal. Over the years this habit will start to show itself, and you will realize that instead of buying two cars from the dealership you might as well have bought five in the amount of money you’ve wasted on stuff you generally didn’t want anyways.
So how do you avoid buying extra stuff at the store, deicide what you really want, and save up for these medium sized expenses? The first and most important rule to remember when buying anything is to remember to ask yourself if you really want it. Next, make sure you know how to get a good deal. If you’re shopping online, a browser extension that searches for deals is the best since it can search the web for coupon codes. However, never fall for a “fake sale”. A “fake sale” is a sale that goes up in price instead of being cheaper like the company wants you to think. For example, I’ve seen a thirty dollar product with a 40% off deal ($18), turn into a ten dollar off deal (20$) on a company’s “mega sale” on Easter. I see this trend mostly on Black Friday, the media publishes a report about the best deals, but in reality Black Friday usually has the highest prices of the year. From what I’ve observed, the cheapest weekend of the year is actually the two weekends right before Black Friday. Always check prices before companies have big “sales”, this way you can guarantee a good deal.
Now for the hardest part: saving up. When shopping for unnecessary items, I would say that using a credit card or debit card is not a great idea. Although it is very important to build up your credit score and clothes can be a great way to slowly do this, it is too easy for people to spend more than what they want to spend when they have their entire bank account available. It’s very easy to see one-thousand dollars in your bank account and think you can afford a twenty-five-dollar pair of socks that you don’t need on top of the one-hundred- and fifty-dollar pair of shoes. This mentality is the same mind-set that causes pro-athletes to go broke just a couple years after their playing years.
Setting a budget on a card is nearly impossible. The bank can help you by setting an expenses limit, but that can be extremely annoying and, in the end, could hurt you more than help you if you’re spending the budget daily. Instead what you should do is buy in cash or use a separate online bank account. If you are going in store to buy something, always use cash. Although cash does not provide any interest and therefore loses money over long periods of time, by only bringing one-hundred dollars to the store you can guarantee that you will only buy the one-hundred-dollar product. Doing so guarantees that you will only get what you want and won’t buy anything extra.
Although cash is a great way to budget mediocre purchases, the best way is probably a separate online bank account. My suggestion for this field would undoubtedly be Yotta savings. Yotta is a savings account that works entirely off a lottery system for interest. Prizes are awarded for winning tickets from the range of fifteen cents to ten million. Yotta is FDA certified so all money put in is therefore insured and can’t be lost. You get one ticket per week per twenty-five dollars you deposit, but if you sign up here and use code GETYOURGREENZ you can receive a free one-hundred tickets, and have a greater chance at the grand prize of ten million dollars. Currently you can’t buy things through the app, but you can save it up and pull it out once you have the money. Doing so requires a bit of self-control but remember to not spend a dime more than what you saved up. I have had multiple family members try this app for a month, and we’ve all had extremely high interests for one-month in. My mother has had a 1.47% return in just one month, which would end up a 17.64% return per year. I doubt Yotta can keep these impossibly high interest rates up, but for short term money that you were going to spend any way you get a great return.
Now that you know what to use to save up for a product, the most difficult part of the daunting task is upon you. Saving seems like it should be incredibly easy, but, it can be challenging for some and for others nearly impossible. When saving up for these average purchases, the first step is to decide how much you are going to save. If you can only afford to save five dollars per week, only save five dollars a week. If you can afford to save two-hundred dollars a week, only save two-hundred dollars a week. Pick a number that you know you can afford and every time you get your paycheck pay your bills and then save the amount you’ve chosen. Don’t ever spend before you save. Practices like this can also help justify unneeded purchases because now you’ve worked for it over a long period of time instead of blowing all your money instantly. Results of this form of saving will make you feel more grateful for what you have and cause you to realize what things you really want and what you really don’t.