Most of the time, when people want to save more and spend less, they try to reduce or eliminate their extra spending. And this is a really important part of living below your means, saving money, and reaching your financial goals. But sometimes, just delaying your spending is enough to make an important difference.
However, delaying your spending can also be a bad idea. In fact, sometimes it’s a really, really bad idea. If you have a medical issue, or if your car or home needs a repair, waiting can be a huge mistake. Your problem can escalate from a small, manageable issue into a large, expensive one. Plus those issues can multiply and affect your income (missing work due to an unreliable car or an illness) and now putting that spending off will cost you big time.
But if you’re thinking of spending on a purchase, whether it’s something big (like a home or a car), medium (like a laptop or smartphone) or even something small, there are several useful reasons to delay your spending.
Spend time deciding if it’s a need or a want
Thanks in part to our culture full of advertising messages and Joneses to keep up with, we tend to want what we see. But how often do we need it? The first step is to determine whether it’s a need or a want. Having a mobile phone may be a need (for business and personal reasons as well as emergencies), but having the latest, great smartphone is a want. Now it’s perfectly alright to have wants. If you have money in your budget for some wants, and hopefully you do, then it’s a matter of narrowing down your wants to the ones that are truly important. What’s important for one person will be frivolous for another, and what seems to be important today might be not-so-important a week, a month, or a year from now. So it’s a good practice to keep a list of items on your want list and spend time considering if you really, truly want it, if it’s important to you, and if you will still want it as time passes. Sometimes the things on your list become unimportant within a month or two and you will know you’ve made a wise decision to wait.
Slow your upgrade cycle and save overall
When we save money, we are generally not saving it forever, but instead we are slowing our spending rate, whether it’s weekly, monthly, or yearly. One way to slow down our spending rate is buy quality items that last longer. However let’s face it, most of the time we want to update our purchases not because they are no longer usable, but because the current models are bigger, newer, better, and have shiny new features or styles. Think of cars, televisions, smartphones, fashion clothing, and the like. If you keep your smartphones for 4 years before upgrading instead of 2 years, that’s like saving 50% on the cost of your smartphone. Exercising a little self-control to delay your gratification can save you in the long run.
Use the extra time to find best deal
Many times when we find an item we want, it is marketed to us. Advertising, in-store marketing, even reviews, can be designed to make us buy, and buy right now. But the first place you see it may not be the best bargain. Take your time to read reviews of various models, compare prices and policies (returns, shipping, warranties, etc.), look for sales, and find coupons and promo codes. When we purchased our television some years back (yes, we have just one television, and it’s plenty), we took our time to find the model we wanted, then did some serious bargain hunting to find the best prices and delivery options. We got a local store to price-match an online offer and saved something like $75. Multiply those savings across all your purchases and soon you’re saving some serious dough.
Save up money for the purchase
Perhaps the most important reason to delay your spending (but the least followed), is to save up money for your purchase. Credit cards and financing deals have put most purchases in easy, immediate reach but that doesn’t mean we should abuse them. If you don’t have the money in the bank to cover those expenses, then you’re not ready to be buying. Find some room in your budget to save for what you want, and depending on your goal, set aside this money in an envelope or a savings account earmarked for that purpose. You may just find by the time you’ve saved up for your purchase, you no longer want to spend the money, but even if you do, at least you’re not going into debt and making interest payments on it.
They say patience is a virtue, and a little patience can help you focus on what’s important and keep your spending on track. Next time you’re tempted to whip out that credit card, pause and consider whether a delay will help you and your finances.
Have you ever put off a purchase? Did the delay help you save money?
Image courtesy of Stuart Miles at freedigitalphotos.net (with changes)