The road to financial freedom has no easy path and for most who aim for success we can ourselves stuck in the middle of the journey and often not knowing the next step to take. To spend or save, buy or not to buy is often going to be your dilemma when we find ourselves in our daily lives. We want to save more and stick to the planned budget but do you consider and account for the long term results of saving over spending? What happens later if you dont spend that money now?
Should you spend or save more personally?
When it comes to your needs, you have to think of a better way to manage your budget with regards to your daily expenses. You may not notice it consciously but how you handle your money in a day-to-day basis will pretty much tell you whether you will reach your budget or go beyond it. Now some would tell you to spend your money to buy enough stuff that will last you for some time while others would tell you that you have to save as much as possible and only buy when you need to or if your supplies run out.
To better visualize and weigh which would be a better option for you, let us check what you can gain or lose when you spend or save.
Buying food supplies.
When you purchase enough food to last for the week or by buying in bulk you can save with the pricing that you couldn’t manage with small shops for what you need day to day. Especially if you shop where they give discounts for bulk buying. Problem is you have to find storage for the food which means you have to spend more on your energy bill if it needs refrigeration. You can also lose more to spoilage.
Buying your food daily on the other hand also means you have to go out to buy it. This will result in time and money to get your groceries every day whether you have a car or not. You may save paying more on your next energy bill but end up spending extra to go out daily.
You may even eat more if you have more in the pantry than you would if you need to stretch out what you have to last longer.
Keeping yourself fit.
Investing for your health is one common choice people do or dont make depending on where they feel they are on their financial journey. And this one decision can get worse the longer it takes a back seat for other more “important” expenditures. Some would spend on gym memberships or maybe build their own home gyms. These helps to not only look great but also to keep our bodies fit and increase their immunity from common illnesses.
Now someone who is keen in saving as much as they could may find gym memberships a luxury. They would rather opt to put their money in their savings account rather than pay for fitness gears let alone spending more on eating more or better and face obesity, time off for sickness or even major health concerns later.
Avoiding the dentist to avoid the bill can simply mean instead of a yearly checkup you face major fillings in one hit. I know I went this way and ended up with eight fillings!
Home maintenance and upkeep.
Some individuals would never doubt hiring someone to maintain their properties. Or if the budget will not permit, they themselves would spend regularly to make sure that their homes are in good condition making it a part of their monthly expenses. On an average, it can cost £9,590 annually to maintain a home in UK and that would include utility bills, repair costs and building maintenance.
Others on the other hand would say that it is a big chunk of money from their monthly budget. Why spend in advance if you can just pay when repairs become necessary? What could we be doing with the money instead? This one is a complete and utter gamble but one thing is for sure some home maintenance needs to be done in order to avoid larger future bills. Keeping gutters clean and trees away from the house can save on costly roof repairs and slab damage.
What we can actually see with all these scenarios is that when you talk about spending or saving more, it comes down to the unique situations a person has or on his or her priorities short,medium and long term. If you can save in one area and achieve significant returns on an investment that are greater than potential long term costs then this can be a calculated risk. What is important is that you weigh things over, know your needs, goals, your limitations and the available resources you have at your disposal. Once you determine those factors then you your decisions form there whether should you spend or save more personally.
***Photo thanks to 401(k)2012***