One of the biggest mistakes people make is to live above their means. This is when you spend more than you’re bringing in. This can lead to massive debt and an unhealthy relationship with money.
Thankfully, it doesn’t have to be this way. There are ways to live below your means (so you can save money or pay off debt) without feeling deprived.
Cut Unnecessary Expenses
First things first. Go through your bank statements and see what you’re wasting money on. It might be a gym membership or streaming service you never use. It might even be something you signed up to get a free month of and never remembered to cancel.
Stop letting this money go to waste. There are so many things you’re paying for that you don’t actually use.
Create a Realistic Budget
A good budget will help you stay within your means. The key is to create a realistic budget. The best way to do this is to track your expenses for at least two months to see where you spend your money. This will also help you see what you may be wasting money on.
Once you have a realistic budget, use the envelope system to help you stick to it.
Rather than feeling restricting, a realistic budget will give you the freedom to spend on items you have budgeted for. No need to feel guilty about a purchase as long as it's included in your budget!
Give Yourself Spending Money
People often make the mistake of not giving themselves any extra money to spend when they’re trying to do better financially. This never works.
When you work hard for your money, and never use any of it on yourself, you will feel deprived. Even if you just get $20 a week to spend however you want, it can make a big difference.
Find New Ways to Do Things
There are different ways to do the same things. For example, let’s say you love watching movies. Instead of hitting up Redbox every week, why not pay for Netflix, Hulu, or Amazon Prime? You could get both services for less than $20 a month. Why rent less than 15 movies each month when you could watch unlimited movies?
Look at the things you love to do and then find ways to do them for less.
If you're looking for activities to do, look for free alternatives. Rather than going out for dinner, how about a picnic at a park? You could go on a walk or bike ride for fun. Just adjust your expectations that you need to spend money to have fun!
Make Free Your New Favorite Word
Last, but not least, look at all the things you can get for free. Once you start looking, you’ll be amazed.
You don’t have to spend a lot of money to live the life you want. All you need to do is be smarter about how you spend your money.
Living within your means doesn’t mean feeling deprived. It simply means that you learn to make the most of your money.
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