Saving on Your Purchases
Nearly every family in the world wants to be wise purchasers, but few are able to achieve
that goal. Instead, we look around our homes and take inventory of items that we paid too much for, things we purchased
that we didn't really need, and broken or non-functioning items that we may have "saved" on when purchasing
but which are now costing us money in repairs or upkeep. In addition, our accumulation of "things" not
only eats into our family budgets, it often clutters our lives with junk we eventually realize that we really didn't
Distinguish between Wants and Needs: You will save a ton of money if you don't mistake wants for needs.
Needs are pretty simple to identify--those items that are necessary to sustain the family: Shelter, food, clothing,
transportation. Wants are those things that enhance or possibly improve our family life. A car is a need. A $50,000
Sport Utility Vehicle is a want, even if a lot of people don't see it that way. Have you ever heard (or said) "I
absolutely need...?" when the actual meaning was "I really want?" This is not
to suggest that you shouldn't be able to have the things you want--only that to delude yourself into believing
that a want is a need--and busting your budget in the process--is a recipe for financial disaster.
Take advantage of group purchasing power: There are a number of ways to accomplish this. Credit Unions, for
example, will often have group purchasing agreements on certain items. Warehouse clubs are also a good source.
Although you often have to buy in slightly larger quantities, they will often save you money on many everyday items.
If you aren't a member of one, visit one of the clubs, get a "guest pass" and see if joining would be
a money saver.
Is less better? Perhaps it was due to the late, great booming economy, perhaps "keeping up with the
Jonesism", maybe its ego, but for many of us, we often seem to insist on the biggest and the best, no matter
what the cost. When a $15,000 new car may be more than acceptable, we stretch the seams of our budget to afford
a $25,000 vehicle. We buy $25 shirts with $35 designer labels attached. We opt for the $100 dinner at the trendy
restaurant when a $20 meal would have been just as delicious. Think about where you are spending the family money--and
how--to see if there couldn't be savings found with minor changes in habits.
Try before you Buy: This goes a long way in helping to avoid the silly purchases of things you rarely or never
use. Before you buy something, especially items with big price tags, borrow one, rent one or try one out before
you plunk down the cash. If you are bored with it, or determine that it truly is not something you need before
you buy it (and you will be on a certain percentage of items) you will definitely be bored with it, or find it
not that necessary, after!
Take this example: You feel that you absolutely must have a new Jet-Ski, at a cost of $4500 (and
that is before financing and taxes). You go to the lake, rent one, and 45 minutes into a one hour rental you are
saying, "geez, this is a long hour." Saved: More than $4500 (a year of college fees for the kid!)
Don't be surprised when (not if) extravagant purchases
lose their glitter. Houses, cars and many fancy
purchases tend to lose much of their appeal eventually. After the "oohs" and "aahs" of family
and friends fade, the big payments, maintenance and repairs continue (and the oohers and aahers normally won't
be helping you with the payments!) The mantra you need to remember is: Do we really need this or do we just
it? And, if it is a want, can we really afford it without harming either our short term goals, our long term goals,
For more information, see Saving money on
the things you buy.
Want a helpful plan? In The
Average Family's Guide to Financial Freedom, BIll and Mary Toohey tell the story of how they got their financial picture in
line and increased their net worth to nearly $500,000. The plan takes a little work and some sacrifice, but the
rewards are, for most families, worth the price.
Want more tips on saving on the things you buy? Check out the Tightwad Gazette III : Promoting Thrift As a Viable Alternative Lifestyle by Amy Dacyczyn. It is a complete
guide to cutting back on the money you spend on all of your purchases.