Who doesn’t love money? The idea of being rich being your wildest dreams, buying plenty of flashy clothes and expensive gadgets, showing them off to your friends and going on holidays to the world’s most famous locations, like the ones listed at cntraveller.com, is something that we probably dream about on a regular basis. However, the reality is that only a small percentage of people in the world can indulge in such activities. Luckily, we can get a little slice of that heaven whenever we go on holiday, or whenever we save up enough money to buy a new fancy car or the latest electronics. Sadly, it doesn’t last long, but that doesn’t stop many people from living beyond their boundaries.
Unfortunately, most people don’t realize when they’re living a lifestyle that they can’t afford. They’re usually under the illusion that everything is fine, or they scrape by and can barely afford the necessities while splashing cash on luxuries. It’s fine because we all do it at some point in our lives. Perhaps we buy a luxurious coat and show it off to our friends for a while, or maybe we indulge a little too much in a hobby and buy some high-end equipment that barely fits through the front door. Pampering yourself is fine, but there are times when you need to cut down and realize that you’re living a lifestyle that is beyond your means.
- You fear missing out on products and items
If you feel like you constantly have to catch up with your friends and spend money on products, fashion and services just to keep up, then you’re probably living a little beyond your means. Whether it’s the latest video games console, the newest fashion trends or even just the latest music, you shouldn’t feel like you need to keep up with them. Develop your own style, love the products that you use, and don’t feel like you have to be hip by trying to fit in.
Your friends shouldn’t care if you are keeping up with them or not. Sure, sometimes it sucks if they’re conversing about the latest hot product on the market and you feel left out because you don’t have it, but don’t let that discourage you. As explained on dawn.com, you should never let money dictate your life because people should value you as a person, not the things you own. Stop trying to match their spending habits and instead, enjoy what you have and live life how you want to instead of using your friends as a means to dictate how much you should and shouldn’t spend on something.
- You spend money to keep impressions up
Most people will have a guest room and some entertainment for when friends and family visit. However, some people take this to new extremes and they have game rooms, multiple spare bedrooms, and large-scale entertainment devices that are specifically designed for their guests. If you have a lot of rooms and appliances in your house that don’t see regular use and they’re just there to entertain and impress people, then you’re probably spending far too much money on trying to stand out. Of course, if you can afford it then that’s not a problem, but most people won’t be able to sustain a large house and keep purchasing items just for the sake of keeping impressions up.
Don’t be afraid of living frugally. If anything, it means that you’re living within your limits and you aren’t using money on unnecessary expenses. You should even consider selling your house on a website such as StlRealEstatellc.com/we-buy-houses-st-louis/ to drastically cut down on useless space and paying utility bills that you can’t afford or could reduce. You don’t need a large home to impress. In fact, many people love the idea of compact homes that serve multiple functions. For instance, a living room could be converted into a dining room with fold-out tables that hide in the walls, or you could knock down walls to merge both the kitchen and dining area to create a sense of space. Sometimes, making use of what you have is better than throwing money at the problem if you want to make a good impression on your friends.
- You hide your purchases
Let’s face it, we all hide the things we buy now and then. Whether it’s an expensive video game, a new piece of jewelry or even just some expensive groceries, if you have to hide these from your friends and family, then you probably feel guilty about buying it. There are, of course, times when you could just be feeling guilty because you could’ve spent the money on something else and it’s not necessarily a sign that you’re living beyond your means. However, in almost every other case, you’re probably feeling guilty because instead of paying the bills, you’ve gone and bought some fancy shoes that you saw.
Keeping your expenses under control is the key to living within your means. Impulse purchases are a big no, and buying luxury items you don’t actually need should be avoided. Be proud of what you purchase and don’t feel like you have to hide it from others. If you feel like you need to lie about your spending habits, then consider cutting down on your expenses so that you don’t feel like you need to fake how much you spend.
- You’ve never tried to manage your finances
Surprisingly, one of the things that prevent us from managing our finances isn’t a lack of ability or no access to some software, it’s that we’re too ashamed to look at our spending. Our “small” purchases add up over time. A few small purchases here and there doesn’t seem like a lot, but at the end of the week, you’re probably spending more money than you think. This is why setting up a budget is important. The only way to actually take control of your spending is to monitor it. Use a budget app such as the ones listed at gottabemobile.com to record your income and then note down all of your expenses, and you’ll find that you have a lot less money to spend than you think.
Budgeting is one of the first steps people take on the road to recovery. Not only can you find ways to actually cut down on unnecessary expenses, you might find that you can continue buying expensive items as long as you shift your spending a bit. For instance, you could save a decent chunk of money by removing unneeded insurance policies or switching utility providers, thus giving you more disposable income to play with. Don’t feel ashamed because you’ve never set a budget. Make a change now and start budgeting so that you don’t end up in debt because of your uncontrolled spending.
- You always have an empty wallet on payday
If you find yourself living from paycheck to paycheck, planning all the things you want to buy for next month, then you’re likely spending a bit too much money and living a life you can’t afford. Most of these expenses are probably luxury things that you should really be saving money on, but if you find that you have very few funds after paying rent, utility bills and buying necessary items like groceries, then you might need to make some lifestyle changes in order to fit your income.
Budgeting can help you minimize the number of expenses you have, but in most cases, you’ll need to actively try to change your lifestyle in order to fit your income. Keep in mind that not having money a few days before payday isn’t necessarily a bad thing assuming you’re taking steps to actively save money. For instance, maybe you dump the rest of your disposable income into a savings account a few days before payday, or perhaps once you get your pay, you instantly put a large portion of it into a bank account to save for later. However, if you’re not actually saving money and most of your funds are going into actual expenses, then it might be time to scale down, move into a smaller home, or cut down your utility usage. You should always strive to have some income left over before payday and you should always save a bit of money in an emergency fund.
There are many signs that let you know you’re living a lifestyle you can’t afford. Most of it comes down to peer pressure and the need to fit in with your surroundings. However, if you’re usually in the company of wealthy friends and feel like they look down on you when you don’t meet their expectations, you might be hanging around the wrong crowd. We can all dream and live our fantasies of having a luxurious lifestyle, but until you actually start earning enough money to sustain it, you’ll need to burst that bubble and live a humble and frugal lifestyle that you can actually support. Remember to focus on necessary expenses such as bills and food, and always put your luxuries last. After all, the last thing you want is to end up with an expensive credit card bill and plunge into debt.