This article is part of a 30-day series called the 30 Steps Program to Financial Independence.
MINIMIZE YOUR WANTS
If your goal is to achieve financial independence quickly, saving as much money as possible is essential. While small savings like packing your lunch or biking to work help, they can be easily undone by significant purchases.
Before you spend big on things like a designer purse or a pricey vacation, ask yourself a few questions:
– Do you really want this item or trip?
– Can you find a cheaper alternative?
– How much will it set you back financially, and how will it affect your savings goals?
– Is it worth proceeding despite the financial impact?
It’s not about never going out or spending money but about prioritizing and distinguishing between needs and wants.
For example:
– I need a place to live but wanting extra amenities like a guestroom or garden might not be feasible on a tight budget. Opting for a smaller home or sharing expenses with roommates might be a better choice.
– I need food but don’t always need to order the most extravagant meals. Often, a main course is enough to satisfy me without always opting for dessert.
By identifying what’s essential and what’s a luxury, you can avoid unnecessary expenses. Cutting these can speed up your journey toward financial independence, and you won’t miss not having those extras.
If you simplify your wants, you can save more without feeling deprived. For instance, skip the daily coffee shop stop. Make coffee at home and bring it with you. Invite friends over for meals instead of going out every night. While it’s okay to spend occasionally, doing it regularly can become costly and less enjoyable.
Personally, my wants are minimal. I prefer gatherings at home over noisy bars and enjoy outdoor activities that don’t cost much. Cooking at home is another way I save since restaurant prices can be steep compared to homemade meals.
I still have nice things, like a laptop and an iPod touch, but I bought them out of necessity for my work and communication needs, not to show off. I chose practical, not extravagant, versions and plan to keep them until they no longer function. This approach saves money, time, and energy, bringing me closer to financial independence.