Hey, friends! Today we have a guest post from fellow blogger Mrs. Raggedly Rich. Enjoy!
One of the best ways to manage expenses proactively instead of reactively is to plan ahead.
Doing this is second nature to me. And it always comes in handy. Whether it’s travelling from one city to my hometown at the end of a contract, or backpacking across Europe for a month, my default is to plan ahead.
When you diligently research routes, hunt for tips & tricks, and spend hours processing the information, it can only do you good in the long run. There is a balance you need to achieve when you go the researching route – everyone’s different.
So what do you do if planning ahead isn’t second nature? Don’t panic! It isn’t easy for everyone, and the thing that I think prevents most people from even attempting it is the mindset: but what if something changes?! If something changes, then you just adapt to the situation, and hope that your research will come in handy. Even if absolutely everything goes wrong, trust me when I say that all that planning won’t be for null.
So, what do you need to be able to proactively manage your expenses?
Self-control is the hard part. Self-control lives in the realm of discipline, but is slightly different because self-control is a tool you use to increase your discipline. Someone with no self-control is going to struggle to stay disciplined and sticking to a financial plan, or any sort of long-term goal.
And if your self-control is lacking, don’t put too much pressure on yourself. Acknowledge that you maybe don’t have the best impulse control, and start small. Stick a snack in your car / backpack / purse so that you can avoid unplanned drive-thru stops.
The first couple times when you’re hungry, you might not reach for it, but one day it’ll be there when you need it. And that’s how you ease yourself into the mindset and habit of exercising self-control.
Honesty with Yourself
Are you someone who can inexplicably inhale 3-4 Haggen-Daz Almond-Chocolate bars in one night? I am. As such, I’ve learned to never buy Haggen-Daz bars. I know that I’m completely powerless when tempted with a deliciously crisp yet delicate almond coated chocolate outer layer. So, I remove the temptation.
Be honest with what you can handle, and what you can’t. If you can’t handle credit cards and always spend beyond your means, cut the plastic and stick to cash. There’s nothing embarrassing or weak about admitting your weaknesses, and I don’t think you should listen to anyone who wants to convince you otherwise.
The only way you’re going to be able to set yourself up for success is if you understand what you can and cannot do. Only good can come from knowing yourself.
3. Know the Value of Things
This sort-of falls into the realm of honesty, but leans towards the factual. This is stuff like undervaluing the benefits of a good oil change, and overvaluing the benefits of fancy racing tire rims. You can destroy a car in 60,000 km if you never pay it any maintenance – whereas my sturdy beast is going to tick over to 380,000 km soon, and it still drives like a dream.
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Oil change? Yes. Good tire rims, sure, but the super fancy expensive ones? They might make your car look snazzier, but they’ll probably serve you just as well as the off-brand ones that look a little clunky. Do your research, and know what’s worth it and what’s not.
And then be honest with yourself, and realize what’s worth it to you. There are some things that are worth spending money on, and something things that mean more than the money you spend on them. But only you are going to know which are which.
Related: How We Broke the New and Shiny Cycle
Everyone’s different, and it’s okay to have priorities that don’t line up with anyone else’s.
So what things can you apply those to, in order to help with your expenses? 3 things immediately pop into mind:
- Preventative care
Cost of Food
Plan ahead, have a back-up, and don’t expect yourself to be perfect. I know roughly how much I’m going to need to eat in a day, and how that amount rises when there’s physically demanding effort involved.
Always pack a little extra, and if you can, keep something around that’ll last a while (I started sticking nuts in my car when I realized I was eating handfuls and handfuls of junk each time I got into my CandyMobile (aka my First Car) – now I keep one of those tiny ziploc containers at work as a tide-me-over, and take it home to refill as needed).
Planning ahead and having a back-up sometimes isn’t easy. Sometimes, it’s the absolute last thing you want to be doing after a long day. In these instances, think of where you’ll be tomorrow.
Are you going to take the extra twenty minutes today and set yourself up for success? Or are you really going to be able to get up earlier in the morning to make lunch? Don’t fall into the trap of using future-you as an excuse to avoid doing the work now.
We all falter and make mistakes – the trick is not being too hard on yourself when it happens, but also being hard enough to realize when you’ve being intentionally negligent. Sometimes life genuinely throws you a curve ball, and sometimes it was just a bad call.
Cost of Transportation
Last-minute travel usually comes with a hefty price tag. I find this more applicable for long-distance travel than local, but it still applies to things like taxis and ubers. Forgot to check the bus schedule on the stat holiday and realize while you’re waiting at the stop that service doesn’t start for another hour?
Sometimes these costs are unavoidable, but most times, shopping around, researching routes and options, and purchasing in advance can save you hundreds of dollars.
When I visited the Southern States, I purchased a flight to the state’s international airport and opted for taking the state bus instead of flying to the local airport – the extra leg of the flight would’ve cost me at least $250+, and added a 5-7 hour layover. A $3 round-trip for the local bus gets me to the pickup location for the $15 round-trip on the state bus.
At a 3-4 hour trip, the layover negates any time saved. Travel hacking is a thing, if you’re willing to put in the time and research to make your buck stretch.
Cost of Preventative Care
My Dad has instilled in me the value of proper mechanical-meltdown-prevention – and it stems to other facets of life as well. Would you rather spend a couple bucks here and there now, or pay a hefty lump sum later on in a year or two?
Preventative care ranges from dental work, health, home and car maintenance, to dishing out the extra for a fancier TV, if that’s what you can afford and what you’ll be happy with. Invest in now so that you don’t have to fret about the future.
But also know that sometimes ‘good-enough’ is the better option (if it only needs to last for three-weeks, why spend x to make it last forever?). There are times where preventative care is not worth it. Our family has a car that’s as old as I am.
Suffice to say, there are certain cosmetic actions we could take that would certainly prolong the life of Mr. Rusty Truck – but those actions are simply not worth it because we don’t plan on keeping it for the next 5-10 years.
But the most important thing, is being honest with yourself, and know what you’re content to keep raggedly, and what you need to be a little fancier. Knowing what you want and what matters to you will help you understand which issues you need to tackle proactively, and which you can let bake in the sun until they get carted off to the junk yard.
How do you manage your expenses proactively?