Avoiding Debts and Managing Purchases

So it’s the middle of your pay period and you drop by your favorite boutique or your favorite department store and they have the best pair of shoes you have been eying being put on a discounted price of up to 70% off the original cost but only for a limited time. When you make the calculations you won’t make it until payday. You do not have the money to buy it now but in a week’s time, you will. What happens next is you either swipe your credit card and make the purchase anyway or opt to get a payday loan.

Impulsive purchases individually are not as bad as most people think they are. It is when they come in huge numbers that they become fatal to your budgeting and finance. You may start with swiping one card and then the next, and when the debt gets too much you tend to cover it up with a payday loan or use another type of loan to cover up another loan. The practice may appear like you are covering your financial mistakes but the bigger picture is you are actually burying yourself in debt.

It always starts with one item on sale and it goes to the next  and before you know it you have already maxed out your credit card. The movie Confessions of a Shopaholic did tackle financial wellness for women and confronted it with the biggest threat: Fashion sale. For men the items are much more expensive such as gadgets and cars. When the desire to make impulsive purchases is not managed well it can result to serious financial losses with serious repercussions.

A sale is not an emergency. Always allot cash for emergency situations because this will ensure your financial wellness even after you are faced with situations of dire need such as hospitalization or if in the event that you have issues with your salary that may take another pay period to resolve. Another important thing to remember is that the emergency fund is for emergencies only and an item on sale is definitely not an emergency.

The things that you want regardless of whether or not they are on sale can wait. The things that you need cannot. You can always allocate money for the things that you want and wait for the right time to have these items on sale. Only use that money allocated for your wants for these type of purchases. Do not become a slave to these purchases but make sure that you are the one in control of the things that your money gets spent on.

Managing your purchases is a very basic task but as the amount of money grows and your purchase power increases it becomes more difficult to control it because then you will have the capacity to by more things and more factors can cause your budgeting to go on disarray. Always remember that the small purchases that you make every day can have a huge impact on how your weekly budget will be and what your annual expenses will look like. 

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