In my planner (yes, with my love of technology, I still keep a paper planner), I keep a list of things I want to buy or at least spend a chunk of money on. I’m not specifically saving for any of these things, just slowly socking away money that I can spend when I’m ready.
A sampling of the list:
- iPad Mini
- professional bike fit
- new mattress
- upright freezer
- basement flooring
- guest bedroom furniture
- new washer and dryer
At this point, none of those qualify as all-out needs, though as time goes on, I think the new mattress is getting closer and closer to a need.
Right now, the iPad is just a want, because I don’t need it for work. It would be nice for blogging, but it’s definitely not something I can’t live without. Sadly, it’s probably the lowest ranked thing on this list and quite unlikely to happen.
As I spend more and more time on my bike, I find myself wanting a new bike fit more and more. I have had it fit before, but I want to go into a local pro who is known for taking his time and making teensy tiny tweaks to make riding even more amazing. So for the sake of my body, I’d say this ranks right under a new mattress. It’s probably also the cheapest thing on the list, so it’s possible this will be the first thing to get crossed off. Also, I already know where I’m going and how much it will cost, so the research is done.
My washer and dryer are bottom of the line (came with the house), and I’m fairly convinced they will break any day. I’d like to replace them before I get to that point, but at the same time, I don’t want to spend the money. This summer, I plan to start watching sales and see what I can find. It’s not a need yet, but it’s a bit more than a want. And I’d like to not have to pull from the emergency fund when it’s time to replace.
The most expensive and least likely to happen is the basement flooring. My entire basement is carpeted in very low-end carpet. It’s also white. Well, it was white at one point, anyway. It’s showing incredible wear, and I definitely want to replace it all with some sort of non-carpet alternative, but not only will that be expensive, it will be really annoying to clear out everything from the entire floor (my basement is used as living space), so I’m probably going to hold off on this one as long as I can.
I like keeping a list of things I want to buy. I find that it really helps my spending. A few months back, I had Christmas and birthday money burning a hole in my pocket. I could buy that iPad that I was lusting after. I considered walking into the store and picking it up.
Then I looked at my list. I’m a firm believer that gift money shouldn’t just be used for necessities. At least some of it should be spent on something you want to spend it on, not just on something you need. But there are a lot of things on this list that fall somewhere between wants and needs. So I decided to put the money away for later spending. While a bike fit sounds really boring, it will make me really happy. So will a new mattress. I do love sleep.
So that’s one way that I try to balance my spending. Preparing for the needs, carefully considering the wants, and prioritizing the in-between purchases.
Megan is a 40-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.