“Too many people spend money they haven’t earned, to buy things they don’t want, to impress people they don’t like.” —Will Rogers
The average American home size has doubled in the past 50 years. Still 10% of households rent offsite storage and 25% of homeowners with two-car garages can’t park cars in them. 76% of Americans live paycheck-to-paycheck. And the average US household credit card debt stands at $15,191.
It appears we have a spending problem. We buy far more than we need.
And yet, our filled closets, overflowing drawers, and crammed basements stand as proof that purchases are not improving our lives. Our discontent is evidenced in our excess. (tweet that)
In every imaginable category (from homes and cars to clothing and technology), we must find greater intentionality in our consumer pursuits.
To accomplish this, I propose we start asking ourselves some very specific questions before making any purchase.
3 Questions to Ask Before Any Purchase (by category)
Clothing/Apparel:
1. Am I replacing an item of clothing or buying something new? If the item is not a specific replacement, rethink your need for it.
2. Is this something I will wear regularly? If you can’t see yourself wearing the item on a regular basis, rethink the purchase.
3. Is the style one that will last? Don’t believe all the hype of the latest trends, they are manufactured by the fashion industry and change quickly.
Technology:
1. What problem does this solve? Technology should make our lives easier by solving problems. If a new technology is not solving an existing problem, it is only adding to them.
2. Are there any rumors of new advancements to this technology? Technology is changing rapidly. If your purchase is not time sensitive, it may be wise to double-check if a new release is right around the corner.
3. Is this technology I can afford? Keep in mind the full cost is often far greater than the initial investment.
Furniture/Decor:
1. Is my purchase based on a genuine need or a cultural pressure? Am I succumbing to a specific pressure brought on by cultural, peer, or family pressure? Or is the furniture/decor something I truly need?
2. Am I choosing quality over quantity? With furniture, choose quality over quantity. One comfortable place to sit is far better than three uncomfortable options. And one beautiful piece of art decor will provide more life than a dozen cheap ones.
3. Is this style one that will last?
Entertainment:
1. Will this entertainment choice result in rest and value? Entertainment moves our emotion, occupies our heart, and exercises our mind. Or at least, it should. Choose to invest your entertainment dollars in places that will.
2. Am I overusing entertainment to escape my life? There is nothing wrong with enjoying entertainment. It serves an important purpose. However, it can become a personal and financial burden if we use it as a means to routinely escape our own reality rather than face it.
3. Is there a cheaper alternative? A walk in the park or a hike up a mountain is often more entertaining and beneficial than buying another movie ticket.
Food:
1. Will this food add fuel to my life? Unhealthy foods may taste better in the moment, but in the long-run, they detract from our well-being and lifestyle.
2. Are my food decisions contributing to my financial stress? According to statistics, Americans spend 42% of their total food bill eating out. If you are unable to get ahead financially, this is one easy place to start cutting back.
3. Who am I supporting with this purchase? You need to eat. Support your local economy while you do.
Personal Insurance/Health:
1. If purchased personally, have I discussed my options with a health insurance professional? Find professional help with this decision. It is their job to understand all your options (and they are changing quickly).
2. Have I researched the benefits of my existing plan? Am I getting the absolute most out of my current payments? Search dental, vision, and preventive care.
3. Am I pursuing a health-benefiting lifestyle? The most effective way to keep your health care costs at a minimum is to pursue a healthy lifestyle. Accidents and heritage happen, but healthy habits always pay for themselves in the long run.
Transportation:
1. Do I need a new vehicle? If not, why do I want a new vehicle? And is that a good enough reason to spend the resources?
2. How much cash + trade-in have I saved? Always, always buy your vehicles with cash. You won’t regret it.
3. What are the additional expenses associated with this purchase? Calculate insurance, gasoline, anticipated maintenance, and unique circumstances (parking, tolls). Factor these into your decision by comparing several models. Sometimes a vehicle may cost more upfront, but save money in the long run.
Housing:
1. Am I buying/renting only what I need? Choose shelter based on your needs, not what the realtor says you can afford.
2. What will be the additional expenses included in this purchase? Whenever possible, research the utility costs, insurance, taxes, expected maintenance, and HOA fees of your new purchase—especially if you are transitioning from a rental.
3. Will this arrangement bring freedom or burden into my life? Your home should bring you security and stability—not stress. Wisely consider also the impact of potential economic downturns on your home value and ability to make future payments.
Pets:
1. Is this a pet I can afford? Consider all costs associated with your pet: feeding, licensing, housing, cleaning, grooming, pet-sitters, and medical expenses.
2. “Will this animal or pet keep me from pursuing other important goals like travel, hosting others in my home, or financial independence?”
3. Will the benefits an animal brings to my life outweigh the extra work and expenses? Am I able to articulate the exact reason why I am taking on this responsibility?
I am very open to this being a fluid list. Are there any spending categories you would like me to add? Or do you have any specific questions for the categories above you have found particularly helpful? Let us know in the comment section below.
Gladys (The Pinay Mom) says
I used to be an impulsive buyer and I read somewhere about buying wants and you want to buy it now. They say it’s a sign of immaturity. And we all should know the difference between wants and needs.
Gwendolyn Campbell says
My grandmother – who grew into young adulthood during the Great Depression – had two questions for all purchases:
1) Do I really need it? (Not just want it.)
2) Can I afford it (now, in cash, without jeopardizing any other financial needs or goals)?
She only made the purchase if BOTH answers were “Yes.”
When I think about what she and my grandfather had when they started their life together and what they accomplished and built together during their lifetimes, I am in awe. I miss her so much…
Alex says
Good stuff. I’d like to see a “share” button to share this article in my facebook and tweeter profile
Sue says
I wonder if any of your readers have tips on travel/vacations? We don’t go away from home very often (except to see family members). Although in the past we have been out of the UK maybe 10 times in 30 years, this has got less frequent now. However, we seem to be surrounded by people who are travelling the world, going further and more often and for longer than we ever have. These same people always imply that we “should” be doing the same, but I’m not so sure.
Part of me would like to see certain places in the world, but I’m quite an anxious person and not good at strange situations (or languages). In many ways I’m content to be at home, and there are certainly many places in the UK that we haven’t seen yet and would like to. I also worry about the environmental implications of flying or driving long distances, and about the negative impact of tourism on some places. And I absolutely hate finding an English pub serving fish and chips and showing English football, in a Greek village!
It’s quite difficult to make decisions about holidays based on this set of criteria. More and more we don’t make a decision, we just stay at home.
Jess says
I live in the states, but maybe this applies over there as well. While I would love to travel the world, I find many things to do withing a few hours drive of my home. We have many wonderful state and national parks. We do a lot of camping, hiking, and fishing with the family. We also have many museums and attractions near where we live. I think a lot of times, people overlook wonderful opportunities near home in favor of the exotic trip. You can be well traveled and never leave your home country.
Eve says
My husband and I have an annual tradition of leaving the kids with their grandmother and going someplace within driving distance for our anniversary. Nothing fancy, we stay in the cheapest clean hotel we can find and try to find the non-tourist spots that make a place unique, like eating in a Greek bakery in Tarpon Springs, a town here founded by Greek immigrants and visiting the Greek Orthodox church (they are beautiful, very highly decorated). If we buy any sort of keepsake, it is usually something inexpensive that I already have a place for and will be functional in our home. Nearly every place has something unique about it, whether it is an old church or some odd bit of history, so you don’t have to go to foreign countries or places with large crowds. But it is great to get a change of scenery once in awhile and feel like you’re on an adventure with your sweetie, exploring something new.
Maile says
My husband and I have a soft spot for strays and have taken in many. This is not a choice I would recommend for just anyone – we both have worked with animals in a professional capacity, and have trained and rehabilitated many animals, especially difficult breed dogs. One of the reasons we end up taking in so many is that they are often purchased by owners who like the idea of a breed more than they like the reality. For example, movies such as 101 Dalmatians, Men in Black (Pug), Beethoven (St. Bernard) massively increased the popularity and interest in certain breeds. While wonderful dogs, all of them have specific behavioral and/or health concerns that uneducated owners may not understand or be equipped to deal with, resulting in many dogs being neglected or even abandoned. I cannot stress enough the importance of researching the breed, including temperament (especially when children or other pets are in the house), size, health, and exercise requirements BEFORE giving into the idea of a dog or a demand from a child for a cute creature they saw on TV. Dogs are some of the most wonderful friends and family members, but they are living things and need to be cared for and loved as such, not collected because they are cute and then abandoned when they get too big, too rambunctious, or develop health issues.
susie says
Minimalist!?!? Their 3 questions expanded from 3 to about 30….
I can do better, thanks but no thanks for the lame advice
Christine says
Susie, this is not nicely put, but I agree that the decision making questions seem to make the whole process more complex than simple.
Jaime says
I see your points about wanting to minimize in all aspects, but I’m glad to see that this post opts for richness rather than oversimplification. The movement toward minimalism, at least for me, includes quite a bit of internal questioning and conversation–more thought helps get to less stuff.
anet says
“lame advice”?? ouch!! — Thank you Susie for this opportunity to practice working on my shenpa! ; )
but I LOVE this list–I actually made a copy of this and got it by my computer (I tunes and Amazon and Etsy– take notice!) ..because the over simplified lists just don’t serve me, I’m not so clear cut. I think its safe to say– that for many of us decisions often ride on a lot more nuances and caveats than can be expressed in ‘simple’ rules.
Jim L. says
Great post, Joshua,
Transportation costs is a great area to consider before purchasing a vehicle.
I would add a category for sports/fitness to the list. Committing to a free walking routine takes just as much will power as committing to using an expensive gym membership and has just as many health benefits, if not more. Also, when considering whether you or a family member commits to participating in a sport, carefully look at all the costs for equipment and any travel involved. The expenses for participating in a travel team can add up quickly.
Again, thanks for a great post.
Andrew says
Great post! It’s amazing how principles so simple go such a long way.
Arthur in the Garden! says
Great tips!
Lea says
There was a time when I would buy something I “thought” I wanted while shopping. It was impulse buying. Then get home and realize for whatever reason I didn’t want it. So I started making myself not buy impulsively while in in the store. If I really wanted it, the item would stay on my mind and I could always go back. If it was a decorative object, while in the store I would think about how it fit in with the rest of the things. Where it would go and would it look cluttered. I like clean, open space around me. In time I also started thinking about how much time it would take to clean, how it had to be cleaned, and/or if it had to be cleaned professionally. If professionals had to clean it how often and what cost. I’m at the point now where I don’t want to spend time cleaning dust collectors but would rather spend time doing what I enjoy.
As for pets I am a big animal lover. Until 1 1/2 years ago I’ve always had a dog(s) and/or cat(s) and will have a dog(s) again. For now it doesn’t work for us, unfortunately. One of our last dogs had many medical problems from the get go (starting at 4 months old) and we happily paid what we had to for her to be healthy & happy. It was expensive, she was worth it. Another consideration is the cost of training (very important), treats, toys and medical care. Training a dog is fun for both dog and owner with the right trainer. To avoid destructive behavior training along with plenty of daily exercise makes all the difference. So time should be considered. To me having a pet is most certainly worth skipping a vacation for and I would bring them along if possible. I walk daily and love walking with dogs (I walk with my neighbor’s dogs every day.) When the time comes for us to get another dog(s) we will adopt older ones from a rescue. Because they are older they are more often overlooked. Some people don’t want to become emotionally attached to a dog with only a couple years or less time left. And of course the medical expenses that come with an older dog don’t fair well for the older ones. I understand that. But to me I get back way more than I give them.