Simple ways to live below your means

 Posted by Clyde Gonsalvez on August 28, 2021

Do you find it hard to live below your means?

If you are like most people then the answer is yes! A lot of us struggle to live below our means. Credit card debt and personal loans are perfect examples of this. I meet a lot of people who have an outstanding credit card debt that they are struggling to repay.

If you want to create wealth long term you have to live below your means. Otherwise, you will fall into a debt cycle that you will struggle to come out from.

Here are 3 simple ways to live below your means

Know the difference between a need and a want.

When I do a budget session with clients this is something we put a lot of time and focus on. We go through their everyday expenses and discuss their needs vs wants. A lot of people confuse wants with needs and as a result are not able to budget. The goal here is to focus on the needs not the wants. Remember a need is something that is essential for your wellbeing. A need is food, accommodation, bills, medicine etc. Wants are desires such as eating out, new clothing, car stereo etc. I am not saying not to buy wants. I am saying don’t confuse a want with a need.

Stop comparing yourself with the Jones.

This is something a lot of people struggle with – comparing oneself with others. When we see our friends or family buy the latest “thing” we have to go out and buy it as well. If a friend buys a new car, we think that our car needs an upgrade and we go out and buy a new car. This attitude will never help us to live below our means. One of the best ways to stop comparing yourself with others is to be grateful with what you have. If you focus on having an attitude of gratitude you will stop comparing yourself with others period!

Learn to cook

How much do you spend eating out? If you look back at your last 3 months bank transactions you will be amazed at how much you spend eating out. I have never met anyone who underspends on this category! If you want to live below your means then learn to cook. Imagine how much money you potentially can save if you learn to cook? Don’t know where to start? These days there are so many ways to develop this skill. Just go online. Don’t make the excuse you don’t have time. Everyone has the same amount of time in a day. It’s what you prioritise within the time you have that matters.  

Whether you're a first home buyer, first time investor or need help with your budgeting and financial planning - we can help.

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