According to the Federal Reserve, the average US household debt is $20,000, not including mortgages. 52% of Americans are spending more than they earn and one in four Americans has more debt than savings. With statistics like these, it’s no wonder spending can cause feelings of guilt.
"If you’ve ever felt guilty about spending, you’re not alone", explains Gary Barnes, a successful entrepreneur, international speaker and business coach. "Good planning and a little strategy can empower you to move forward financially, and lose the guilt".
Here are five ways you can spend money, guilt-free.
· Know your income and expenses. Examine your income and expenditures to determine exactly how much money you have coming in and where you’re spending that money. This will help you determine how much you can spend on extras.
· Allocate and accumulate dollars for specific uses. Make sure you do your homework. Shop around, have a definite price in mind, and make a plan using a calendar with a date marked for the purchase.
· Create a spending plan. Your spending plan, or budget, shows you exactly where your money comes from and where it goes. It is the best way to get the big picture of your finances. Creating a spending plan will help you get a better sense on how you spend your money and how much things cost. With that comes an additional awareness of areas to cut back on or replace with lower-cost alternatives.
· Delayed gratification. In today’s “gotta-have-it-now,” world, learning to apply the concept of delayed gratification is not so simple, but it is crucial to achieving financial security. Few people can really afford to buy everything they want when they want it. We need to learn that some things are worth waiting for, especially if it means we can avoid going into debt.
· Don’t spend borrowed dollars. Studies have shown that 52% of Americans are spending more than they earn. Credit cards are a huge part of overspending. A Dunn & Bradstreet study found that people spend 12-18% more when using credit cards than when using cash. Bottom line, using credit cards may increase your chance to impulse buy, make it harder for you to stick to your budget, and makes it a lot easier to overspend.
Gary Barnes offers high-performance business & sales coaching and business boot camps, with the next one scheduled to take place in Denver on May 3-4, 2013. For more information regarding the next business boot camp, visit the site at www.garybarnesinternational.com/maximize-your-business-now-live/.