Whether you’re aiming to be financially free, or you want to save more money or maybe even get out of debt faster – living below your means is one of the best ways to go.
Living below your means is one of the most basic yet effective steps to take in achieving financial success.
I used to love living beyond my means. Using credit cards to pay for all my unnecessary splurges. Constantly trying to fill a void without really taking the time to realize that living this lifestyle was only putting me in a much deeper hole than I already was.
I swear, every time I see all the bills piling up, my heart just sinks.
It was causing me so much stress, a lot of sleepless night and days spent constantly worrying about how to stay afloat until the next paycheck comes.
I knew that this has got to stop. So, I vowed to myself that one way or another I will stop living this lifestyle, no matter what it takes.
And, yes, I admit. It wasn’t easy. It wasn’t something that you could easily master overnight but it was definitely worth the effort.
Choosing to shift that lifestyle and learning to live below my means is probably one of the best decision’s I’ve made!
After having to quit my 9-5 job and without having any stable income streams, since I was jumping from one side hustle to another, learning to live below our means was a total lifesaver.
It saved us from all the constant worrying and stress. Plus, it even helped us get one step closer to financial security.
Remember, that choosing this lifestyle doesn’t mean that you’re cheap.
Living below your means doesn’t mean that you have to resort to extreme measures just to stretch every dollar.
It simply means making wise decisions and choosing to invest your money in things that really matter without sacrificing the welfare of your family.
And to help you get started, I have decided to gather 6 Effective Tips to Successfully Live Below Your Means.
Check them out!
Know and Set Specific Goals
Oftentimes, the reason why it’s so easy for some people (including me) to blow off their paycheck is that they really don’t have a clear-cut or specific Financial Goal.
We all know that we want to save money, we all know that we want to achieve financial freedom but the problem is some of us don’t know the specifics.
Like, how much money do you really want to save, what’s the specific time frame, why do you want to save money, what’s your long-term goal.
One thing I’ve realized is the more specific we are with our goals, the easier it is to come up with a concrete plan to achieve it and the more driven we are to start and stick with it.
So, take the time to sit down and figure out what your goals are. Write them down.
Also, making a list of what motivates you to live below your means really helps.
It makes it easier for you to actually execute it since you already know the benefit you’ll get from doing it.
Track your Spending
Now that you have yourself a specific financial goal, it’s time to get your hands dirty and track your spending habits.
Being aware of how much money I had going out for every specific expense gave me a much clearer vision of how much money I was blowing off on all the unnecessary things.
It was messy and it did give me a headache, considering all the bad money decision’s I’ve made but it sure was worth it.
Especially nowadays where almost everything is just a one-click purchase, it’s just so easy to fall into the trap of spending mindlessly.
Tracking your spending prevents this. It forces you to acknowledge all your mindless spending and it makes it so much easier for you to identify and notice all those unnecessary expenses.
So, allocate a few minutes of your time to sit down and track your spending habits.
Trust me, it’s worth it!
Eliminating the Unnecessary
After tracking your spending habits, the next best thing to do is to start evaluating all your bills.
Do you have any unnecessary memberships? Subscriptions that you are no longer using? Paying for cable but not really using it?
Reevaluate all your bills, check what bills you are willing to cut off to save more money.
Consider down-sizing those big bills. Look for cheaper alternatives and consider other options.
Look at your expenses from a financial perspective and determine what things you are willing to give up to reach your financial goals faster.
Remember, the sacrifices that you are willing to do now will reward you tenfold in the future.
Create and stick to your Budget
Be the boss of your own money. Give every dollar a job by creating a realistic budget.
Creating a realistic budget will guarantee you that every penny that you make is accounted for. It will help you avoid spending on things or services that don’t help you reach your financial goals.
Doing this will also give you a clearer concept of where your money goes and how fast it goes out.
Just make sure to create a budget that is workable for you and your family. Something that all of you are willing to commit too.
Doing this will make it so much easier for you to really stick to it.
Another tip, make sure to also add “savings” as a part of your budget. Doing this will help you prioritize it more, instead of just blowing it off once your paycheck comes.
Don’t Elevate your Lifestyle
Back when I was still working my 9-5 job, I remember wishing of getting a raise so I can save more money.
Then I got this promotion with an increase in salary, but did I end up saving money?
No.
Instead of saving the raise that I got, I elevated my lifestyle.
And I knew that was one of my biggest mistakes.
Don’t make the same mistake that I did. As much as possible, if you get a raise or a bonus, save it or use it to pay off a debt.
Pretend like you didn’t get the raise and use the money on the more important things.
Persevere
Shifting from living beyond my means to living below it was not easy. It took hard work and sacrifice.
But I didn’t let it stop me. I continued to move forward. If a setback comes, I pick myself up and get back on track.
Remember that the key to achieving any goals, financial or not is to always persevere.
Recognize that it’s not easy, setbacks will come, you might encounter roadblocks along the way, navigate through them and just keep moving.
Focus on your goal. Keep reminding yourself that all the sacrifices that you are doing now will reward you tenfold in the future.
Choosing to live below your means is not easy but it is completely doable. All you have to do is to recognize your financial goals and decide what you’re willing to sacrifice to reach that goal faster.
You don’t have to master this all at once. Just take small steps. The important thing is to not give up once it gets hard.
Don’t let any circumstance deter you from achieving your financial goal.
Your Turn…
Do you have any tips that you would like to add? Let me know in the comment section below or send me an email. I would love to hear from you!