Re-purposing Foregone Expenses
November 1, 2022
A decrease in household expenses has the same effect on your pocket book as an increase in income. A good example of this is the one that Scott O’Connor used in September’s Money Tip of the Month… when your child goes off to elementary school, you now find yourself with $1,000-$2,000 per month that you’re no longer shelling out to daycare. The best thing to do with that money is to repurpose it (QUICKLY) so that you don’t spend it. We, as humans, have a tendency to spend what we make. If you can trick yourself into feeling like you make less, then you’ll find a way to live within those means. I promise.
Another example is when you finally finish paying off a loan. Say you were paying $300/month toward that loan. Instead of spending that “newly found” $300, you can apply it toward a different loan or credit card debt, or you can set up an automatic transfer into a savings account or retirement account. Don’t let human nature win this battle!