Almost anyone who handles a household budget would be on the lookout for habits that would yield financial benefits for them and their monetary goals. Some would prefer the more conventional and time-tested habit of saving a certain percentage of their income and putting it in savings to tide them through their future needs. Forbes.com explains that the amount you need to save varies on circumstances and you should not be tied down to a 10% or 20% rule.
There are also those that decide to take in two to three jobs just to be able to reach their financial goals in life and deal with financial challenges. They clock out of a nine to five job just to clock in with their second job and sometimes a third on after that. They get home feeling exhausted and with everyone else already sleeping just to leave the house again the next day so early no one is awake yet.
Life is hard especially when you are trying to make ends meet with your finances. This is why people sometimes grab the first opportunity to pick up habits that will lead to monetary benefits for them and their family. But the problem is that there are too much pieces of financial advice out there that confuses consumers on what to do and what not to do.
That is why it is surprising to some if not most of the people who are trying hard to manage their finances to find out that a simple “no” can lead to financial gains. Of course this is not to undermine the hard work and dedication of all those that are trying to hold multiple jobs just to survive but this is a way of complementing that financial approach.
How saying no can save your finances
It is not an automatic switch that when you say no to a lot of things, you immediately reap the financial benefits linked to it. You need to put in some thought and process into it to make sure that you are doing the right thing and not damaging and haunt your finances further. Here are a few things you can look into to make sure that saying no helps.
- Financial need of your family. There is nothing wrong with helping out your family and just like the saying that in the end, you will have your family to lean on. But if it means that you will have to be in debt just to help out then better rethink your next move. The best thing you can do is gauge how much you can afford to give to your family as financial and stick to that amount. Think twice when you have to put your budget on the line because if come up short then you end up in debt and might have to ask them for help as well. It will be a vicious cycle that your family might not be able to get out of. It might be a lot easier when you still do not have a family of your own but once you get married and have kids, your finances becomes more demanding and complex.
- Bailing your kid out of trouble. Your kids will all grow up and starting at the point when they enter college, they will start leaving your house and explore the world on their own. As a parent, it is your responsibility to help them reach their goals even with their finances and you should set up a college fund for their higher education expenses just like the 529 plan as shared by SEC.gov. But outside that, they need to be able to tend to themselves especially if they are already holding a steady job. When they come knocking on your doors, it must be to visit and see how you are doing and let you spoil your grand kids. You better think twice if they come asking for money and at that point you need to talk to them to see why they need money. It might be a matter of setting their priorities straight or helping them fix their budget.
- Favors for other people. This is a common problem when you are still single or already retired because people think that you have all the time in the world to help them out. But financial benefits can come from saying no to some of these favors. First off, you need to remember that you live your own life according to your needs and at some points wants and you put in the hard work to get where you are. You do not owe them your time and you can spend it living life especially when you hit retirement. You will do favors for family and friends like looking after the house or the kids because you love them and like to help out not because you owe them anything.
- Increase in lifestyle. You definitely need to say no to increase in lifestyle even when you have an increase in income because this will only deplete your budget and you will fail to realize the numerous financial advantages of having money to invest or use for emergency funds. Make sure to check your spending when you experience a spike in your income. You might be too tempted to start buying things that you do not even need in the first place.
- Taking in more debt. One of the things you need to look closely at is saying no to more debt as USAToday.com shared that 8% more people aged 65 and older have debt from 2001 to 2011. It can be swiping your card because there is a mallwide sale and those shoes that you want is on sale. You need to watch how you spend also thinking that you have been depriving yourself for far too long and that you deserve those new things that you want to buy. Try to remember why you opted not to buy those things in the past and keep your sights on your long term goals to get you financially grounded again.
You need to know that there is a chance that you might go a little too far with this financial habit. Once you go overboard, you risk running into problems rather than experiencing the financial gains for your money. You might think that you are saying no to expensive food choices but in reality you are limiting yourself to noodles all day. This can be dangerous because you might miss out on vitamins and nutrients your body needs which can get your hospitalized.
You might also be doing pretty weird things in an effort to say no to some life necessities like turning off the heating system at home or eating with candles on the table. There are some things in the house that you can manage but not to the point that you deprive yourself making living a little unbearable. Moderation is the key and not outright deprivation.
When you get the hang of saying no the the things that will ruin your finances, you will then see the financial benefits of this decisions. You get to realize your financial goals that can cover both short-term and long-term plans. It can be as simple as maxing out your 401(k) for the year or being able to send out extra house or car payments on your lenders. You just need to know where you can cut down and say no and where you need to moderate.