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Something awful happened yesterday. Our Keurig stopped working. Ever since we had a power outage a few weeks ago, it’s been a little temperamental. Today it gave up the fight. If you know me, you know I love my coffee. We love our Keurig. It has prime real estate on our tiny counter. We have special organizers for our K-Cups. We’ve even traveled with it. So now what?
If this had happened two years ago, I would have been at the store on my lunch break buying a new one, with or without a coupon, with or without the money. I wouldn’t have thought twice about putting it on a credit card. It’s a necessity, right? But now that I am staring at six figures of debt, my outlook has changed. I’ve started questioning everything. Let’s talk about what you should consider BEFORE you spend money so you can avoid regret and guilt!
Do you have cash to cover the purchase?
Can you spend this money without going into debt? Do you have cash on hand to cover the purchase? I don’t mean physical cash. It could be money in your checking/savings account. I just mean that you should consider if you can actually afford it.
This used to be an afterthought for us. We would buy something and then “figure it out later.” That usually meant using a credit card for something else when we realized we were short on cash. That has totally changed since we started using YNAB. Now we consult our budget before spending. Imagine that.
Do you need this money for something else?
What will you have to give up if you spend this money? If this money is supposed to pay the electric bill, what will you do when that bill is due?
In our case, we don’t have any money “available” for a new Keurig. We don’t have a line in our budget for new appliances, big or small. Hopefully someday we will have a savings fund for that, but not until our debt is paid off. We do have a $1000 Emergency Fund. It sure felt like an emergency at 5am on Friday when I didn’t have coffee, but is it really? How do we define emergency?
We also have money in our Christmas fund. Is coffee more important than Christmas gifts? We could use money from the Christmas fund and hope to replenish it over the next 4 months, but we keep doing that. Borrowing from yourself is still borrowing. We’re trying to get out of the borrowing mentality. That’s how we got in this mess in the first place.
So where does the money come from? When you’re not willing to use a credit card, you have to figure this out. Spending money that’s not planned means something that was planned has to change.
Is this something you need or want?
Do you NEED to spend this money, or do you just want to? If you are trying to get out of debt or plug spending leaks, ask yourself WHY you are spending. How will you benefit from this spending?
I think we absolutely should have fun, and there’s nothing wrong with spending money on something just because you want to…if you can afford it. We want a Keurig, but do we really need it? Let’s get real. It’s totally a luxury of convenience. It’s not a necessity in life.
Will you regret it later?
How many times have you looked at your bank balance (or empty wallet) and wished you hadn’t spent money on certain things? If you bought something tangible (like clothing or electronics), maybe you could return it. If you spent the money on food, drinks, or other entertainment, there’s nothing you can do. If you find yourself rationalizing, that’s a red flag that you probably shouldn’t be spending.
We are masters at rationalizing. For years we talked about wanting to get out of debt, but we always had some way to justify a new purchase. This outfit will make me feel better about myself. This phone takes the best pictures. This night on the town is a stress reliever. But ultimately, more spending led us to more stress because we couldn’t afford it and kept going into more debt!
Is there a lower cost alternative?
Depending on what you are spending money on, there may be other options that will work just as well. Do you need the newest name brand phone, or is there an alternative? Do you have to go to the restaurant with $30 entrees, or could you opt for a more affordable restaurant? Do you have to buy an outfit for the wedding you are attending, or could you borrow something from a friend?
Thankfully I had some overtime on my paycheck that I received this week, so I was able to use that “unbudgeted” money towards a replacement coffee maker. But here’s the shocking part. We didn’t replace what we had. Instead of spending $140-160 on a new Keurig, we spent $40 on a plain old coffee pot. You know, the kind that requires a filter and coffee grounds. It’s been 8 years since we’ve used a standard coffee pot. I seriously don’t even know how to use it. This might sound like common sense, but it is a huge behavior change for us.
How do you handle unplanned spending? Do you have a different approach? My way might not work for everyone. Comment below to share your ideas!