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Smart Shopping: How to spend your money wisely

Smart Shopping skills are extremely necessary in this day and time, when we have so many online and offline product options. We are bombarded by ads for everything: clothes, food, gadgets, vacations, experiences, software, you name it. 

Since most of us are designed to want nice stuff for ourselves, we sometimes fall for it and buy things we don’t actually need or even want. This is especially true for younger people or those who don’t understand or value money and how finance works. 

I developed my smart shopping skills in the last few years, although I was always careful with my money and usually underspent my budget. But what the last few years have taught me was that I need to be more aware of my finances and my monetary goals. 

I used to get my salary and spend what I needed, only checking my bank account a few times a month, just to make sure I still have enough money to support myself. 

But when I started to have big goals, like getting a car, going on a more expensive trip, or changing my couch, I realized I had to actually plan and save my money in advance. I couldn’t just withdraw what was in my bank account that month, because it wasn’t enough. I had to know how to spend money wisely.

So slowly, I’ve learned to:

  • Set financial goals;
  • How to save money to reach those goals;
  • When to shop and when to save for later;
  • How to budget
  • …and more.

That’s why now I know how to do smart shopping. I know when to actually spend the money or when to say “I don’t need it”. And I want to help you achieve that, too. 

If you want to know how to spend your money wisely, here are 5 vital questions you need to answer before actually making the purchase: 

1. Do you actually need it right now?

When you find yourself in front of the computer (or a cash register at the mall), with a card in hand, ask yourself this question: “DO I ACTUALLY NEED THIS PRODUCT/SERVICE RIGHT NOW?”. You would be surprised how many times the answer will be NO.

Before buying, ask yourself if you really need that product at this moment. Can you live the same life without it?

Let’s say, for example, you’re just about to buy a pair of leggings for home. If you have at least two other pairs and you use them or are still good to wear, then you probably don’t need the third pair you are about to buy.

The only way the answer is YES is when you actually need that product and / or you can’t go on without it. Like, for example, if winter is coming, it’s about to snow, and you have no pairs of winter boots, you only have sandals and sport shoes. Then yes, you need to buy a pair of boots in order to be able to walk in the snow. 

2. Can you afford it?

If the answer to the first question was YES, then it’s time to ask yourself the second one. 

Did you budget for it? Do you have enough resources to acquire it? 

If the answer is YES, lucky for you, go for it…..or better yet, go to question 3.

If the answer is NO, maybe you should hold on until you have the money saved up for it.

Also, if you’re thinking about putting it on your credit card, I do not recommend that, especially if you know yourself to have overdrafts on credit cards. Do not go into even bigger messes that will be hard to get out of. 

So if you need the product / service and can’t afford it right now, learn how to save money and get the product / service when you can. It will save you money in the long run and make you more responsible.

3. Can you get it cheaper from another place?

So you’ve decided you need to buy it. You have the budget for it. Next step in the smart shopping process is finding the cheapest option on the market. 

I don’t mean you should go for the cheapest winter boots on the market (talking about my previous example). What I recommend is to find a pair of boots you like, and then look for it at the lowest price you can find online or in-store.

Say, for example, you decide on a Steve Madden pair. You look for it in at least 3 or 5 stores and go for the cheapest option available. This is how to spend money wisely. If you can find a deal, go for it, it will save you money. 

4. Is it an investment? (will you use it for a long time?)

This is one of the key questions you have to consider when buying something. Is the product / service worth the price tag? Better said, should I invest in it? 

This definitely applies to bigger purchases, like couches or cars. Things that cost more, but you can use for longer periods of time, therefore have a good return rate. The longer / more often you use, the more you can actually invest in it. Why? So you don’t have to go back in a year and purchase a new one, therefore spending even more money. 

One of the most important things you need to know  when it comes to how to spend money wisely is when to invest in something and when to not.

5. Do you have other financial priorities that you need to focus on?

Before making any non-essential purchase, you need to consider your financial goals. Are you saving up for something bigger and more important? Is that specific goal a more important one then the one you are contemplating spending on? 

This is smart shopping 101: prioritizing your spending. In order to learn how to spend money wisely, you need to figure out your priorities and actually focus on them.

So, for example, if your main goal is to buy a car, but 3 months later you realize you need a couch, you have to figure out which one is more important. Should you spend money on the one you use all the time for transportation, or the one you spend your nights on, and is it still functional? You choose.

That’s it! I hope, actually, I’m sure that answering these 5 questions every time you want to buy something will eventually lead to you spending less, therefore saving money.  

Smart Shopping is the future, and in these trying times, you need to know how to spend money wisely!

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  • Reply
    March 12, 2021 at 4:00 pm

    Great article! This is something I’m working on — saving ahead for big trips, a house, etc. that I can’t just pay for at the moment. I love all the questions you posed. I need to ask myself those more often!

    • Reply
      March 14, 2021 at 1:56 pm

      So glad I could help! Good luck with the saving part!

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    Jennifer Record
    March 19, 2021 at 10:50 am

    Good reminders and motivation to focus on my REAL priorities..Also, I love the feel of your blog..easy to read….

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      March 19, 2021 at 11:28 am

      Thank you so much, I’m so glad you’re having a great experience reading it, it’s so important to me. Have a great day!

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