How to Make Better Purchase Decisions When Money Gets Tight May 20, 2020Featured, My Life, My MoneyOff

To say that the past few months have been challenging would be an understatement. Millions of people have been affected in some way by COVID-19, and the financial impact is just one facet of this ever-changing global crisis. The good news is that individuals can take steps to protect their financial standing even during these difficult times. To that end, here are five ways to make smart purchases when money gets tight:

Prioritize

Reforming a budget requires making tough choices. If you’ve recently experienced some form of financial hardship (losing a job, going on furlough, having hours reduced), then you’ll have to compensate for that lost income through sacrifice. As such, it’s crucial to determine which investments are most important to you and your family. Create a priorities list to help you figure out what expenses you can cut and which ones you can’t.

Look for Solutions –– Not Quick Fixes

Low-priced products and services can be very attractive prospects for people on a budget. Unfortunately, many items that seem to be a bargain are actually poor investments because they aren’t effective. For instance, bunion pads rarely –– if ever –– offer consistent foot pain relief. Similarly, cut-rate tires may end up costing more to replace than purchasing quality tires in the first place. The lesson here is that the product with the lowest price doesn’t always offer the greatest value.

Do Your Homework

Reading product reviews, comparing use cases, and, in general, reviewing every major purchase decision you make will help you avoid needless financial gambles. When in doubt, don’t hesitate to call an expert for help!

Become “Brand-Blind”

Successful businesses work very hard to build up their brands and establish brand-loyal customers. Yet, the reality is that there’s often very little difference between “brand-name” products and cheaper alternatives other than the packaging itself. If you’re looking to free up extra cash, make it a point to resist the urge to buy brand-name products when there are cheaper, equally viable options readily available. 

Wait

It’s hard to be patient. And, of course, sometimes you may not be able to wait to make a purchase decision. In many instances, though, it’s possible and quite beneficial to give yourself plenty of time to review a problem before you make a purchase. Obviously, exercising restraint can help eliminate costly practices like impulse buying. In addition, waiting to purchase a new product can give you time to try and find a different solution. For example, rather than calling a plumber to fix a leaky faucet, you could take an afternoon off and tackle the problem yourself. Playing the waiting game might be tough at first, but it could help you save up in a meaningful way.

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