Updated: Mar 3
-The hidden cost that actually causes you to spend more money in your budget
-The value of paying more upfront for quality products
Okay so we wanted to talk about some budgeting topics and we've noticed from our younger audience that they've been asking about; what things they can do to better themselves as they start out. So we want to focus on this in the upcoming podcasts.
Stick to Buying Products Over the Long-Term
One rule that we like to stick to is that when you're going to buy things, that you buy them for the long-term. Now this isn't a novel concept but the idea is if you purchase something that's going to last a while and you can afford to do so, then you're going to save more money in the long run. So a good example is that we had our lawn cut by somebody else and it turned out that he was really crappy and it just didn't work out. So, Cindy really likes to cut the lawn so we're back to cutting the lawn.
Here’s where our first example comes in about cutting costs overt the long-term. Rather than paying somebody to do this and choosing to cut the lawn we'll need a new lawn tractor. So I am researching and the tractor that we need and it is about $1,500 and to have someone cut it, the cost about $200 a month and the lawn cutting season is about six months. So if you do the math that's $1,200 or pay $1,500 and so by the time that you get in the second cutting season; or 1.5 months in, we would be breaking even for the cost of the lawn service versus the cost of the lawn tractor. The major difference is that lawn tractors last 12-15 years.
That's the most prudent way to go about it.
Another example is and it might sound trivial, is a garbage can. I’d go to Home Depot and buy one for 50 bucks and every two years it started to crap out. So about two years ago I found a new garbage can that I knew was going to last because it had really good materials. So now I can buy one for $100 and rather than replacing the other one at $50 over the course of 10 years. So, I will pay $100 as opposed to $250 overall and I don’t have to go back and run the exercise of buying it again over the course of those same 10 years.
So it's a $150 difference but that's the concept that really is important that you need to put into your budget and if you can't do it right away, apply this concept to some things that you can and build that up.
These are the things that you win in the end and we know what I'm famous for . . . I always go;. I think this is probably my little Bohemian background but I always go for the deal or the cheapest thing first because just that’s the nature of who I am and I want to save that extra dollar.
I am famous for the runner rugs or the bathroom rugs. I'm a very habitual bad rug buyer and we'll get them home and then either the colors bleed or they'll just start falling apart or the rubber things on the bottom will be falling off everywhere; you can't wash it or you wash it once or twice and the whole thing falls apart. So I realize the value of buying higher quality products that will last you for the long term. For example, the lawn mower or garbage can or the other things that we have around our house. Even gift boxes or a pair of shoes.
I always bought . . . I wanted to collect a bunch of shoes and I’d buy the cheapest pair and then about three weeks later you're asking me why I'm buying another pair of shoes; I am very hard on my on them, but when I bought quality pairs they lasted more than a season or two of wearing them consistently; and I hate spending money on that kind of stuff, but in the end it's really truly how you win.
Create More Disposable Income
It's important to understand what we're saying here; is that budgeting sometimes gets a stigma meaning that you're cheap or frugal. We budget within the means of the money that we have along with our savings, so when you keep repeating the practice of buying things that are high quality and probably spending more money on them up front, you're going to realize the benefit in the long-term.
So I may not necessarily track that I saved $150 on a garbage can or even the lawn mower, but over time when you keep buying things that are quality, the disposable income in your budget is going to increase and you'll notice a difference in your little savings column in that you just have more money to spend from what you had before in previous months or years.