Living above your means

If you are not able to pay your bills or are on the verge of not being able to pay your bills, then you are most likely living above your means.  At this point, you are not financially stable and will want to make some changes in your life.  Start by looking at what are necessities versus pure wants in your life.  Here I layout what I would consider some must haves and nice to haves.  There are many-many more than this, but I wanted to share a few examples.

Necessities (must have)

  • Food
  • Regular clothes
  • Utilities (excluding cable)
  • Transportation (work, school, etc)

Wants (nice to have)

  • Cable
  • Vacations
  • Luxurious clothes and jewelry
  • Dinner at restaurants
  • Entertainment (bowling, mini golf, seeing a movie)

The must haves are simply things you need to have to keep living and support your career.  The nice to haves are items that are most likely not necessary for you to keep living or support your career.  For example, we need food to live, but we do not need to eat our food at a restaurant.  The cost of going out to a restaurant will be much higher than cooking at home as I previously discussed in my blog titled, Eating out versus eating in.  Vacations are another nice to have, but not necessary to keep living or support your career.  I discuss vacations a little further in my blog titled, Most relaxing vacation spot.

We really need to be discipline and accept our financial situation.  By ignoring your financial situation and living above your means, you are going to hurt yourself in the long run.  You are accepting immediate satisfaction, which cannot be sustained.  This will also not help you grow or drive yourself for larger opportunities in your life.

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