When I decided to make a move across the country more than 10 years ago, I walked away from a career making close to six figures. I was able to maintain my lifestyle without going broke on an income closer to minimum wage. Granted, I never had a lavish lifestyle to begin with. But, I think the real secret to living on a low-income without going broke was asking the right questions before spending money. I brought with me the hard-earned money I had saved for about 5 years before moving. Although I eventually was able to boost my family's household income, I lived several years on a low-income salary without going into debt. Before spending money, I'd do what I called "deliberating on my dollars."
What's it cost with interest?
Every time I pulled out my credit card, I figured out how much I would be paying if I had to pay the interest. Even though it took me a long time to save for big ticket items, I saved thousands in interest. By the time I saved up the money, the item I wanted was usually obsolete. I could find the same thing at a thrift shop for a fraction of the price.
Do I need to hire someone?
Before hiring anyone to do anything for me, I'd ask myself if I really needed someone else or if it was just a matter of convenience. Although it was uncomfortable, I forced myself to rely on family and friends. I found my older son was a pro at putting together electronics and furniture. My younger son actually looked forward to mowing the lawn every week without expecting any allowance just because he loves the outdoors.
Am I making a value purchase?
I didn't just think of the material value of the item and whether or not it was on sale. I thought about whether the product or merchandise would add to my personal values. I stopped buying things that didn't get me closer to my goals or add value to my life or my children's lives.
Will I have buyer's remorse?
I contemplate whether I may regret my purchase decision and why. I often have physical symptoms of distress such as an upset stomach or headache when I know in my gut that I shouldn't buy something. Most often, I felt more comfortable buying things my family needed as opposed to items we simply wanted. I felt better living below my means no matter how small the means.
It wasn't easy to live on a lower income, but I managed to put off big purchases. I continued to save 10 percent of my income even though it was not a lot. As my income increased, I was able to become a homeowner. As our household income grew, our expenses grew as well. I believe the reason I'm able to keep debt to a minimum even to this day is because I take a minute to deliberate on every dollar. I just have to accept the verdict if the answer is "guilty of foolish spending."
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