How to Decide if You Can Afford Something

We live in a relentlessly materialistic world. We are constantly told that we need to buy more and bigger. Every day there are dozens of new must-have items on the market which you just have to buy.
Only, of course, you really don’t have to buy them.

So how can you tell if you can really afford to buy something? Actually there are ways for you to know – although many people close their eyes to these ways so they can convince themselves that they can continue to buy, buy, buy even when they obviously can’t afford it.

If you’re ready to open your eyes to the reality of your current financial situation and make some of the hard decisions that are going to be forced on you in order to decide whether or not you can actually afford to buy something, then read on.

First, decide if you want something or if you need it. Would your life be significantly altered if you did not buy what you are considering buying? If there is not a pressing need to buy something, and you feel in your gut that you really can’t afford it, then don’t buy it.

But what if you want something but you’re not sure if you can afford it? How do you make the final decision? Start by asking yourself if you can afford to pay cash for the item you want. If you can honestly answer “Yes” to that question, if you can afford to pay cash for an item without it affecting your ability to pay for the other necessities of life then you can probably afford to buy it.

But let’s get real. The question of whether you can afford something or not really comes down to a question of when should you use your credit and when shouldn’t you. Credit card debt in this country is out of control. Far too many people owe far too much money on their credit cards, money which in many cases they will never be able to pay off entirely.

So when should you use credit? The answer is simple. You should only use credit to make a purchase when you have a clear plan for how and when you will pay back the loan. In other words, you should never pull out your plastic and make a major purchase unless you are willing to commit to paying a certain amount each month toward paying off the debt and you can look yourself in the mirror and tell yourself the exact day the loan will be fully repaid.

If you can’t do that then you are living in a never, never land of dreams and wishes and hoping for the best and you really can NOT afford to buy what your heart is set on buying. Once you have made enough purchases that you really can’t afford, it won’t be long until your financial house of cards comes tumbling down around your ears.

So remember – if you can’t make a genuine commitment to pay a large percentage of the purchase price of an item each and every month until the item is fully paid off, then you cannot afford to purchase that item.