How To Live Within Your Means

by Ryan Yates

Can you spend less than you make?

Make any resolutions this new year? Already slipping on some of them? Well, if you’ve set a financial goal for this year to spend less, earn more, and get out of debt, I hope this helps you in your fight to stay financially trim.

You’ve Got To Know How Much Money You Actually Make – When I got my first job as an adult, I pulled out my calculator and started dreaming about all of the things I could buy. A new car. An upscale apartment. Dinner at all of the swanky restaurants. Even a jet ski . . . seriously, a jet ski.

What I didn’t figure in was how much money taxes and healthcare would cost. I tend to do that when I get excited – overlook some important stuff. Basically, I was planning to spend money that I didn’t have. In order to live within your means, you’ve GOT TO know what your “means” actually are.

Don’t just estimate your income. Track it, double check it when you get paid, and triple check it when it hits your bank account. There is absolutely no way for you to make smart spending decisions if you don’t know what your financial starting point is.

Spend Less Than What You Make – Spending more money than what you are bringing is not sustainable, no matter how many excuses you try to make. There are plenty of emotional and psychological reasons for why we feel the need to spend too much money. But when you boil it down, the reasons don’t matter.

What matters is being able to control your spending. This step might be the toughest thing for you to do, especially if you absolutely love shopping. But in the end, spending less than what you make will keep you out of harms way – financially speaking.

Ditch the Credit CardsGetting rid of credit cards goes right along with spending less than what you make. Think about it, if we all spent less money than what we made each month, why would we need credit cards in our wallets? We wouldn’t.

Sure, there are tons of cards out there promising bonuses, miles, and rewards. But those are small bells and whistles that try to sucker you into using (an eventually overusing) that company’s credit card.

Hold up your credit cards in front of your eyes and tell yourself, “This is not my money. This isn’t my bank account. This isn’t my emergency fund.”

And Anything Else You Can Think Of – In my opinion, if you can figure out these first three areas of personal finance, you’ll be in a great spot. But there is still plenty more ways to help you live withing your means. Here’s a few more quick tips:

  • Stop hanging out at the mall.
  • Quit trying to keep up with your friends and neighbors.
  • Don’t believe the advertising.
  • Use cash only, don’t even use a debit card.
  • Don’t buy on impulse.

We’d love to hear your ideas.  Leave a comment about how to live within your means.

Photo By 401K

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Pete January 11, 2012 at

We simply said enough was enough; it wasn’t that we weren’t living in our means. We managed to dump a bit into savings every month, but it just wasn’t enough in our minds. So we went extreme, and make one ATM cash withdrawal a week. That’s our food, play, and other expenses money for the week. Gas goes on the credit card (for points, and it’s a pain in the ass to pre-pay with a baby in the car); but it budgeted into the weekly withdrawal.

It’s helped incredibly, and I love paying cash for things. It makes people’s brain wig-out when they realize they have to count my change. 😉

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