What advice can you offer about what things are worth spending more money on and what things it makes more sense to economize?
Health
"Your health should never be taken lightly. Never skimp on the health foods or vitamins, and a gym membership would be particularly beneficial" (Isaac Davies). Insurance is important, any variety of accidents can happen, so be prepared for the worst.
Rent/Mortgage
Where you reside is a major part of your lifestyle and overall happiness. If you are new to a city, you are in a phase of your life that seems likely to bring family changes (like getting married or having kids), or it seems likely that you will move soon, it may wiser to rent until you know what your long-term needs are. For people who are certain of where and how they will live for the next 10 years, it may beneficial to own instead of rent, because "renting can become a vicious cycle that may end up losing you money overall" (Alex Adams). Be realistic with your housing, living in the city is pricier for less space. Safety is another major factor to consider with purchasing a house. In the end, the final decisions regarding how much to spend on rent or mortgage is a personal one, and preference changes with time.
Transportation
Alex Adams’s suggests “buying used cars, instead of leasing new ones, is better”, and there is the repeated advice to consider transportation costs in your budget.
Entertainment
In regards to spending money for non-necessity items, such as entertainment, some interviewees, Barry O’Brien and Julia Gordan, believe that the experience is worth more than a TV subscription. Others suggested that sacrifice in some categories can lead to a payoff in others; for example, if someone focuses on maintaining a quality home with nice vehicles, there will have to be a decrease in the entertainment category. According to Florence Clancy, "living on the cheap" can allow for a major vacation too.
Budget
The overall advice for managing your budget includes being a responsible spender, saving whenever you can and to adhere to the budget. If you spend too much in one area, be sure to make up for it in another. Chris Cain says to “invest more money in things that will depreciate the slowest."
It's hard to resist spending now rather than thinking of the future. This is where a good budget and those savings accounts come in handy. Make saving automatic; many companies allow you to deposit your paycheck into multiple accounts. Don't miss money you don't see, but set aside some "fun money" in your budget too. "Think about your long term goals...a house, travel, maybe a wedding. Thinking about what you're saving for can help you resist splurges now" (Erika Farrell).
Materialistic Goods
When spending on non-necessity items such as clothing, furniture, or shoes, there is an emphasis on frugality in some instances, and splurging in others. Barry O’ Brien gives particularly strong advice in relation to clothing. He suggests to shop at “Ross Dress for Less or Marshalls" for cheaper prices. Get your work clothes there. You’ll be wearing them more frequently since you’ll spend most of your time working, so don’t splurge on something that you’ll beat up regardless. "For men, buying a $250 suit and spending $75 dollars to get it tailored will look just as impressive to everyone as a $900 suit. Get two pairs of dress shoes for $40 each from Kohl's. Use those as your everyday work shoes. You’ll make that pair of $300 shoes last for years and never have to replace them” (Barry O'Brien). O’Brien also suggests shopping at Target as opposed to IKEA for basic household furniture. Tony Golding warns not to buy a cheap bed, but as far as clothes and shoes, "thrift stores might surprise you."
Overall, when considering where to economize, there are a variety of options to choose from. Any of the above categories can be cut down to fit the budget. So long as the budget is adhered to, and if sacrifices are made so that there is no overspending, you can economize or spend how you see fit.
This page was developed from interviews with:
Isaac Davies, Alex Adams, Florence Clancy, Barry O’Brien, Julia Gordan, Chris Cain, Tony Golding, Erika Farrell