Five steps to take before making a large purchase
Bitten by the gotta-have-it bug? It could be festival tickets, a trendy watch or a new entertainment system. Before you go ahead with the purchase, take a moment and run through these steps.
Step 1: Wait it out
Many purchases seem like a must-have, but that urgency may fade once you wait it out. Take a break for a few days, a full week or even a month to see if you really need it. After time has passed, you may find that you can live just fine without it.
Step 2: Consider your emotions
Take a moment to identify the emotions driving a purchase decision. Are you feeling upset and want something new to cheer you up? Trying to keep up with friends or family? Be honest with yourself about what’s really inspiring you.
Step 3: Review your upcoming expenses
Are you anticipating any large expenses soon? Even if you have the funds in your account to cover this purchase, you may need that money later. Don’t spend money today that you’ll need tomorrow.
Step 4: Find the cheapest source for the item
If you’ve decided to pull the trigger, there are still ways to save. In today’s online world, comparison shopping is easy. Browse multiple websites to find the retailer selling the item at the best price.
Step 5: Choose your payment method carefully
Cash or debit could be the best options if you have the funds on hand now, but a credit card can offer purchase protection. Or a buy now, pay later program could work if you have 25% of the purchase price saved up and are willing to pay off the rest in fixed installments.