WHEN TO SPEND:
- Health Investment. Yes, it is the most important. As what everyone will tell you, health is wealth. This doesn’t make you literally rich, but you will save yourself from hospital and medicine bills which is usually a big amount of money. You will not avoid being sick in your entire life, but if you manage to spend more to healthy options early on, the more you will save later.
- Choosing the best PC. At a first look and thought, you would always go for the cheaper one. But if you come to think of it, the best deals when it comes to computers are almost always not on the cheapest one. You want to end up with a lighter computer with better battery life and stronger processor – portability, longevity and speed are the main consumption of computer, if you settle with a not-so-functional-but-more-affordable one, expect to buy a computer again after a short period of time. Allot a budget for a good computer especially if you’re going to use it for work or any important matters. You don’t want to be welcomed by a blue screen on valuable situations, right?
- Building your house. It’s sure that your house is an investment itself, but be careful on your home improvements like upgrading your kitchen and adding a pool. It’s understandable that you want to maintain a comfortable home and you want to make it easier to sell, if ever, someday.
- Go on vacation. It may not be advisable to some, but vacations are the most rewarding things because it gives you unique experiences especially when you’re with people you love. If you can, splurge on vacations especially if you’ve been frugal throughout the year.
WHEN TO SAVE
- Airplane Seat. Everything is absolutely the same; don’t make an effort to book the best seat. Promise, you won’t notice any difference on economy to business class. No, it’s not worth it.
- Extended Warranties. Any kind of extended warranties on electronics are more or less worthless because if something goes wrong, say on your refrigerator, it will occur on the duration of your manufacturer’s warranty. Also, the cost of extended warranties is almost of the same price of a new appliance. Might as well, buy a new one than spend it on extensions.
- Luxury Cars. For sure, it’s something to own a car, but be sure, don’t focus on something that will not be useful to you as the owner. Forget about pride and ego, save on car cost. Don’t buy expensive cars because you will pay far more than its worth.
- Kiddie Parties. Your kids, especially when they’re too young, won’t even remember you held a party. It’s great if you keep that fund for extravagant kiddie party for their college fund or emergency cases and your future self will thank you for that wise move.