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Preparing For A Major Purchase

talessi@ariesfoundation.org

7 QUESTIONS TO HELP YOU PREPARE

7 Questions to Ask Yourself Before You Make a Big Purchase

It's important to make sure that you're financially ready to make a large purchase--and that it fits in your budget. Everyone hass a different ideda of what qualifies as a big purchase and it depends on several factors from your household income, to the amount of debt you have, or even how much you have in your retirement savings.

When considering making a large purchase, ask yourself these questions before making a committment or signing any paperwork.

1. Can I Pay Cash For The Item?
Obviously we are not talking about buying a home or even an automobile, but for all other items then you should abide by the rule of trying to pay cash. If you can afford to pay cash for all or most of the item—while still maintaining a balance in your emergency fund— then you should be okay purchasing the item. Not needing to pull emergency fund money means that the purchase should not adversely affect your current monthly budget. If you do not have the cash on-hand, or you will be emptying out your emergency reserve funds, then consider holding off on buying, at least until you have a high percentage (more than 50%) saved up to make the purchase. For a home or auto then shoot for at least 25% of the purchase price as a downpayment.

2. Do I Really Need This Item?
Take a step away for a moment, relax, deep breath, and ask yourself the question. By asking if you need the item helps you think about whether you really need it, or if it is something that you simply want to have—a luxury purchase. If it is a luxury purchase, be sure that you can afford it and that you can pay cash for it. If it is a true need, then you need to determine why you need it and when. For example, you may need to buy a car, since yours needs frequent repairs (Need). But buying a top-of-the-line flat-screen TV (Want) just to have it, is a purchase that can be delayed. Determining if the purchase is a want or a need can help you to prioritize it in your budget.

3. If You Do Need the Item, Do You Need It Right Now?
If you do need the item, but you do not currently have the cash for it, is there any way you can do without the item for a short time? For example, ​if your dryer has stopped working and you need to purchase a new one, can you hang your clothes out to dry, or use your local laundromat while you save up for a new dryer? You may also be able to borrow the item from a friend or family member while you are saving up to purchase one of your own. You can also set up a sinking fund to help you save up the costs. 

4. Can You Find a Used One that Will Work?
Looking for used items is a great way to save money on a big purchase. You can buy lawnmowers, refrigerators, freezers, and almost any other item used for a fraction of the cost of a new item. Often you can buy professional-grade appliances and tools this way and end up with a better quality item at a lower price. Take time to research your items to determine if it's a good purchase.

5. Is It Worth the Investment to Purchase the Higher-Quality Product?
It may be worth the money to spend extra to get the top of the line product that will hold up to wear and tear and last longer. For example, you can purchase an average vacuum cleaner at a store for anywhere from $50-$80, but these vacuums often break after a year or two. If you purchase a more expensive vacuum for $500 with a five-year warranty, you may end up saving more money than if you bought a cheaper vacuum and had to replace it a year or two later. This quality issue is especially real if you can purchase the expensive vacuum on sale.

6. When Does the Item Usually Go On Sale?
There are cycles of sales in retail. If you can wait a month for two, you might save a bundle by waiting for the sale. For example, the best time to buy a lawnmower is in October when stores are discounting them to make room for winter items. Specific holidays can bring sales as well, often retail stores will have Memorial Day and Labor Day sales. And there is always Black Friday and the holiday season. Normally just before the Super Bowl is a time when large screen televisions go on sale.

7. Have You Done Your Research?
When you purchase a big-ticket item, you should take the time to research the reviews and issues related to the product thoroughly. You should find a product that has the features you want at the best value. It is always important to go in with a spending cap or budget in mind as well. 

GOT QUESTIONS? ASK US> WE CAN HELP WITH THAT!
The ARIES Foundation for FInancial Education, Inc is a nonprofit dedicated to the mission of trying to help everyone have a better relationship with their money. Visit www.ariesfoundation.org to learn more.
By Thomas Alessi January 5, 2025
Have you ever noticed how New Year's resolutions seem to lose their sparkle by the second or third week of January? If so, you’re not alone. Statistics show that most people abandon their resolutions within a few weeks of setting them. But why does this happen? The reasons often lie in how we approach our goals and the mindset we carry into the new year. One of the biggest culprits is setting unrealistic goals. Many of us feel a surge of motivation on January 1st and decide to aim for major life changes all at once—like losing 30 pounds in a month or working out every single day without fail. While ambition is admirable, these types of goals are often unattainable in such a short period, leading to frustration and eventual burnout. Another common issue is the lack of a clear plan. Resolutions often start as vague statements like “I want to get fit” or “I’ll save money this year.” Without actionable steps or measurable milestones, it’s easy to lose track of progress or get overwhelmed by the enormity of the goal. Without structure, even the best intentions can falter. Motivation fades quickly after the excitement of the new year dies down. Motivation is often fueled by novelty, but real change requires discipline and consistency—two traits that are harder to maintain over time. By mid-January, the initial enthusiasm often gives way to old habits, especially if we don’t have systems in place to reinforce new ones. Social and environmental pressures also play a role. Life gets busy, and as the demands of work, school, or family creep back in after the holiday lull, resolutions take a backseat. Pair this with temptations like junk food or the comfort of skipping the gym, and it’s no surprise that many people give up. Finally, many people don’t account for setbacks. Whether it’s missing a workout, overspending on a shopping trip, or indulging in an unhealthy meal, one slip-up can feel like a failure. This "all-or-nothing" mindset often leads to abandoning the resolution entirely instead of adjusting the plan. ________________________________________ Strategies to Overcome Quitters Day Breaking the cycle of quitting isn’t just possible—it’s entirely within your reach with the right mindset and strategies. Let’s dive into how you can overcome the challenges of Quitters Day and stick to your resolutions long-term. 1. Set Realistic and Measurable Goals The key to success lies in creating goals that are specific, measurable, achievable, relevant, and time-bound (SMART). For example, instead of saying, “I’ll get fit this year,” try “I’ll exercise for 30 minutes three times a week.” By breaking big aspirations into smaller, manageable steps, you’re less likely to feel overwhelmed and more likely to stay on track. 2. Build Consistent Habits, Not Just Motivation Motivation is fleeting, but habits are sustainable. Focus on creating daily or weekly routines that make progress automatic. For instance, if you want to eat healthier, prep your meals in advance or stock your kitchen with nutritious options. Building habits takes time, but once established, they become second nature. 3. Accountability and Support Systems Having someone to hold you accountable can make all the difference. Share your goals with a trusted friend, family member, or even a coach. Better yet, join a community or group with similar objectives. Knowing that someone is rooting for you—or counting on you—can keep you motivated during tough moments. 4. Reframe Setbacks as Learning Opportunities Setbacks are inevitable, but they don’t have to derail your progress. Instead of viewing a missed workout or a bad day as failure, see it as a chance to learn. What triggered the setback? How can you adjust your approach to prevent it in the future? Remember, growth isn’t linear—it’s a journey filled with ups and downs. 5. Celebrate Small Wins Big goals take time, so it’s important to recognize and celebrate progress along the way. Did you stick to your exercise routine for two weeks? Treat yourself to something meaningful, like new workout gear. Celebrating small milestones helps reinforce positive behavior and keeps you motivated for the long haul. 6. Focus on the Process, Not Just the Outcome Instead of fixating on the end goal, shift your mindset to enjoy the journey. For example, if your goal is to write a book, celebrate the act of writing every day rather than stressing about completing the manuscript. When you focus on the process, progress feels more achievable, and the outcome will naturally follow. 7. Leverage Technology and Tools Apps and tools can help you stay organized and motivated. Habit trackers, fitness apps, and budgeting tools make it easier to monitor progress and stay accountable. Life happens, and sometimes your resolutions need to evolve. Check in with yourself weekly or monthly to assess progress. Are your goals still realistic? Do you need to adjust your timeline or strategy? Being flexible ensures that your resolutions remain relevant and achievable. ________________________________________ With these strategies, you can break free from the Quitters Day trap and turn your resolutions into lasting change. The key is to approach your goals with patience, self-compassion, and a focus on progress rather than perfection. Change doesn’t happen overnight, but with consistent effort, you’ll be surprised at what you can accomplish.
By Thomas Alessi December 9, 2024
Budgeting and dieting are two of the most common self-improvement goals people set for themselves. Both aim to bring about positive changes—whether it's financial stability or better health. However, many find that sticking to a budget is just as challenging as sticking to a diet. Here’s why: 1. Restrictive Nature Both budgeting and dieting often start with a restrictive mindset. Just as a diet might cut out all your favorite foods, a budget might eliminate all your discretionary spending. This restriction can lead to feelings of deprivation, making it harder to stick to the plan. Over time, the temptation to "cheat" becomes stronger, whether it's indulging in a dessert or splurging on an unplanned purchase. 2. Unrealistic Expectations Many people set themselves up for failure by setting unrealistic goals. In dieting, this might mean expecting to lose a significant amount of weight in a short period. In budgeting, it could mean expecting to save a large portion of income without considering necessary expenses. When these high expectations aren't met, it can lead to discouragement and abandonment of the plan altogether. 3. Lack of Flexibility Life is unpredictable, and both diets and budgets need to be flexible to accommodate unexpected changes. A rigid diet plan doesn't account for social events or cravings, just as a strict budget doesn't account for emergencies or spontaneous opportunities. Flexibility is key to maintaining long-term success in both areas. 4. Emotional Factors Emotions play a significant role in both eating and spending habits. Stress, boredom, and happiness can all trigger overeating or overspending. Without addressing the underlying emotional triggers, it's challenging to maintain a diet or budget. Emotional awareness and coping strategies are essential for long-term success. 5. Short-Term vs. Long-Term Mindset Both dieting and budgeting often focus on short-term results rather than long-term sustainability. Crash diets and extreme budgeting can lead to quick results, but they are rarely sustainable. A more balanced approach that focuses on gradual, consistent changes is more likely to lead to lasting success. 6. Lack of Support Having a support system can make a significant difference in achieving goals. Just as people might join a weight loss group or hire a personal trainer, having a financial advisor or joining a budgeting community can provide the encouragement and accountability needed to stay on track. Making It Work To make both budgeting and dieting work, consider the following tips: • Set Realistic Goals: Aim for gradual progress rather than drastic changes. • Allow Flexibility: Build in some room for treats and unexpected expenses. • Address Emotional Triggers: Be mindful of how emotions affect your habits and develop healthy coping mechanisms. • Seek Support: Surround yourself with people who encourage and support your goals. • Focus on Long-Term Changes: Develop habits that you can maintain for life, rather than quick fixes. By understanding the similarities between budgeting and dieting, you can approach both with a more balanced and sustainable mindset. Remember, it's about progress, not perfection. Watch our Think With A Drink episode for ways to be better at handling your expenses: The Dreaded B Word
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