Aside from becoming full-fledged parents any time soon, we also have big plans for our little abode this year. Those plans involve buying the next door unit from my brother and then fixing it up to create more space for our growing family.
I know the plan by heart, but I still find myself being not as responsible as I should with spending money (case in point, spending for last night's pizza dinner for the fambam because it makes me happy to be around my nieces and nephews and pizza makes them happy, so... :p). This article from Learnvest thus pressed all the right buttons and made me come up with my own Phrase to Save.
To date, the budget for the renovation is about Php150,000 to Php175,000 and that includes breaking down a piece of the wall to join the 2 units (Php25,000), having a new kitchen area with island set up (Php50,000?), buying a new oven/ gas range (Php30,000?) and installing 2 sets of storage areas (bookshelf and cabinet).
Our Phrase to Save comes in during our daily life, and pretty much compels us to rethink our purchase to see if it is more important than our planned renovation, because every purchase made will inevitably be a step back from our renovation goal.
How do you wrap your head around a number that big when you’re thinking about your daily expenses? Is my $20 savings at the grocery store really going to impact a number that big? It doesn’t seem likely. And because of that disconnect it was hard to see how our daily activities impacted our long-term dream. It wasn’t until we made the connection about comparing what we wanted to do on a day in our dream life to what we were currently spending that it finally clicked.Our Phrase to Save will basically go like this: "Is eating out at our favorite Italian restaurant worth more than adding to our kitchen unit budget?"
Or it can also go: "Do I need this new pair of shoes enough to take it out of my floor to ceiling bookshelf budget?"
Something like that.
So there, having a set goal will hopefully make us accountable for our every financial action and limit mindless spending.