Monday, February 2, 2015

Three golden rules regarding spending money

Money is quite important. You may say nobody can buy happiness with money. It is true, but not vice versa. Lack of money makes you difficult to feel happy. For this reason, learning how to use finite money is essential.

I believe there are three golden rules about this issue. All of them are not my original idea, but someone told me or wrote one in a book.

1. Do not spend money on goods, but spend money to experiences.

I read this principle recently, and I agree with it. If you bought a luxury goods, when knowing that someone bought a gorgeous one, your satisfaction would be spoiled, according to the article.

My understanding is a little different. The value of any goods begins to diminish after you got it. An extreme example is a house. You can sell the house for only 70% of its cost immediately after you bought it. Of course, many gadgets will be replaced by a new product soon. It is only the moment you get it that your item deserves what you pay.

In contrast, experience and memory become more beautiful when the time has passed. This tendency is stronger if the activity is shared with others. An experience that can be done only in the time is more worthy than its actual price.

2. Be aware to the trade-off between money and time.

Money is limited. But the time is also limited. Not the time, but your time. We are all mortal.

You may have experience buying a cheaper item after long seeking. It costed lower, but you spent time. Was it a good deal for you?

The value of time is increasing as you get older. The reason elder people take a taxi is not limited to their physical health problem. Saving time by using a taxi is more concerned about them. It is the same that billionaires buy a private jet. Time is money, sometimes much more. You should not miss the chance to purchase the time for low cost.

3. Do not spend money on your job, but spend money on your fun.

The last thing is related to the first. A fun experience is worthy to buy. It is fun because you buy it with money. If you experienced it as a work, you would not enjoy it completely.

Some people spend money to brush up their skills. It is not bad, but not so recommended, to be honest. The most efficacious way to learn something is to teach it to another person. When you notice it, you can change yourself from a student to a teacher. The benefit of gaining skills is equal, and you earn money instead of spending it. Fantastic.

Indeed, I spend money to study abroad. But I do not think this cost is for learning. Every experience in the UK is a fruit for me and extreme fun.

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