How do I know what I could/can't afford?

amother

OP ↓

Thu, Jul 25 2024, 12:31 am

I have a hard time spending money. We bH have enough for everything we need and some of what we want. We recently moved into a new house, and there are many things we said we would do or buy slowly, like furniture, closets, mudroom, awning, etc... these things range from $$$-$$$$
How do I know when I can afford these things? (And I even deliberate over way smaller purchases.)I always think that maybe I should be saving more money for essentials or marrying off the kids.
On the other hand I feel like when I spend money, I don't really feel the difference a couple of months later. Is there a specific amount I should be saving, and more than that isn't necessary to save, and I can feel free to spend it?

amother

Cerise

Thu, Jul 25 2024, 12:34 am

Have multiple accounts, spending, short term saving, and long term saving. Decide how much to put into each account a month. When short term savings has enough you can get the house things.

amother

Babypink

Thu, Jul 25 2024, 8:08 am

I'm like you and have a hard time spending. I agree with the above poster.

I find that what puts my mind at ease is to make a separate account for something. Say the mudroom. Every week/month, along with my regular savings, expenses, bills, etc., I'll put $X in there and that is what I'm free to spend on whatever it is.

I have a 6 months of savings fund that gives me anxiety to touch. But what if my fridge breaks or a pipe bursts? Now I have a fund that I can touch for those things and I'm OK with that.

amother

↑ OP

Thu, Jul 25 2024, 2:58 pm

amother Cerise wrote:

Have multiple accounts, spending, short term saving, and long term saving. Decide how much to put into each account a month. When short term savings has enough you can get the house things.

Thank you, this is a great idea. Now I just have to convince DH to do this. He doesn't believe in this

amother

Cinnamon

Fri, Jul 26 2024, 7:13 pm

I can relate to this. We just bought a house last year. Prior to buying the house, all of our extra funds went to saving for the house because I felt like it was the biggest purchase I would ever make so I wanted to have as much money as possible. We bought the house, renovated pretty much the entire interior and now have small-medium projects we want to do (fix the backyard, window treatments, etc). I'm not used to having "extra" money since before everything went to saving for the house. You don't necessarily need different accounts but you do need a set amount you want to save and anything over that is money to spend on your house. We focused this year on rebuilding our emergency account. Next year, we're going to save half of our extra disposable income, use 25% to finish paying off our two-year 0 interest credit card we used during the Reno and use 25% to do our backyard. If something Chas vshalom happens and we need more of our disposable income, we would just push off the backyard a year.

Basically, pick a non-negotiable amount you want to save and use the rest for your home projects.