There are cliché phrases like “follow your passion” or “be yourself” that we see so often that we don’t even pay attention to them anymore, but there are some that are clichés because they have some truth (that rhymed without trying 😎). Here I am going to put some that apply financially and that have helped me a lot to manage my personal finances.
Don’t spend more than you earn: If I had to choose a phrase that has served me, it is this one, and the best thing is that it is the clearest of all. Simply if you earn $20,000 pesos monthly, do not spend more than $20,000 in a month. Here comes the question: but what if it is an investment for which I need more money?: getting credit for a house, a car, or to set up a business. In these situations, you have to see it case by case. For example, if it is credit for a house or car my rule is that the monthly amount to pay for that credit plus the expenses I have do not exceed those $20,000 you earn, while for a business other things would have to be seen, I think it is a special case.
Don’t buy things you don’t need, with money you don’t have, to impress people who don’t care: Everyone can buy whatever they want with their money, but this recommendation is very useful. Are you buying those $4000 sneakers because you really need them and like them a lot? Or is it so that others say “ufff how nice your sneakers!”? And the worst part, are you going into debt to buy them when you could buy ones of the same quality but cheaper? If you play the game of wanting to impress others, you already lost.
Cheap is expensive: All products have prices that vary from very cheap to exorbitant prices. The key is to find the point where you buy something of quality, but paying more will not increase your happiness/comfort/quality of life. When something increases any of these things I think it is worth saving and paying more for it. For example, I see it a lot in fast fashion vs quality clothing, and more in pants, in denim I always choose Levi’s (Note: Levi’s does not sponsor this). There are pants from $300 pesos, but they last me about 4 months and tear, stretch or fade, but Levi’s can last me 3 to 5 years without being damaged, even more if my wife didn’t force me to change them 😂. But I wouldn’t buy pants for $2000 or more if Levi’s already “get the job done” and serve for the same thing either; they would have to have something extra like being much more comfortable or being for a special occasion.
I hope you see these phrases in a different way, wisdom is hidden in them.