Last Sunday, I and Ruchi were
having discussion on finance (hmm…hmm…). She wanted a credit card because a
sweet girl from a bank was soft-selling it. Well I wanted to meet that sweet
girl, but that could be another story altogether. Coming back to the point, Ms.
Sweety tried to persuade Ruchi by
telling her that she will have 10% discount on the stuff she purchases and also
that the card is free for the life-time.
I am a very emphatic individual and lent my ears to Ruchi’s full flow of
convincing arguments.
Ruchi’s Point of View: - Need a
credit card as it offers 5-10% on the purchases and the card is free
Rathin’s response: - You already own
a debit card which you can use. Despite the discounts, you will end up spending
much more than the budget decided. I tried reasoning it out that one will spend
more to buy the products which were not needed in the first place.
That set me thinking – how can one
reduce spending on unnecessary items.
Solution will be to go back to the roots – Spend in cash. The reader
will think that I am crazy to propagate cash economy in the jet and plastic
era!
Either debit card or a credit
card - If the amount straightaway goes through a bank transfer one doesn’t bother
too much. Just take an example – If I have Rs.30000/- in my account and I see a
UCB shirt worth 1500/-, I won’t think twice and immediately swipe my card. On other
hand, if I withdraw Rs. 5000/- for my personal monthly expenses every month
like pocket money and then see this shirt, chances are that I will surely think
twice or more.
Try this once.
For reducing your monthly expenditure,
withdraw Rs.10000/- (you can choose your limit – but try to keep it to the bare
minimum for expenses on fuel, grocery, internet, power, telephone, child
education, restaurants etc.) and only spend within this amount. Forget that you
have an ATM / debit card (rather just keep it away from you in a safe). You can’t
withdraw more than the initially withdrawn amount. So that will make you
evaluate your purchases before you pay for it finally. I believe, if you follow
this regularly, you will have a better control over the expenses. You will
score brownie points if you can save something from the withdrawn amount and
put it in the piggy bank like the old times when we were kids.
I gave this pitch to Ruchi. She might
implement it in the next financial year. You may also do so…Worth a try! However, I am not going to follow my own advice, as I am in the splurging mode!
