How can you be a smarter spender?

MANILA, Philippines – The older we get, the bigger our spending power is.

But having a bigger paycheck doesn’t mean you can go all out and buy everything you want. It’s the time when you should be more conscious of the purchases you make, particularly for major ones like a wedding, home renovation, your kids’ education – or else, you put yourself at risk of financial trouble.

Adults are expected to make better, smarter purchase decisions but sometimes, even they fall into the trap of making missteps that hurt their finances.

Avoid making expensive mistakes that could keep you up countless nights by following these tips.

Take your time

When it comes to big purchases, doing it impulsively and for shallow reasons obviously don’t cut it. Don’t be swayed by distractions like popularity of a brand, by the belief that the more expensive an item is, the better; or by thinking that someone else might get it before you can, among others.

Sleep on it. It’s an age-old piece of advice but it’s something people still tend to forget upon seeing something they really like. Give yourself 24 hours at the very least and use that time to compare prices and terms of payment, check reviews, consult with experts or at least someone you trust, and think for yourself before making a decision.

Learn to differentiate needs and wants 

Needs and wants aren’t the same – learn to tell the difference when you’re buying things. For example, you’re about to get a suitcase because you travel a lot. You might want and can afford a gorgeous one from a luxury brand, but there might be a just-as-sturdy one that could be worth half the price.

Or maybe you want a laptop but don’t need it at the moment because your existing desktop at home is working perfectly fine, you also have your own PC at work and you can access almost everything with your smartphone. When you buy a laptop and not utilize it as much, your investment will just sit idly, unused.

The key is to try to distinguish which purchases you can do away with and which you can’t live without, and those that you’ll actually maximize. 

Don’t be afraid to invest

In simple terms, an investment is “an asset or item that is purchased with the hope that it will generate income or will appreciate in the future.” Such investments include jewelry, real estate properties, works of art, and even vintage watches of certain brands and make, just to name a few. 

If you have the means to do so, don’t be afraid to make an investment or two. Make your money work for you so that you not only get to enjoy your purchase now, you could also benefit from it when its value increases in the future. 

Have a separate account for major purchases

Never make the mistake of dipping into your savings for major purchases. You’ll be better off getting a separate account dedicated especially for these.

Some banks like BDO offer financing assistance through an installment card*, which gives you access to cash and financial flexibility for your every need without putting a dent on your own savings.

(READ: How to fulfill your goals on schedule)

At one point, we’re all going to make a big purchase. And when you’re about to shell out thousands, even millions, of pesos, you can’t afford to make a big mistake.

Always err on the side of caution. Check all your options. Make a checklist of details like pros and cons, prices, specifications, terms of payment, and others, and always compare.

At the end of the day, your purchase should make you feel fulfilled, not leave you feeling regretful and empty. – Rappler.com

With information from Forbes, Money, and Investopedia.

*You can use a BDO Installment Card to avail cash or make retail purchases. It offers flexible payment terms and interest rates of as low as 0.75% until January 31, 2018 for accounts approved until November 30, 2017.

For more details about BDO Installment Card, click here.