How do you approach a big budget purchase?
I was after new garden furniture. I had previously bought a very inexpensive set up, which was enjoyable while it lasted. But the quality and longevity of it left something to be desired. It started to come apart and break, making it not only unsightly but also unpleasant to sit on. Bit by bit we started getting rid of pieces until we were left with only a table. Which was also coming apart, not to mention had a black glass top so could get very hot in the summer sun. In the end the set lasted two years, but as I hadn’t planned ahead, I was unable to replace it last summer which was a bit of a bummer.
Fast forward to now and I have done my research, saved my money and was able to buy larger, better quality, more durable garden furniture with great reviews that will (hopefully!) last for many years to come. Above all, it was exactly what I wanted.
It probably doesn’t hurt that I also bought a cover this time in the hopes of prolonging its lifespan…
So what did I consider when researching garden furniture?
First, I looked all over the internet and in shops to get a sense of what a realistic budget was. The cost of garden furniture can range from several hundred to several thousand. I knew what was realistic for me to spend and wanted to also be realistic with my expectations for what I would get at my price point.
Then, I decided what material I wanted the furniture to be made of. The previous set was fake rattan, which I did not want to buy again due to the potential for breakage, and its lack of long-term durability. Next was knowing how many seats I wanted it to have, both in terms of my ideal and what I could reasonably afford because, budget.
Finally, I looked into reputable brands and product reviews to ensure I was buying something user tested and well received. Not just something that was known because of brand recognition. All of these steps helped me narrow down my list of viable options.
Time to Buy
Once I set the details, I was not swayed by fancier brands or the trendy items. I kept my list in mind when I went out shopping. In the end, because I had the funds set aside, I was able to capitalise on a sale at B&Q. I ended up with a garden furniture set with more seats than I thought I could afford and for nearly £200 UNDER my budget. I also did not have to face the “am I only buying this because it’s on sale” feeling because I had my list and this furniture ticked all the boxes.
So after my experience, and after getting some input from the wider team here at Bigmores, we’ve put together some Top Tips for Big Purchases that might come in handy in your own life.
(not my actual garden furniture)
Top Tips for Making a Big Budget Purchase
Know What You Want and Need
It is (unsurprisingly) easy to be swayed by the trends. The Instagram Perfect Life has many of us thinking that aesthetics is the most important thing. But is it? A beautiful cream coloured sofa with perfectly quaffed throw pillows embroidered with delicate flowers might look nice, but is it the right choice for a house with children or a puppy?
Making a list of what you want and what you need, then looking at it again through a realistic lens of what your life is now can help you focus in on what is truly best for you.
Do the Research
If you don’t know what something is going to cost, you don’t know how much money you need to save. Whether it’s a downpayment for a car, the cost of a holiday, a pricy bit of furniture or an expensive gift for a loved one, you must have an idea of what the cost will be.
But research isn’t just about cost. It is also about knowing what you want and need and looking into items that fall in line with that. You might find something on sale that you feel is a good deal, but if it doesn’t align with what you want it can very well end up being a waste of money.
Work Backwards
Once you know the total, zero in on when you need to spend the money. Things like holidays often have an option to pay a deposit up front with the balance being due later. Figure out how much you need to pay, and when, then work backwards to today. Take the total amount and divide it by how many months till the payment is due.
Let’s look at an example:
Holiday must be paid by 1st August. Total cost is £1000.
Deposit of £100 is due when booking, which is done in February.
That gives you 5 months to save up the £900 balance. Meaning you need to put aside £180 each month from March – July.
Plan Ahead to Avoid Interest
Let’s look at the same holiday if it’s booked last minute and on a credit card. The average interest on a credit card in the UK is around 24%. If you put the entire £1000 on a credit card, you will end up paying an additional £240. And you might still be paying off that £1240 long after your holiday has ended.
Understand Ongoing Costs
A car is the perfect example to use with this one. Different cars come with different insurance costs, road tax, maintenance schedules and fees as well as varying costs for parts and service labour. You might be able to afford a nice car, but you must also be aware of what the ongoing costs will be and if you can also shoulder that load.
Be Ready for Delayed Gratification
In today’s world of On Demand everything, planning ahead for big purchases is as much a mental challenge as it is financial. We are so used to dopamine hits from immediacy that the more subtle flow of that valuable brain chemical from small, continuous wins is often under appreciated.
If you struggle having to wait to purchase what you want, consider putting in little moments where you either treat yourself or celebrate the progress you’re making. It make take bit of trial and error to figure out what gives you the buzz you need. Once you find it, you can use it anytime you need to delay gratification.
Know the True Value of the Item
This tip varies based on what you’re buying. For me and my garden furniture, the value is how much it is going to be used an enjoyed by family and friends. The barbeques we can have. The time I’ll spend sitting on it watching the kids play in the garden. The lazy Sunday afternoons when I want to read a book in the sunshine. Value is much more than a price tag.
Buy it Right, Buy it Once
Planning a big budget purchase using the top tips above might feel a bit counter to the way you think about your money. Especially given how used to immediacy we are. Yet if you take the time to research, save and think through exactly what you need and can afford, you can take a stressful purchase to something you feel good about.
Article by Jill Rensing
Financial Mindset Coach
Need help building your savings?
Whether it’s for an emergency fund, retirement or a big budget purchase if you’ve never been a saver, becoming one can be tricky. This is where financial mindset coaching can help. For more information, or to book a free discovery call, fill out the contact form below.
Healthcare Cash Plan: What They Are and Why They Work
Previous post