Budgeting, Delayed Gratification and Deprivation

SO, today, as I was thinking about what to write and looking into my reader, I noticed an article about budgeting myths over at Investopedia. This article goes over the basic point of budgeting (spending less than you make) and then launches into 10 budgeting myths. The #6 myth on the list really got my attention:

I don’t want to deprive myself

The article pointed out that, as long as you budget the money in and don’t go negative, then you don’t have to deprive yourself. (What is deprivation, anyway? Do you really need all that stuff?) The article sort of glossed over one of the main points, I think, of good personal finances: Delayed gratification.

Delayed gratification

In this advertisement saturated world where credit is easy, we are being taught that we can have whatever we want right now. There’s no point in waiting to buy something until you actually have the money. Why not just whip out the credit card and get what you want right now. This very mentality is why we’re in the current economic mess. We feel we are entitled to the bigger house, the tickets to the game, the new car or the fancy dinner. We don’t want to deprive ourselves of these pleasures, so we go ahead and get what we want right now on credit. (Without thinking about how we will pay for it later.)

Delayed gratification is the opposite mentality. In this mentality, you think about what you want, and make a plan to get it when you can actually afford it. It means that you may have to wait a few months to buy the latest game system or that you save up for that big night out on the town. My husband waited for the PS3 to come down in price before he bought one. When I go to BlogWorld, I’m hitting the town with a girlfriend who lives in Las Vegas. I’ve been saving up for this by foregoing my usual “fun” for a couple of months.

The point is that my husband and I aren’t depriving ourselves. We’re just waiting a little longer to get what we want. And that’s what budgeting is designed to do. Make you think about what you want and actually plan for it. You avoid debt this way — and all the interest charges and fees that come with debt.

Do you believe in delayed gratification? What are you saving up for?

image credit: sxc.hu