When to Splurge, D&OC style

My friend contacted me the other day because she wanted me to "talk her down" from the ledge before purchasing these boots. You know the ledge I'm talking about. We've all been there, when we REALLY want something and we don't know if it's worth the leap. It got me thinking about splurges and when and if it's ok to indulge and when to know if you're ready. Regardless of your budget, I think a splurge every once in a while is ok and can be a great thing but i think being prepared and fully conscious of your splurging decisions is what makes or breaks a quality purchase.

Here are some questions I came up with to help myself decide when to throw down the money and when to refrain.
1. What's your debt looking like right now? Will this purchase add to your debt or are you able to pay cash? It's all about priorities.
2. Is the item you're looking to purchase worth the investment? Is it a trendier piece that could be found at a cheaper price? Is it timeless?
3. Are you willing to be patient to see if there's a sale? Is this a limited design or will it be around next year? Can you save for it?
4. Will you use it? I can't tell you how many times I've heard, "oh this is such a great sale, it's marked down from $500 to $250, I just don't know if I like it." If you're not SUPER excited about a potential purchase, you're probably not going to use it. Don't waste your money on something that doesn't make you jump up and down. Seriously.
5. When was your last splurge? If you find yourself splurging A LOT then you're probably not being as discerning as you should be. Can you set yourself up on a splurge schedule (i.e. one time a year, twice a year)? Living within your means takes a lot of thought so don't kid yourself.
6. What will your financial situation look like in the next couple of months? Are you traveling soon? Is your car up for maintenance? Are your pets healthy? If you are expecting an increase in your normal bills, now might not be the time to splurge.

This is only the beginning of the questions I normally ask myself and more often than not, I end up walking away, BUT when I do splurge, it feels oh so good because I don't feel guilty after.
Everyone splurges, including a frugal person like myself. Here are some items that I will splurge on one day, when the time is right.
It'll be years before I'm able to buy myself a Burberry Trench coat, but it's classic and will last a lifetime.
Burberry Washed Double Breasted Twill Raglan Trench Coat $995

via here

Dwell Studio bedding would be perfect in our bedroom and this particular style is masculine enough to appease B as well.
Dwell Studio Chinois Blue Draper Stripe Duvet Collection $29.70 - $286

via here

I know I haven't mentioned much in the way of wedding plans because we're taking it slow, but I do know that I want an awesome set of engagement photos. This Atlanta based photographer does amazing work, I'm just to chicken to ask about the price!

via W. Scott Chester
In case you're wondering, I didn't talk my friend away from the ledge. In fact, I told her to buy them. She works incredibly hard for her money (harder than anyone I know) and deserves a treat, plus the boots are freaking gorgeous.
So I'm curious, what questions do you ask yourself before splurging?

Finances for the weary

As I mentioned in my previous post, I attended a developmental training called "Surviving Tough Economic Times." I was worried the class wasn't going to be any good, but it was the BEST training I have ever been too (I work in a business and finance office for research so it's all about $$$ around here). I realized that I have a long way to go to get things straight with my finances, but there is hope! I'm going to share w/you some things I learned and I'll try to be as brief as possible but there was a lot of information. Some of this is common sense, but it's good to be reminded of these things (if you're in your teens or still living w/your parents take note, even though this may not apply to you, it will one day!):

• Pay your bills on time, EVERY time. The best way to ruin your credit score is to repeatedly turn in late payments.
• Openly communicate with your family (or significant others if you share expenses) about your financial situation. Don't depend on just ONE member of the family to take care of the finances. Get you children involved in these discussions (teach them good spending habits FIRST and you'll save them some big headaches later).
• Be HONEST (I have trouble w/this one) about your situation. Are you in debt? FACE IT. Do not ignore your debts b/c guess what? If you don't take control of your situation, your money is going to control you. If you're in BIG trouble, seek help.
  
• Keep TRACK of your money. Every bit of it, for a while, until you can come up w/a good spending plan or budget. I've done this before (I actually have an online service that does it for me) and it's really difficult. Stick to it though. If you don't know how you spent those $200 you thought you had, there's a problem.
• Re-evaluate your VALUES. Find out what's important for you to spend you money on. This is different for everyone. For me, clothing and decor is going to be higher up on my list than some other people. That's OK. If you KNOW where your money is going and you feel good about it than great! I was not ok w/ the money I was spending on cigarettes every month so... I QUIT. It was hard but I remind myself that saving $4 a day saves me $1,460 in 1 year. That's a vacation!
• Set up an emergency fund. I do not have one, but I'm going to work on it. Some of what's gotten me into trouble is not having a fund I can dip into when one of the dogs gets sick or my car breaks down. If I had an emergency fund, I wouldn't have to use my credit for these things.

I'm going to work really hard to get the ball rolling for better financial health. I've already taken one step: I called AT&T a few minutes ago and canceled the internet on my Blackberry (gasp!!). I don't really use it that much and it's costing me $30 a/mo which I'm going to start putting towards my debt. This blog isn't called "Down and Out" chic for nothing:) I'm going to give frequent updates on how I'm doing b/c I need some accountability.
There was a ton more that I learned, but I think that good for now. Tell me what you think. How do you save money? Is there something you can cut out that could make a difference in your finances? Is financial health important to you?