The Secret to Making Tough Financial Decisions


We all know people who are great at getting things done. But whether they deliver at work, always find the time to fit in a workout, or make tons of time for family and friends, it all comes down to the same thing — priorities. Yup, you know where I’m going with this. I’m talking about money, because the way you handle it is a matter of priority, too.

How do I know this? Well, I happen to come from a very frugal family, so I have a behind-the-scenes look at what makes frugal minds tick. As a result, I can say with all confidence that making difficult (and often important) financial choices is a frame of mind that frugal people live day by day through all the little decisions they make. (See also: The Best-Kept Secret to Frugal Living)

Let me give you an example. It happened when I was about 10 years old, on one of the many shopping trips I took with my mom for new shoes. (What can I say? I went through a lot of sizes!) I’m a big shoe fanatic, so I still distinctly remember nearly every pair I ever picked out. One evening, my mom, my super-cool best friend, and I headed to the mall. We were on a mission, and we weren’t coming home until I had new running shoes.

At least that’s how I felt about it. I was — and still am — a very picky shoe shopper. These particular shoes had to be light, they had to be fast, and they had to be cushioned by as much air as money could buy. Most importantly, their appearance had to conform to all the delicate rules of style that would keep other kids from laughing at me. Needless to say, picking them out took quite some time; by the time I’d found the perfect pair, we had spent hours crossing the entire mall.

But I knew these were the shoes. They were silver with lilac accents, they had a respectable air-filled pod under the heel, and I had to have them. My mom checked the fit. She deemed the price acceptable. My best friend gave them a thumbs-up. I admired my new-sneakered feet. My mom paid the bill.

Then, we headed back across the mall to our car. I think now would be a good time to mention that we were shopping at West Edmonton Mall, which, at that time, was the largest mall in the world. (It’s since been surpassed by a handful of mega malls in Asia and the Middle East.) End to end, it’s several city blocks long. That is one long walk, but I didn’t mind — I was bouncing along with my best friend in my shiny brand-new running shoes.

On our way out of the mall, we crossed through a department store, passing the shoe section. And there were my shoes, on display. I was excited to see them...until I noticed that they were on sale — $5 cheaper than the ones I had on my feet.

“No big deal,” my best friend said.

“Yeah,” I said. “No big deal.”

I looked at my mom. She looked back at me. She was wrinkling up her nose the way she does when she’s trying to make a tough decision. In other words, it wasn’t looking good.

We both know the cool thing to do here would be to forget the cheaper shoes and go home. She knew that it was critically important to me that we do the cool thing. I think she probably even considered the implications of all this in terms of my 10-year-old ego.

We started walking again. Whew. But suddenly, her expression changed from anxious to agitated. I stopped. I stared her down. I silently begged her to keep walking. I could tell she was considering it, for my sake. Time stood still. I held my breath.

“I can’t,” she said. “Five dollars is still five dollars.”

I dropped my head in resignation. Yup. We were going bargain hunting. My super-cool best friend sighed. Or maybe I just imagined that she did. At any rate, we started a long, slow walk back to the other side of the mall, then waited while my mom argued with the salesperson about matching the other store’s price.

At the time, I found my mom’s dogged pursuit of five bucks deeply embarrassing. (But then at that age, I found almost anything my parents did deeply embarrassing.)

When I recently remembered this incident, though, it made me think. My mom could not — and I mean could not — pay the higher price.

We were not destitute, or even poor for that matter. That $5 was not life and death. This story doesn’t even end with a miraculous tale involving that $5 and the power of compound interest.

So here’s my point — my parents were committed to making the most of what they had. That sounds good, but in practice it is much less glamorous; it meant going to a lot of trouble to avoid spending an extra $5. Actually, it was so important to my mom, she literally couldn’t bring herself to do anything else.

That’s the thing about making good financial decisions. It doesn’t just happen once a month when you decide to put some money in a savings account. In fact, the most important decisions are the ones you make each and every day. Most of these little choices — like clipping coupons for your groceries, forgoing cable, or going the extra mile to save a few extra dollars — don’t seem like much. But they do add up, often in a big way.

Saving money, then, isn’t about grand gestures. It’s in the details — whether you buy that cup of premium coffee in the morning or make it at home; whether you eat out or stay in; whether you succumb to impulse buys or stick to your budget; whether you walk 24 blocks to save $5 or just let it go.

It’s really that simple.

Oh, and if staying out of debt and working toward a secure financial future aren’t good enough reasons to motivate you to be on your best financial behavior, here’s another one — you never know when your kids will be paying attention.

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Guest's picture

Absolutely LOVE this post! And I couldn't agree more. Great story, and great lesson! My mom would have done the same - except she probs would have made me run across the mall and she would pick me up in the car later. haha

It's the little choices we make time after time - like saving a few cents by buying generic versions of products, or taking the time to go to the gas station across the street for gas that's just slightly cheaper. It's getting water every time you go out to eat instead of a cocktail, and wearing that hand-me-down t-shirt instead of a fancy new one. It's the little things that make us who we are - for better or for worse. Rome wasn't built in a day, and neither is your financial status.

Tara Struyk's picture

"It's the little things that make us who we are - for better or for worse." Indeed. Thanks for the comment!

Guest's picture

Yep this is def. nail on the head...i keep telling myself and everyone who will listen just becos we have does not we should spend...everyone these days go shopping feeling absolutely we really need all that we buy...

Guest's picture

Running a successful business means having to make tough financial decisions. To make the important financial decisions that are necessary for your best chance at success.

Guest's picture

This is a great story to illustrate just how important every financial decision is. Not only may you be teaching someone else something valuable about money management as they watch you be responsible with your dollars, but the little things are what build up to become the big things. Grabbing coffee on the way to work rather than making it at home is one of the prime concrete examples. Being conscious of these "little" (yet big) decisions about money are what separate the thrifty and money-smart, from the frivolous and (inevitably) debt-ridden.

Kentin Waits's picture

Great advice -- saving money is all in the details. Everyone has a different way of doing it, but the key is staying on-track. :)