How to handle big money decisions

To invest or not to invest. To start a business or to not. To take the plunge and buy a home or rent a more expensive apartment... Sometimes (or maybe most of the time), financial decisions can feel BIG and overwhelming. Heart beating in your chest with the thought 'What if this is the wrong decision?'

Don’t worry, we’re here to help with your money management and those big financial decisions that can cause you financial stress. Here are our tips and tricks to manage them:

Tip 1: Create a pros and cons list of the financial options.

For example: if you’re considering renting out an apartment that’s more expensive than your current one, you might be wondering if the space would be worth it. 

More money
Potentially more stress
Moving costs

More space
Potentially more happiness from the space
Set up a home office

From both sides of the list decide on what top three things are most important to you and make a decision from there.

Tip 2: Look at the return on investment (ROI).

Let’s take the above example of moving into a more expensive apartment. If you don’t move into a more expensive apartment, could you save the difference in money (rent) and save up for a holiday or maybe your own home? Or another example, if you were going to purchase a large number of shares, what is the forecasted profit?

Couple calling transport company to move in new house

Tip 3: Think about the emotional impact of your decision.

Is the decision going to make you happier or more stressed? If it’s going to make you more stressed, are there other ways it could make you happier? For example, using the above rental example: More money might make you feel slightly more stressed, however, is more space/a better location/a home office going to counteract that financial stress?

Woman smiling arms raised up to blue sky, celebrating freedom. Positive human emotions, face expression feeling life perception success, peace of mind concept. Free Happy girl on beach enjoying nature

Tip 4: Don't make hasty decisions because of FOMO (Fear of Missing Out). 

Don’t make hasty decisions because of FOMO (Fear of Missing Out). It can sometimes feel like everyone around you has a better apartment, a better job, a better life and that we’re all playing catch up. But this isn’t always the case. If you’re making a financial decision because everyone else is doing it, you need to make sure it’s the right financial decision for you and go back to suggestion 2: Look at the return on investment.

If you’d like support on how to create a budget for those big financial decisions, check out our 4 Steps you need in your life for building a budget.

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