Seems simple enough, right? RIIIIGHT?
Unfortunately, for many of us it's not as simple as that. There are a lot of reasons why people live beyond--or, fine, maybe most of the time just a tad under--their means. Some simply have gotten so used to a particular lifestyle--condo living, morning grande lattes, daily 500-peso lunches--that when they do decide to cut back on spending, they have a difficult time giving up even the simple, useless stuff. While others have developed this certain sense of entitlement, that for one reason or another, they deserve whatever practical or emotional rewards spending may bestow upon them: "I worked so hard this past month, I think I'm going to treat myself to an LV handbag," or "It's been a long day at work, so I'm going to reward myself with a 1,500 peso dinner at this fancy-schmancy restaurant."
These people find it easier to justify buying stuff than the default option of staying put and not buying anything they don't really need. I have a Filipina friend here in Hong Kong who currently owns an iPod Touch, and iPhone 3Gs, and a Blackberry Torch--and she's been seriously contemplating getting an iPhone 4 or iPad for her birthday (happy birthday! ;)). On top of that, even if she's only been here for 16 months, she has already accumulated 20-plus pairs of shoes (that's like, close to all the pairs of shoes that I've owned in my lifetime), apart from the many more she has back in Manila. I've asked her questions several times about these purchases, just to have a better idea why anyone would want so much stuff. But no matter how she tried to explain that she needed some of these things (like, the Touch was for music, the iPhone was for her Philippine line, and the Blackberry was for her HK line) and she simply wanted the others, I still could not get it.
It's clear that the biggest challenge in "spending less money than you make" is finding ways to control or altogether avoid unnecessary and impulsive spending. Fortunately for my friend and the rest of us who easily succumb to the lure of everything shiny and new (that new MacBook Air looks mighty fine, by the way), researchers from the National University of Singapore and the University of Chicago's Booth School of Business found a simple way of improving a person's defenses against temptation. It seems that it may take something as simple as firming up your muscles--any muscle--to avoid immediate but temporary pleasures that run counter to the attainment of long-term goals. In simpler terms, the next time you come across an expensive gadget or trinket that you badly want but don't need and cannot afford, just clench your fist or firm up your bicep and you'll find it easier to walk away.