Slow Down the Velocity of Your Money and Slow Down Your Spending

According to Investopedia, the "Velocity of Money" is defined as -

The rate at which money is exchanged from one transaction to another, and how much a unit of currency is used in a given period of time. Velocity of money is usually measured as a ratio of GNP to a country's total supply of money. 

 

It's a term that I remember from Economics 101 -- a valuable course that continues to help me explain being perpetually broke.  While the velocity of money is an obscure term that economists use to measure how quickly money is being circulated in an economy and the health of an economy, I just think about slowing down the rate at which money leaves my personal bank account.

 

 Do we really have to spend our money so fast?  If you put off a purchase until tomorrow, then your money gets to stay in the bank for another day.  Tomorrow, you might not still want to make that purchase or an emergency might crop up and divert that money to a more important end.  My thought is that if you can keep postponing purchases, some of the money might not ever leave your account.  You might even save some money.

Every pay period, we pay our bills and try to live on the meager amount that is left.  Every day that money is in the account and is unspent is a day that we aren't broke.  Every day that we don't spend puts off the day that we have to rely on a credit card or a line of credit.

The moral of this story:  Don't buy today what you can buy tomorrow or next week or next month or never.