Can We Afford It? How to Make Confident Financial Decisions

“Can we afford it?” It’s a question we’ve all asked—whether it’s about a spontaneous weekend getaway, a major home renovation, or the life-altering decision to start a family. Money is at the heart of these big choices. But here’s the truth: the answer to “Can we afford it?” is rarely just about money.

In reality, affordability is about more than just what's sitting in your bank account or coming in with your next paycheck. It’s about aligning your money with your life—your values, your goals, and the future you want to build. So, how do you confidently answer this question without second-guessing yourself or stressing over whether you’re making the right decision? It starts with shifting the way you think about your finances.

Let’s dive into how you and your partner can approach these decisions with clarity, intention, and confidence, so you can move forward knowing that your money is working for you—not the other way around.

1. Redefining “Affordability” Beyond the Numbers

What does it really mean to "afford" something?

For us, the old way of deciding if we could afford something was simple: check the bank account balance. If there was enough money, we’d move forward. If not, we might consider how soon the next paycheck was coming. (Anyone else? 🙋‍♀️)

But this approach only scratched the surface. We might have technically had the funds, but what if that money was already earmarked for something more important—like long-term goals or values-based spending?

Redefining affordability means considering more than just the numbers. It’s about asking yourself: Is this purchase aligned with what I want most? Maybe you have enough in savings to buy a new car or put a down payment on a house—but which one brings you closer to the future you want? When you view affordability through the lens of your values and goals, you’ll sometimes find that even though you can afford something, it doesn’t mean you should.

2. Understanding Your Financial Picture

While numbers aren't everything, they do matter. Having a clear understanding of your financial picture is key to making confident decisions.

Start by tracking your spending. With so many small, day-to-day decisions, it’s easy to forget how much they add up. Once you know where your money is going, create a budget that reflects your values and goals.

A budget isn’t restrictive—it’s empowering. Think of it as a compass that guides you through these financial choices. For instance, my personal favorite daydream involves browsing Zillow and imagining home renovations. But our budget reminds me what it would actually take to move into a new house—higher mortgage payments, increased taxes, insurance, and renovation costs. It helps me see how that choice would impact our other priorities, like having ample time with our kids.

Our budget shows us what’s realistic and what sacrifices we’d need to make. More often than not, we decide staying put aligns better with our values right now.

3. The Trade-Offs: Making Conscious Choices

Every financial decision has a trade-off. When you choose to spend on one thing, you’re choosing to not spend on something else. That’s the nature of opportunity cost.

To make intentional choices, put pen to paper. Start by getting clear on your values and goals. When faced with a spending decision, consult this list: Does this purchase align with what’s most important to us? Is it a temporary desire or something that truly adds value to our lives?

For example, say there’s an opportunity to go on a vacation, but you’d have to delay paying off a credit card or skip contributing to your Roth IRA. It’s not an easy choice, but deliberately weighing these trade-offs gives you the clarity to make a confident decision.

4. Confidence in Saying “No”: Empowering Boundaries

The beauty of a budget is that it empowers you to say “no” without guilt. Rather than feeling deprived, you gain confidence by knowing your money is already working toward what you care about most.

I love dreaming about that bigger, fancier house, but my budget helps me pause. Our family’s priority is not more income but instead, ease. Buying a bigger house with a bigger mortgage would mean working more (i.e. less ease). Thanks to our budget, we can confidently say no—even when society encourages us to want the bigger, “better” option.

5. How Debt Plays Into the Equation

Debt complicates the “Can we afford it?” question. While debt lets you get what you want now, it limits your options later. When you carry debt, you’re paying for decisions made in the past, which restricts your future financial freedom.

If you’re considering a big purchase, like a vacation or home improvement, debt becomes part of the trade-offs you weigh. Without debt, the decision-making process is more straightforward because you aren’t tied to past obligations.

Aligning Spending with Your Values and Goals

Affordability isn’t just about today’s finances—it’s about making sure your spending today supports the life you want tomorrow. Whether your goals are financial freedom, more time with family, or reducing stress, your spending should reflect what’s most important to you.

I’m not going to stop browsing Zillow anytime soon, but I’m clear on what I value. That clarity makes it easier to decide whether a purchase aligns with our family’s priorities. The key to confidently answering “Can we afford it?” is having a clear financial picture, making conscious decisions, and ensuring your money aligns with your values.