How to control spending habits? “A simple fact that is hard to learn is that the time to save money is when you have some .” -Joe Moore. It is best for one to learn about saving money and control their spending habits very early in life. This will help with better control of finances as they start to earn and become independent.
Easy access to money via credit is one of the main factors to spending more. To add to this, marketers and advertisers constantly attract customers via social media, email, and other means using sophisticated technologies. It can be easy to fall prey to unwanted or reckless spending. Impulse spending is another factor for buying stuff sporadically. Parents these days are quick to indulge kids with their exorbitant demands to make up perhaps for their lack of involvement and busy lives. There are some others who go on a buying spree to overcome depression, feel good emotionally, and end up with unwanted purchases. They usually are spending more than what they earn. Finally, they are likely to have what is called "buyer’s remorse".
“Too many people spend money they haven’t earned, to buy the things they don’t want, to impress people that they don’t like .” -Will Rogers
What happens when you spend more than you earn?
Sooner or later uncontrolled spending is bound to result in problems like huge credit card balances to be paid. The choice of what bills to pay each month and postponing the rest to later can become a norm. Living paycheck to paycheck with no cash at the end of the month is another outcome of overspending. This can also finally result in increased debts (click here) and being in a stressful situation.
“You must gain control over your money or the lack of it will forever control you.” – Dave Ramsey
Strategies on how to control spending habits?
To control spending habits and save money be it college funds, a new home, car, insurance, vacation, or emergency funds, some simple strategies that can be implemented are listed below. They may seem like nothing but can help little by little, rewarding in the long run.
Smart Grocery shopping
Always make a list of things to buy and stick to your list. Have a time limit to hang out in the shop. It is best to get in and get out. Avoid grocery shopping on an empty stomach. You may end up buying more than what you need. If having a credit card is your weakness, leave it at home and use cash. It can sometimes be psychologically difficult to part with cash as you count and give it away. Stay away from impulse purchasing things at the register. They are kept there to make you fall for it.
Convert the value of the purchase
This is a trick that I read about that can make one think about the money that they are about to spend. It's a great way to reflect whether the purchase is worth the effort and time required to earn it. Say if one earns about 50k which is about 22.6$ an hour approximately. If you were to make a purchase of a pair of shoes that costs 200$, that would be roughly about 9 hours of work. If this calculative strategy makes you have second thoughts, you may as well want to just let it go. To avoid impulse spending on any purchases that are high ticket items, another trick is to delay the purchase, wait for about a week and see if you really need it. You will be surprised it could have been just an urge at that point in time that no longer exists.
Keep a track of your monthly spending so you know where your expenses are high and where they can be lowered. There are many apps and free tools that can help you with these . Knowing is always better as this will help you think and make a conscious decision before making any purchases. One other way is to set aside some cash for each category that you spend on for a month. Once that is depleted, your quota for that month is done.
“It’s not your salary that makes you rich; it is your spending habits.” – Charles A. Jaffe
Reduce Miscellaneous Spend
Every day take out coffees, dining out very often may seem like nothing. But this can amount to a huge bill by the end of the month and can be avoided. This will not only help save money but also improve health. It is not a big deal to cook a simple and nutritious meal at home with minimal effort. Other ways to stop miscellaneous spending are to stop sporadic clothes shopping, cancel unused gym membership, unwanted credit cards, or have only those cards that have no annual fees or end-of-the-year gift card returns. Unsubscribe from shopping email lists that may entice you with their products. Avoid sale purchases even though they may sound like a great deal. It is better to purchase something only if you really need it and not because it is on sale. Delete any shopping apps on your device.
Have a partner
Have a well-wisher or a trusted source who will help you to be accountable. They can be your go-to person for your big purchases, one who will think rationally on your behalf and will not hesitate to say a no, if the purchase is not really necessary. This feedback can put some sense and clarity into an impulsive mind that was temporarily foggy. You will at least start asking yourself whether you really need the item to be purchased.
Learn to divert your mind
When the urge to shop arises just because of feeling low, try activities like a walk in a park, a hike on a trail, going on a bike ride, a get-together with friends, garden work, visit a place of worship. These activities may help divert your mind. You will feel happier, peaceful, and satisfied rather than have the temporary happiness and high derived from shopping. Spending money on satisfying experiences as opposed to material possessions leads to greater happiness. Having pre-defined rules and barriers before shopping can be helpful at times. You could make rules like cleaning your fridge, car or vacuuming your carpets, mowing your lawn, and the like. This may just help you divert your mind away from shopping and spending.
All the savings that you make even if little can help in the long run. Transfer a fixed amount to be saved from checking to savings immediately after you receive the paycheck. College savings funds, a certificate deposit are some other ways where you can save so the money is locked and not used up. In the long run, investing in rental properties or mutual funds which can make money for you is a good idea as well.
"Do not save what is left after spending, but spend what is left after saving." - Warren Buffett
Last but not the least, it is important to save money and not immerse yourself in debt. However, it is okay to also cut yourself some slack at times. You may have some things that you really wanted to purchase or spend on, your entire life and which you worked hard for. There’s a nice saying from an unknown source. I am stuck between “I need to save money” and “You live only once”.Ultimately each one is the best judge of their own financial situation. Knowing the fine balance on where to draw the line and control spending appropriately is wisdom.
Thank you for reading this post on how to control spending habits. If you have any tips that you would like to add or any comments, I would love to hear your feedback. Have a great day!
Spend what is left after saving. So very true! Credit cards are like a siren's song; so sweet and alluring and it takes discipline to control that habit.
Yes exactly right it takes a lot of discipline using a credit card.
I am terrible with savings although I do feel that I am getting better. As I get older I realise buying 'stuff' doesn't make you happy.
Totally agree realizing that the happiness from buying things is temporary is the key. It's true we all get better at saving as we get older and wiser 🙂 , the sooner we start the better. Thanks for stopping by.
I used to spend money a bit carelessly, but now, I don't buy something unless I need it.
Yes indeed buying something unless you really need it is a great way to hold off on unwanted expenses. It's a great tip to follow.
Great quotes and very useful tips. Thank you for sharing!
Glad you enjoyed this post . It's my pleasure to share .Thank you for stopping by!
I love your point about spending what you have after saving. I've just set up a regular transfer into my savings account to facilitate this.
That's a great way to save and one can also keep a check on the unwanted expenses as well. Thank you for stopping by!
Yemi Edwards (King)
I found an app to force me to save. I find I spend more money digitally than I do physically. Like TV subscriptions or audible etc. I'm hoping at the end of the term of saving I can have something physical to show for it lol.
That's great , these days there are wonderful apps that can help us save . Good luck with it and it is indeed a great step to get a hold of savings.
With costs of everything going up it's important to watch our spending. These are really helpful tips. Reducing miscellaneous spending is important.
I totally agree these reminders of savings are important so that we keep track of our expenses .As you righly say with increasing prices, it is important to watch the spending especially the miscellaneous ones.
This is an excellent post. I agree with you, parents should inculcate in their children the value of money, otherwise it impacts their whole life and they get into the habit of spending recklessly.
It is a great habit to learn about savings at a young age and surely it will help in the long run . Thank you for the comments!
Great tips! I do have issues with tracking where I spend however I find it not that big of an issue because I generally don’t spend much outside groceries and travel bookings. Having a more thoughtful partner helps a lot.
Glad these tips are useful . Having a partner to check and advise is a great help indeed.
These are really practical tips. I agree with you that it's important to track our money. It also aids me revise my budget if there is a need to. Will check some apps and free tools as I intend to do it digital next year instead of just writing it down.
Glad to hear that these tips are useful. The apps and tools will surely help .
Totally agree. When I started earning I had an urge to spend all of it. But then I realised how stupid I was being and started setting aside my savings (atleast 50% of my salary) in a separate account and then limit my spending to the amount left. Really helped me save.
I also only use my credit card for travel bookings or big purchases to avoid getting used to that credit lifestyle.