If you want to improve your finances, you might want to stop unnecessary spending as soon as possible. There are certain signs that your spending habits need improvement and impulsive purchases are one of them.
Admittedly, it is hard not to spend when you live in this country. Everywhere you turn, you are enticed to spend. The billboards give you hints of what to buy. Celebrities and known personalities are paid millions to promote products. Even buses and benches have ads on them hinting of products and services that you can purchase. Companies are spending loads of money just to encourage you to spend. Even the government is doing it. After all, the economy is 70% reliant on consumer spending. When consumers stop spending, that can lead to a huge problem for everyone. In fact, reports revealed that the US economy slowed during the first quarter of 2018 because consumer spending went down.
As much as possible, everyone wants to keep that from happening. But that does not mean you should be reckless about it. Having the economy reliant on how much you spend is not an excuse. You need to stop unnecessary spending. Because if you don’t, it can lead to debt. And if you accumulate a lot of debt, that can also be dangerous to the economy. That means you need to find a balance. You need to keep on spending but you need to do it wisely.
Tricks that will help you stop unnecessary spending
Fortunately, there are various ways for you to control your spending urges. Obviously, your spending habits will be hard to change. Habits come naturally to us and are usually something we love to do. So breaking the spending habits that you are used to doing might be tougher than you think.
This is probably why you need to resort to tricks so you can successfully stop unnecessary spending. Here are some of the options that you have.
Put windfall money into your savings account
We all love getting some windfall money. Whether it is a gift, a bonus, or something that you won, having that extra money feels really good. Since this is unexpected money, that means it is not reserved for any expense that is listed in your budget plan. You can spend it any way you want. This is where it gets hard. When you spend on something that is not really a part of your budget, that is unnecessary spending. If you want to stop this type of spending, you might want to use any unexpected money and put it in your savings. Or you can use it to pay off your high-interest debts. Just do not use it to fuel your impulsive buying habits.
Cook your meals at home
According to statistics, 7 out of 10 Americans say that food is their biggest impulsive expense. If it is considered as impulsive, it probably involves eating out. If you want to cut back on your food expenses, you need to start cooking your meals from scratch and you should do it at home. Some people say that they do not have enough time or they are too tired when they get home. Well, there are recipes that will teach you how to prepare meals ahead of time. You can spend a couple of hours each weekend preparing your meals for the rest of the week and storing it in the fridge. You can put them in microwavable containers or in a baking dish that you can easily heat when you get home from work. Not only will this be cheaper, it will also be healthier.
Always shop with a list
When you are in the grocery, it is very easy for you to get sidetracked and end up buying something that you do not need. If you want to stop unnecessary spending and lower your grocery bill, you need to always shop with a list. Before you head out, take note of your inventory at home and list the things that you need to buy – nothing more.
When you get to the store, you need to stick to this list and never get anything that is not on it. If you think you forgot to put something on the list, put that item back and complete your list first. If you still feel strongly about buying it, then go ahead. Sometimes, we only feel like we need to buy something because it is right in front of us. Or you can go as far as to go home and decide if you really want to buy it. If the answer is yes, then just include it in your list the next time you go on another shopping errand.
Use these tricks to help you stop spending your money on things that are not important. It is not just about lowering your expenses. When you are smart about your spending, you will realize how much extra money you really have. This is money that you can use to increase your savings or invest to give your personal net worth a boost.
Two strategies to improve your spending habits
While it is not impossible to stop unnecessary spending, it is also not something that happens overnight. If you really want to improve your spending habits you might want to consider either one of these strategies.
Set a realistic budget
If you do not have a budget, then you know why you are prone to unnecessary spending. An effective budget plan will help you make a conscious decision about where your income should go. You need to stop basing all of it on where you think it should go. You have to carefully analyze your finances and your lifestyle so you can determine if your money is helping you reach your goals. With a realistic budget plan that has the right information in it, you can start using your money with a purpose. That is one way to stop unnecessary spending. By making sure your every money you spent has a good reason behind it. That should be a great motivation for you to spend your money wisely.
The other strategy that you can use is to opt for cash for all your purchases. What is great about using cash is that you will never overspend on anything. This does not automatically mean you can stop unnecessary spending. It just means you are more likely to hold back on the purchases because holding physical money is really harder to part with. If you think that Americans are unable to use cash, you are mistaken. While the majority uses credit, that does not mean everyone has given up on cash. According to reports, 41% of adults still carry cash on a regular basis. You can follow this trend. Of course, you do not have to do it forever. You can still use credit – but only after you have improved your spending habits.
It is important for you to realize that changing your spending behavior will not be easy and you have to make sure that you can stay committed to it. The temptation to spend in this society is very strong. You have to keep yourself motivated. Not only that, you need to set clear goals that will help give your decisions some guidance and direction. Over time, if you are consistent about it, you should be able to stop unnecessary spending.