Sometimes the circumstances force us to start dealing with things in ways we are not used to and to try thinking differently. The current state of our economy is pushing everyone to become more aware about our spending habits. Particularly those bad spending habits that throw our monthly budgets off the cliff. Some of us indulge in grocery shopping, some in electronics and others in shoes. No matter what your interests are there’s always that one thing you can never get enough of. It’s probably that one specific problem that makes you lose charge of your spending finances.
By changing; at least one of these steps, you will help yourself take charge of your finances, and your bad spending habits will hopefully become a thing of the past.
1- Strict budget per month
Your first step should be to set yourself a monthly budget. Write down your budget somewhere where you can always see it – and make sure it’s a realistic budget. Your budget shouldn’t be more than you make per month and definitely not less than what you need to live comfortably. To help you stay even more organized, instead of setting an overall monthly budget, you can break it down into categories; grocery, bills, rent, entertainment…etc. This way you can keep track of exactly where your money goes and it’ll help you make further spending cuts.
How to do this? Writing down a budget and planning is relatively easy, the challenge arises when you are trying to stick to the budget! It may be challenging at first, but it is very important to follow the budget strictly if you want to see changes. It might be helpful to visualize why you want to set yourself a budget, you can be planning a trip or saving up for a car, this way you can always remember the reason you’re cutting back to help keep yourself motivated.
2- Preplan your week.
Most of our overspending comes from buying things we didn’t plan on. Whether it’s a birthday gift, an outfit for an event, groceries, or even eating out, when we don’t plan our finances we’re usually caught off guard with many money-sucking errands.
How to do this? Plan your week ahead, make a note of your weekly/monthly events, outings, meals, gifts…etc., in order to know in advance where your money will go, and always leave a little extra on the side incase of any unplanned days.
3- Avoid environments and habits that trigger your overspending
Instead of always going to that nice supermarket that has all the imported chocolates, try to shop local! Go to specialized shops to buy only what you need. Figure out which stores sell the items you buy most at the cheapest prices and shop there. That way, you’ll be spending less while still buying all the things you normally would.
How to do this? To help you prevent places that trigger your overspending, make a list of all the places you usually end up paying a lot in and absolutely avoid going there.
Stores are not the only things that trigger overspending, many people rely on debit and credit cards which make it harder to notice how much they’re actually spending. Using debit and credit cards voids people of the same feeling they get when paying in actual cash, so they end up paying more than they actually have to spend.
How to do this? Pay with Cash. Follow your budget and only take the amount of cash that you’ve allowed yourself to spend, this way no matter what happens you will not overspend or break the budget.
4- Let your friends and family help you
If you want to change a habit about yourself the best way to do it is to create a support group, to help each other out with changing your collective bad habit. The influence of the group will help you; even motivate you to change your habits. Involve your friends on your journey to change your spending habits, make a pact together, and help each other avoid places and habits that pull your dark-spending-side. That way when one of you overspends they’ll feel like they’re letting the whole group down, and it’s much easier to stop spending money on new things, when your friends and family aren’t spending as well.
How to do this? There are many ways to create this support group, it could be your family or friends that you see regularly, or you can create a group chat on Facebook or Whatsapp where you check up on each other and remind each other why you’re doing this!
5- Consignment Stores
A sway away from the traditional habits, you can still buy your goods just at a discounted price. For many individuals, cutting back on their favorite luxury goods is not an option. The idea of buying used goods and selling them has been around for along time, what’s changing now is that there is an actual proper market for this. The idea behind a consignment store is that it sells second-hand items at a lower price. You can also sell your goods to these stores and end up making money not just spending less. The biggest perk of shopping at consignment stores is that the quality of the merchandise is hand-picked, so you can guarantee that you won’t be getting someone’s old ripped handbag or broken laptop. This way you’ll still get to indulge while saving some money.
6- Save Money On energy bills
With the latest increase on electricity prices, most of our spending goes towards settling energy bills. This is one area where you can’t avoid spending, but you can make changes to help you lower your monthly bills and end up spending less and saving more.