Can you count how many times you spent more money than you intended? The fact is we overspend for numerous reasons. Whatever the cause, you should be ready to take charge of your finances. Just take some minutes to pay attention to your spending patterns, you may find out the key. Below are 7 Pro Tips to Change Your Spending Habits.
1. Track Daily Expenses
To begin, enter the balance of your current bank account. Then, once you’ve spent the money, make a note of each transaction, noting the date, the category, and the location where the money was spent. After each transaction, make sure to check your account balance to ensure that you know exactly how much money is available in your account. Each category will be totaled at the end of the month, allowing you to view your actual expenses for the month and compare them to your planned expenses.
2. Use Savings Buckets
Saving Buckets are used to accumulate funds for one-time expenses (such as Christmas, car maintenance, vacation, etc.). Take your total planned amount for each category and divide it by the number of months until you need the money. Then save money each month until you reach your goal!
3. Automate Your Bills:
Automating your bills can not only save you time but also help you avoid future NSF fees (Non-sufficient funds – the fee charged when a check is presented but cannot be covered by the balance in the account). Set up bill pay for any recurring fixed expenses (mortgage, insurance, auto loans, etc.) in the account where your bills are paid. Now set up bill pay on the service providers’ websites for power, water, cell phone, cable, internet, etc. Make sure you have enough money in your account to pay these invoices on the scheduled day.
4. Understand Your Spending Triggers:
Do you know that our spending patterns are influenced by emotional and psychological triggers? By eliminating those triggers, you reduce the temptation and chance to overspend.
- Time: Do you feel more energized at particular times of the day? To make wiser spending decision, shop when you have more energy and less stress.
- Environment: Are there specific environments that make you want to spend or feel forced to spend? You’re more eager to spend impulsively at craft exhibits, shopping malls, house shows, and even on vacation. So avoid such places or only take a few coins with you to avoid temptation.
- Mood: Moods and emotions can influence our energy levels, making us more prone to impulse purchases. Taking a walk or exercising instead of going to the mall will do wonders for your mood.
- Peer pressure: Do you tend to overspend while you’re out with your friends? If you can’t afford to eat, shop, or vacation like your buddies, it’s alright to say no.
5. Avoid Shopping Traps:
- Go shopping with shopping list:
Go around the house and make a list of what you need to buy. Take the shopping list with you when you leave the house. Just follow the list, you can simply avoid impulse purchases this way. Simply remind yourself that you cannot purchase anything that is not on the list. If you see something that catches your attention but isn’t in your budget or on your shopping list, leave it and go for a 30-minute walk.
- Unsubcribe from retailer emails:
Notice how our spending habits are tied closely to what we see on social media, mass media, and emails. The more we see a beauty product, handbag, or pair of shoes, the more we want it. By not seeing these things, we are more likely to forget about them and not make a purchase, which is excellent for our budget. “Out of sight, out of mind” is surely true.
So, unsubscribe from any emails that may tempt you to spend. You’ll thank yourself afterward!
6. Make Gift Planner
Make a list of everyone for whom you will be purchasing gifts, along with a budgeted amount and a gift suggestion. When you’ve finished shopping for the gift, mark it off your list and write down the exact amount you spent. Make two copies: one for birthdays and another for holidays.
7. Make Party Expenses Planner
Establish a budget for your event, taking into consideration food, decoration, stationery, and other expenses. Then keep track of your expenditures in order to stay on target! Perfect for throwing a party or hosting a holiday get-together.
