What’s your spending diet?
Before I started this personal finance blog I was a really bad spender. I didn’t ever budget my money, well maybe just stating in my mind the essentials I need. But after that, I’ll do an entirely different thing. For instance, I’ll go to the store to buy that one item I need but I’ll end up filling my cart. I know you can relate somehow, I would be out of the store and be like, what the hell just happened? I would then go ahead and push the guilt thought away by convincing myself I’ll cover the extra money I spent somehow. But you know what? That money is gone, I won’t be covering it, I will be using some more and more money. This or related behavior is toxic to personal financial growth.
I am not saying you should not have some little fun with your money. There is a sensible limit to your spending in whatever financial level you are and you know it. You may avoid confronting your bad spending habits but it’s high time you start Looking At Your Money In The Eye. Your money shouldn’t be controlling you, you are the BOSS. To be clear I do not have a perfect spending diet but I have come a long way and so far have recovered quite a lot from bad spending habits. If you are not sure whether you are a bad spender you can check out How To Know You Are A Bad Spender. So I compiled some of the ways you can adjust to being a wise spender.I guess you want to get to it already so let me not waste your time.
1.Be Sincere With Yourself About Your Money
You may be seeing this as a simple thing you do but is it really? Most of us do not think honestly about our money. We do a lot of convincing when spending money like ”I can afford this”,”I’ll recover the extra money later somehow”,”I do need to buy that cute dress by this week”. Seriously? Why are you lying to yourself?
Scrutinize your income and weigh your decisions. How are your money decisions going to affect your personal capital? Can you afford this? Will you land in debt? Is that luxury worth your savings reduction? Being honest with your money will create awareness and with that, you can make room for change.
2.Is This What I Need Or What I Want
After setting a rule of being sincere with yourself about your money you will definitely be honest about what you need. It may be quite challenging separating needs from wants because you may have upgraded them to needs by now. I’ll simplify it for you. Needs are must-haves. Depending on your life and environment, you definitely know your must-haves. Needs should no way be sacrificed to acquire wants. We all know what happens when you sacrifice needs to satisfy a want. You eventually have to spend on the need so if you spent the rent money on that expensive ticket to the concert, you have to loan money to cover it. To be a wise spender, you have to avoid putting yourself in such a tight spot.
3.Set A Spending Limit And Stick To It
How can you know where to stop spending if you haven’t set a spending limit in the first place. Calculate your expenses, put up space for emergencies and set a sensible spending limit. This helps when you want to buy something you can do without, the spending limit advises you otherwise so you don’t buy it. A wise spender knows when to stop the buying and maintains the number 24/7.
And here goes the song you listen to everywhere. You are told to plan everything and stick to the plan. It’s hard at first but trying to enforce the discipline every day, planning will eventually get into your system. When you make that grocery list, stick to it no matter how tempting the snacks aisle looks. When you get out of the store you will be thanking yourself seeing your planned balance intact. Impulse buying is shattered by a plan and patience. When you feel like you need something convince yourself to buy it tomorrow and so on. If you don’t buy it by the third day the urge may eventually go away.
5.How Can I Cut Down These Expenses(My Saving Hacks)
It’s high time you think about ways you can cut down those expenses. You don’t have to run errands every day. Set a day to run errands and save on gas. If your expenses are going too high, it’s time to search on saving hacks and see what you can apply in your daily life.
A wise spender tries to cut down expenses. Don’t overdo it though, don’t turn saving hacks into a job:-).
6.Automate Your Savings Then Track The Rest Of Your Money Patterns
How much is my personal capital? How much is reasonable to save and invest? Where do I spend my money?…Have you ever asked yourself these questions? Automating your savings and knowing just the right amount to put in doesn’t have to be rocket science. Making the right risks is what matters. After saving you have to track your money patterns. Knowing where your money goes makes you acknowledge what makes you happy, discover mistakes and more importantly keeps you in charge. A wise spender saves and pays themselves first. A wise spender cares to know where and how their money is flowing.
Ready to be a wise spender?