9 Smart Tips to Stop Overspending and Save More Money
Even savvy shoppers can give in to impulse purchases from time to time. But regularly overspending can wreck your finances by keeping you in debt and preventing you from achieving essential goals like saving for emergencies and investing for retirement.
Instead of caving to impulse shopping, use these nine tips to resist poor spending habits and save more money to improve your financial life.
1. Use a waiting period rule.
Create a rule that before buying anything over a certain amount, such as $50 or $100, you’ll wait and think about it. For instance, waiting at least 24 hours to decide if something is a need or just an impulse allows you to reconsider it with a clear mind.
2. Calculate an item’s value in time.
Consider how long it would take to earn what an item costs before buying it. For example, if you make $25 an hour after taxes, buying a $250 pair of shoes costs 10 hours of work. Engaging the logical part of your brain can instantly change your mindset, so you think more rationally before giving in to an impulse purchase.
3. Try a no-spending challenge.
Set a personal challenge to cut all impulse spending over a period, such as a week, month, or longer. For instance, you might:
- Cook at home instead of ordering food or dining out.
- Not browse shopping apps for clothes, sporting goods, or housewares.
- Only buy essentials (such as groceries, housing, utilities, and insurance).
No-spend days can help you identify spending triggers, such as surfing the web or spending time with certain people. Put reminders in strategic places, such as on your wallet, phone, or credit cards, and if you slip up, just resume the challenge right away.
4. Unsubscribe from retail newsletters.
The next time you receive an email newsletter with a tempting promotion or sale, look for the unsubscribe link and break the cycle. Something you happen to see on sale that you don’t need doesn’t save money but hurts your finances. What’s out of sight is one less way to spend money compulsively.
5. Reevaluate what you already own.
If you’re a compulsive shopper, you probably already have a lot of stuff. Instead of buying something you probably don’t need, reevaluate what you already have. You might even reorganize belongings, such as clothes, shoes, and housewares, so it’s easy to see what you own.
6. Shop with a clear head.
According to Finder’s Consumer Confidence Index, 17% of Americans shop while under the influence, spending over $300 each. Take notice of when and why you make impulse purchases. Being hungry, tired, or tipsy when shopping can lead to bad decisions you later regret.
7. Never shop for entertainment.
If hitting the mall or main street shopping is hurting your finances, change your idea of entertainment. It’s better to avoid the temptation of your favorite stores in your leisure time. When you genuinely need something, shopping solo can be a more mindful experience that keeps you in control compared to shopping with friends or kids.
8. Plan your splurges.
If you’re prone to frequent impulse purchases, it may be challenging to eliminate them. Instead, permit yourself to make smaller purchases regularly. For instance, you might plan for an inexpensive item each month or a relatively expensive treat once a quarter. Budgeting for an impulse fund can give you a responsible outlet for spontaneous purchases.
9. Remember your goals.
The point of curbing impulse spending is to have enough to reach your most cherished financial goals. Jot down your goals on sticky notes and keep them visible on your refrigerator, computer, bathroom mirror, and credit cards so they say top-of-mind. That can be a powerful way to sidestep destructive financial behaviors and stay focused on what’s most important to you.
The best way to resist impulses is to put time between the impulse and action. So the more time you give yourself to settle down, remember your goals, and reconsider the purchase, the easier it is to resist.
