Published initially on Relish Growth.
This post will share six ways to curb impulsive spending habits that never allow you to save.
I like to think that I have my spending habits in control.
Even though lately I’ve been going out of hand.
But that is why I have a side hustle to fund and justify my spending.
I also always buy stuff I can list on eBay for extra cash.
Sometimes, I get lucky and make all the money back for myself; I know how to manage my spending habits.
Some people might not be so fortunate.
They just don’t understand why they’re always broke and have to live from paycheck to paycheck.
If you struggle with sticking to your budget consistently, this post is for you.
I’m not a personal finance guru or anything.
I’m a regular millennial woman who prefers to have her finances in order.
Instead of waiting for someone to give me money to fund my lifestyle, I make my own money and live on my own terms.
I also realized that I love to spend money on skincare products, so I have an eBay store where I buy and resell for a profit.
There are certain things I’ve put in place to ensure that there’s no room for impulsive spending.
I’m not perfect, as I sometimes go out of my budget, but that only happens when there’s room for it.
So, without further ado, let’s get into some tips that have worked for me.
Here Are Six Ways To Control Impulsive Spending & Keep You In Check.
In no particular order;
Max out your employer’s pension contribution.
One of the ways I’ve realized that helps me control my spending is the absence of cash.
You’ll be forced to manage what you have and live below your means when you have little money.
This is why it is so important to save as much of your income as possible.
A perfect way to do this is by increasing your pension contribution.
Most companies have employees contributing the lowest percentage, so it doesn’t significantly affect their take-home pay.
You don’t know that you can increase your pension contribution to match the highest percentage your employer provides.
My former employer allowed us to contribute up to 8%, with them matching it with 12%.
So, you have 20% going into your pension pot every month.
Aside from being a great way to save for retirement, it also helps you limit the cash you have on hand, especially if you have an impulsive spending habit.
Have separate bank accounts for income, bills and expenses.
I can’t believe it took me this long to separate my bank accounts.
I guess I overestimated my determination.
While I never defaulted on my bills as I have them all automated, seeing that money regularly gave me the false impression that I had extra money.
Whenever I was tempted to dip into the money for my bills, I had to do a mental calculation to figure out how I would replace it.
Plus, it didn’t help that I was paid weekly.
But a few months ago, I decided to make changes by splitting my income into three different accounts. Now I have my:
- Income account where my salary comes in.
- Bills account for standing orders and direct debit bill payments.
- Expense/spending accounts for groceries, transportation, and other miscellaneous spending.
Trust me, this single move has been a game-changer for my finances.
I will not forget my business account for all my side hustle income.
Allocate spending money for yourself.
One of my favourite hacks to manage my spending habits is by allocating spending money to myself.
I look at how much I spend on average on miscellaneous/self-care stuff and then just include a realistic figure in my budget.
I create a list whenever I want to buy something I’ll need to budget for.
This gives me an idea of how I’ll need to spend. If that amount is not available immediately, I save towards it.
In any way, I always make sure I splurge on myself a bit.
What’s the point of working and being unable to afford what I like?
While sticking to your budget is excellent, give yourself some leeway by setting aside some spending money.
It’s a great way to reward yourself for a job well done.
Track your spending.
Having a separate account for expenses helps put many things into perspective.
Sometimes, you might not know your lousy spending habits until a considerable figure glares at you.
Sometimes, that is enough to get you to review where your money is going compared to where it should have gone.
If you had the plan to purchase something that requires saving but couldn’t, tracking your spending will reveal all the areas where your money went and help you make corrections.
Delete shopping apps from your phone.
One of my favourite pastimes is scrolling through shopping apps and saving stuff on my wishlist.
On the one hand, it saves me so much time when I need to shop as I pick what to buy from my wishlist.
On the other hand, the temptation to buy during sales and discounts can be very high.
It got out of control at some point, and I had to delete all my apps and restrict my shopping to my laptop.
It helped a bit, even though I have a bunch of tabs open right now.
But this means that I can quickly shut my laptop and sleep over it whenever I have the temptation.
Often, the temptation to shop is gone when I wake up.
So, if you struggle with impulsive spending, try deleting the shopping apps on your phone and see how it goes.
Not just limited to shopping. If you have any apps that encourage you to spend, try deleting them from your phone.
For me, it is also food delivery apps. I had to delete them because my spending was getting out of control.
Trust me, it worked.
Now, I only buy takeout maybe once a month.
Sometimes, I even go months without placing an order. I just make sure my fridge is stocked with enough food and snacks.
Have a significant saving goal.
At different points in my life, I’ve realized that having something to save up for reduces my chances of impulsive spending.
Whether it’s my next vacation or rental property, having a goal to save towards has helped me tremendously.
How else could I start a business, save my profit and move abroad to create a new life at age 25?
If you’re struggling to achieve goals that require money, maybe review your spending habits and start saving towards that goal.
Finally,
Yes, retail therapy is excellent, but whether you like it or not, impulsive spending is a habit. If you want to be serious about your personal finances, you must keep that habit in check as fast as possible.
Be reasonable, give yourself time to adjust, and you’ll get results.
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