Do you spend too much? If so, you’re not alone. Almost half of Americans are currently spending all of – or more than – what they earn. It’s easy to do if your wages are low, and even if they’re not, the world is full of temptations. While some people are able to will themselves to spend less, this approach doesn’t work for everyone. If you’ve been struggling to change your habits, then what can you do? How can you put yourself back in control?
Analyze your spending
The first thing that you need to do is work out what you’re spending money on. Keep a spending diary for a month and note down every little thing, because the cents matter as much as the dollars. When you’ve written it down, you might be surprised by what it looks like. Often, overspending happens in little ways – it’s easy to tell yourself not to splash out on a new game or a new jacket, but it’s harder to keep track of little treats that you buy for yourself. You need a clear picture in order to figure out where you can cut back.
Think about what you really need to spend on. For most people, this means food, medicine, accommodation, fuel bills and taxes. It could also mean gas and any payments due on your car and phone or internet payments so that you can keep in touch with the world. Beyond that, what do you really need to spend on a day-to-day basis? Sometimes, you’ll need money to repair things that break. Sometimes, you’ll need new clothes or footwear. You can work out a budget for such things. After that, anything that’s left can go into paying off debt or accumulating savings, plus a bit of pocket money to enjoy if you can afford it.
Check your impulses
How often do you see something appealing and buy it straight away? This is a habit that you can start to break by staying away from temptation, avoiding recreational shopping trips and browsing online stores or auction sites. When you slip up, simply take a night to sleep on it and then decide in the morning whether or not what you’ve seen is really important to you. If it is, then don’t buy it straight away – first, do some targeted searching to see if you can find it at a lower price somewhere else.
Find free sources of fun
You don’t need to pay through the nose for entertainment. If you want to watch movies, then check out the “one month free” offers that many streaming sites have, and make sure that you’ve set yourself reminders to cancel before you start having to pay. If you want to play online lotto, then find a website where you can do so for free. Use YouTube and Spotify for free music, and check out the myriad free games that you can find online. Spend time with friends or family, online or off.
Find free stuff
If you’re struggling to afford things that you need for your home, then check out Freecycle – there are people there willing to give away all sorts of things, especially if you’re able to go and collect them. You can also try asking on social media to see if any of your friends have what you need. If you feel awkward about doing this, then think about what you have to give in return – if you don’t have many possessions, then you could lend your skills and your time, helping to watch children or do home repairs, for instance – something that may be worth a great deal to your friends.
Set yourself goals
For many people, buying something new is exciting – whatever it is, it feels like a reward. This can be addictive, however. If you find yourself in this situation, then set yourself new goals. You could plan to pay off a certain amount of debt by the end of each month, or put a certain amount of money into a long-term savings account. When you achieve this, you can enjoy the same feeling of achievement that you used to get from buying things. Watch the numbers month to month and set bigger targets so that you can observe your situation improving. You’ll feel amazing when you look back and see how well you’ve done.
It’s important to be realistic in your approach to all this. Don’t set targets that are too big, and don’t expect to get everything right as you work towards changing your habits. What really matters is that you keep making progress. As you do so, you’ll find that you no longer need to spend to get an emotional boost because you feel happier in yourself.