1. Do your own budgeting
Financial advisors might help with financial planning, but there are still advantages when you regularly plan your budget on your own. Plus, if you are one of those whose part of problems is giving in to the temptation of shopping and spending, we strongly recommend that you really do this.
There are benefits to managing your budget on your own. For starters, it helps you prepare for unforeseen expenses and other emergencies. Also, when you budget your own money, you can keep track of your how much you are saving versus spending. It keeps you aware of what your money is going towards.
2. Determine the stress factors that cause you to binge-shop
When you go shopping more than you actually need, stop and check in with yourself to see if you are shopping out of a necessity or as a coping mechanism.
After all, shopping gives you an instant hit of endorphins, so you might be shopping because you want to feel happy, rather than because you need something. Once you know what pushes you to spend money, then you know when to watch out and exert extra effort to control yourself.
Try distracting yourself, and develop new habits or try out new hobbies that can help you to relieve some stress.
3. Start by paying your debts from smallest to largest
Some may think that this step is counter-intuitive, but hear us out first.
At first glance, it makes more sense to pay the biggest debts because these ones have the greatest impact on us, and they require much more time and investment to pay back.
But this form of thinking does not take into account an important aspect of saving, paying debts, and handling finances in general. In short, it ignores the psychological aspect of paying debts.
Why start with the smallest debts, a method also called “the snowball approach”? This is mainly because you are more likely to finish paying them off completely more easily and faster. And that matters more because it then gives you the motivation to pay off your other debts.
4. Develop shopping techniques
Whenever you feel the urge to spend, ask yourself these questions: Do you really need this or do you just want it? Of course, this is easier said than done, but the discipline comes with practice.
Doing this lets you understand how the brain works, and helps you overcome your impulse shopping urges.
Furthermore, did you know that stores and shopping malls have tactics of their own to make you spend more than you need? From attention-seeking colours to the strategic placement of their stores, you end up visiting more stores than you originally intended.
All this can be avoided if you learn to rise above their manipulative pratices. Start by cutting down on your window shopping, and avoid physically touching items that catch your attention. A psychological study shows that when you touch an item, you are more likely to buy it on a whim as you’ve unconsciously sparked a relationship or an attachment to said object.
It also helps to ask yourself “what am I grateful for?” whenever you feel like spending and shopping again. According to a research study from Northeastern University, people who wrote down what they were thankful for have shown more willpower and self-control in their shopping habits.
5. Organize your wardrobe
If you want to reprogram yourself to save more and spend less, you should start with a clean slate. List down all the things you own, organize them, and throw out those you don’t need. Essentially, you are hitting the ‘restart’ button on your brain.
This makes a lot more sense if you think about the benefits of cleaning and decluttering your closet. Firstly, you are able to see what you already have, so you can avoid buying repeated items. Secondly, you will also be able to take stock on the items that you’ve bought but never used.
It also helps to categorize your stuff into four main categories: Things you always need, sometimes need, things you want, and things that are clutter. Remember to try to be as honest as you can when you do this. It may be difficult, but you will have to say goodbye to some items, even you’re only hanging on to them out of sentimentality.
Once you are done with that, go back to your “Clutter pile”. Try to remember how much you’ve paid for these things, and you’ll realize the sheer cost of buying unnecessary items that could have been money saved.