Spending is a struggle for most people. You are not alone if you often spend too much on things you don’t need or if you wonder where all your money went at the end of the month. With online shopping especially, spending is easy. You can buy anything you want and have it shipped to you from anywhere in the world with the click of a button. It can be intoxicating.
If you want to avoid relying on your kids one day (or on payday loans, title loans, etc.) and working until you’re 85, you may need to rethink your spending habits and come up with a plan for spending less money. Saving isn’t as fun as spending, but it’s the only way to ensure that you have a secure future and that you can ultimately spend money on things that will really matter like your kids’ college education or a memory-making family trip. Here are some ideas that will help you spend less:
- Analyze your necessary expenses.
- Some other places you can look to cut back include your cell phone plan, your cable bill, and your food expenses. Get a phone plan with less data. Switch from cable to an online service. Eat out less and shop the grocery store with coupons and loyalty plan savings. These kinds of expenses are a necessary part of your budget, but almost all of them can be trimmed.
- Start with your energy use. Buy more efficient lightbulbs. Put your thermostat on a timer so the furnace or air conditioning slows down when you’re not at home. Wash your clothes in cold water instead of hot. Think about how much gas you use in the car. Could you walk or bike more often? Or maybe even carpool?
- You have bills you have to pay every month. You can’t avoid paying the rent, paying for utilities, buying groceries, or putting gas in the car. But, what you can do is look for savings in these areas. Just because you need them doesn’t mean you have to overpay for them or that you can’t shop around and find ways to get costs down.
- Make a monthly budget.
- Also include savings in your budget. A portion of every paycheck should go automatically into savings. How much you will apportion for savings depends on your unique situation, but even if it’s only ten dollars, it’s important to do. It will help you develop savings over time, and it automatically removes some of your paycheck that you might otherwise have spent on something you didn’t need.
- Create a budget that is in line with your financial goals for the future. Include all of your ordinary and necessary expenses and also include a little bit of incidental cash for spending that you might not be able to plan for. It’s important to set limits, but you don’t want to be too strict or you won’t stick with it.
- Once you have done the above and moderated your regular expenses, you can create a monthly budget. A budget is a great way to keep your spending on track because when you don’t pay attention to how much you’re spending, you are likely to let more money fly out of your hands. You indulge more without even realizing it.
- Convert unnecessary expenses into working hours.
- Whenever you want to buy something you don’t need and you are trying to decide if you should, convert the cost of it into working hours. Ask yourself, how many hours will I have to work just to buy this $200 purse or this $50 spa treatment? Knowing just how much effort you have to put into earning your special treats really puts them in perspective. Visualizing expenses as working hours could be enough to make you drop the item and walk on.
- When you are faced with buying something you don’t need, you have an important choice to make. Hopefully you have enough wiggle room in your budget to allow yourself the occasional frivolous spend, but if you struggle to cut back on impulse buys or expensive things you don’t need, a new strategy might help.
You have to spend your money, but if you are careful about how you do it, you can spend less without feeling the pain of cutting back. Shop around, use coupons, make a budget that matches your financial goals, and think carefully about what it means in working hours before you spend. Do these things and you will make spending less a new habit.