You have good intentions, but you love to shop. And, you always buy too much. What can you do to keep your finances in better order? Use these four tips to keep your spending in check.
Save First, Buy Second
One of the best ways to spend less is to trick yourself into thinking you have less money. Talk to your boss or HR department about setting up automatic withdrawals from your paycheck. You may be able to reroute money into a 401(k)-retirement plan, an HSA (Health Savings Account) or a savings account before it hits your checkbook. If you don’t see the money, you’ll be less tempted to spend it. Plus, as a bonus, saving money also boosts health and happiness.
Use Cash Instead of Credit
Swiping a credit card and worrying about it later is incredibly easy. But what if you had to drive to the ATM every time you wanted to buy something? And, then think about handing over those $20 bills one by one. You might think twice about that impulse purchase. Make buying more difficult by paying with cash whenever possible. What if you can’t resist the allure of plastic? Money-management expert Dave Ramsey advises, “dump those credit cards like your ninth-grade fling” and switch over to cash and a debit card only.
Apply a Buying Buffer Zone
Do you find yourself purchasing items you don’t need? Certified financial planner, Robert Pagliarini recommends creating a “buying buffer zone of at least 30 days between the moment you want to buy something (usually in the heat of the moment at the store) and when you buy it.” Pagliarini says, rather than “whipping out your credit card, whip out your camera.” Take a picture and post it on your Buyer Board. Write down the date, the price and why you want this item. You’ll be surprised at the number of things that no longer interest you after a month has passed.
This sounds obvious, but it’s much harder to buy things when you aren’t in a store. (By the way, online stores count too.) Try switching up your activities to break your shopping habit. For example, if you spend Saturday mornings surfing the Internet for bargains, go for a hike, hit the gym or volunteer at a local charity. Or, if you shop with friends every weekend, host a simple get-together at your place instead. Just be careful not to replace shopping with another high-cost activity like going out to an expensive restaurant. Your goal is to spend less not more.
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