Five Ways to Change Your Spending Habits

Why does saving money feel like such a difficult thing to do? Every bit of professional advice you read about achieving financial freedom includes saving 4-9 months of your monthly salary to have on hand as a cushion for emergencies and difficult times, and yet, less tha 23% of the population has been able to achieve this goal. There are numerous, personal reasons for the inability to save money—underlying most of those reasons are fears. Oftentimes, we use fear as a motivator to begin a goal: Fear of failing health, of being laid off, of having to turn to others for help, or of the unknown future. The problem with that is fear may encourage you to start saving money; however, once you’ve got a good amount saved—more than you’ve been able to stock away in your savings account previously—you are no longer afraid. So fear, then, is no longer a motivator and you are more likely to tap into that savings account for non-emergencies. The best strategies for saving money is to have a positive, inspirational goal in mind—something you really want to strive toward. Maybe it’s taking a long-desired vacation to Fiji or Alaska or Japan. Perhaps it’s an item you’ve always wanted like a house or a luxury car. Or maybe security in hard times is motivation enough. When the target is something you truly value, you’re more likely to sustain energy and the motivation to keep moving toward your goal. When you know what’s important to you, you’re better able to focus and stay on track. Here are five great to start saving money: 1. Stop spending. Every time you turn on a television or radio, or even go online, you’re bombarded with advertising that is designed to do one thing: get you to part with your money. Don’t buy on impulse. Take time to decide whether or not having that cute $24 purse or $22 watch outweighs your goal to own your own car at the end of the year. 2. Clip coupons. There are dozens of coupon websites. Take advantage of them. Saving money on items like hand soap, groceries, tissues, etc. saves you mere pennies in the moment, but those little copper coins add up to real savings over time. Coupon-clipping is a discipline that pays in the end. So get your scissors out and start paying less for everyday items. 3. Skip the movies and play games at home. Just taking two children to the movies today can cost you $50—that’s $5 for their tickets, $20 for you and your spouse, and $20 worth of food purchased at the theatre. The cost doesn’t even include gas for the car. When you’re saving money, fifty dollars is the occasional treat, not a childhood rite of passage. Save that for the must-see children’s movie of the year, and opt to stay in most weekends playing a board or card game that’s fun for everyone. 4. Stop using credit cards. Credit card debt is at an all-time high. Yes, it’s convenient to purchase items on credit, but if you really want to pay the $33 sale price for that designer sweater use cash. By the time you pay off credit card debt, you will on average have paid 35% above the full price. That’s $116 for an $86 sweater. Not much of a bargain now, is it? Save your credit cards for purchases you know you’ll have to pay over time, like big ticket items you can’t do without (a refrigerator, a water heater, a dehumidifier, etc.). If you’re enrolled in a rewards program through a credit card, strive to keep purchases under control and pay your balance every month. That’s how you really benefit from those point programs. 5. Teach your child to identify birthdays with presence not presents. Children under the age of five don’t care whether or not they get twelve birthday gifts when the one present they do receive is having the people who love them gathered around to fuss and fawn over them. We teach our children to start valuing things instead of people by having them tear the wrappers off a dozen packages at the age of one when the paper is far more interesting than the actual gifts inside. Take time to re-evaluate the way you look at money. We’ve all developed habits from childhood about spending. Maybe you grew up with very little and are determined to avoid those feelings of inadequacy as an adult. Or maybe you got everything you ever wanted and don’t see why that ever has to end even though you and your spouse don’t make near the amount your parents made. Revisit your past. Know what’s been motivating you to spend money, and then decide whether instant gratification is more valuable than being able to achieve your future goals.