Habits are easy to form, but difficult to change. Here, we’ll help you form healthier habits that tackle overspending.
Ever wondered why you keep spending money on things you don’t need? You’re not alone.
So many of us struggle with impulse buying, often triggered by our emotions, both happy and sad.
Predatory marketing doesn’t help, nor does going shopping without a budget in place or some sort of plan. As a result, it’s easy to find ourselves developing poor spending habits, which leaves us with little to spare at the end of the month.
Habits are easy to form, but often difficult to change. Your best bet is to form healthier habits. In this article, we’ll show you how.
1. Exercise your willpower
Exerting any level of self-control requires willpower. As an exercise, try to break one habit a day for a month. Force yourself to do something you don’t want to, even if it’s small.
If you always eat junk food, force yourself to eat a healthier option tonight, or if you rarely exercise, force yourself to go for a short run.
Over time, this should build your willpower, which you can use to control your spending, too.
2. Replace your bad habit with a good one
Enjoyable activities, like shopping, can elicit a primal response and lead your brain to release dopamine - an addictive and habit-inducing chemical.
Habits can be hard to break completely, so it’s worth creating a new, more positive, habit to replace it instead.
For example, next time you want to spend money on something frivolous, send it to a savings account instead. Over time, you might find you transform your compulsive spending into compulsive saving - and get the same thrill.
3. Take on a new money identity
Many of our habits form due to our own perception of our identity, and social media reinforces this.
If you are ‘the person who always wears something new’, then, no matter how hard you try to stop spending, you may find it difficult.
Instead, visualise who you want to be. Next time you’re going shopping with friends, visualise yourself being satisfied with what you already have, and stick to that.
4. Override short-term gains
One of the reasons we stick with our habits, even when we know they’re bad for us, is because they provide genuinely positive short-term gains.
Every time you get a takeaway, you remove the need to cook, which gives you more time to do the things you want. But it can get expensive if you do it all the time.
Try to flip the short-term benefits of overspending. Even though going out for dinner every weekend may feel great at the time, how does it leave you feeling in the long-term?
Try setting up a budget to see how much disposable income you actually have.
At the end of each month, add up how much you spent on things you didn’t need. Visualise what you could have done with that money if you had saved it, instead. Even just some of it.
Over time, the thought of overspending should become less attractive.
5. Create friction
Give yourself the space to think logically when you’re buying something by creating friction in your buying process.
At its core, if something is harder to do, you’re less likely to do it. Delete your auto-fill payment details on shopping sites and get rid of convenient mobile payment functions like Google Pay and Apple Pay.
Next time you go shopping, pick out the things you like, but don’t buy them immediately. Wait at least three days and then ask yourself if you still want them. Only then, go back to the shop. This works with online purchases too.
Increasing friction should help you to stop habitually spending money on frivolous items, which leads to feelings of remorse and an empty bank account.
Remember, spending habits are there to be challenged. With the right mindset and budgeting techniques, you can get back in control of your finances.
The information provided is financial guidance and should not be considered financial advice.
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