I’m sure by now we’ve all read an infinite number of articles about saving money. The standard cut your cable bill and stop eating out so f*cking much is still great advice, but what if that doesn’t work? The math is simple, but that doesn’t help the majority of us if personal finance is largely about behavior.
What can we do outside of self-flagellation and budgeting?
Make The Smallest, Easiest Changes First
This might seem counterintuitive, since the big, tough changes usually bring the biggest financial benefit. As I mentioned, behavior > math so I like to focus on the changes that are behaviorally the most efficient. By staying consistent and making small, incremental steps, the math will eventually follow!
We all have priorities in life, it’s just about managing them so that our top priorities have most of our focus. Make a list of your top 10 key splurges, in order of most to least important to you. Here are mine:
- an abundance of cell phone data
- delicious, chocolatey snacks
- delicious, non-chocolatey snacks
- event tickets
- video games
- board games
- fast food & restaurants
Check out the bottom of that list. This is where we start. I’m not saying you have to completely cut out any category, but you can certainly spend less on the lower tier without noticing it as much as the higher tier. If you’re spending the most money on some of the lowest priorities, this is also a great time to face that reality!
I could lower my cell phone bill and slip slowly into madness on my commute, but that would cause me a disproportional amount of pain to gain. Ditto to ditching unhealthy food, apparently.
On the other hand, I don’t really enjoy drinking more than one or two alcoholic beverages at a time because it pretty much makes me feel like garbage. I realized that I was usually drinking more because everyone else was, and not because I particularly liked it. I started having water instead or sipping one or two drinks, and my spending dropped with almost no effort. I actually increased my happiness by spending less in this case!
I also decided I wouldn’t purchase any clothing in 2017 (so far, so good!). By the time I made this decision, it was surprisingly easy. I had a capsule wardrobe that was working well for me, and I didn’t need anything. When I still found myself browsing clothing, I knew it was time to disrupt the habit. I was shopping out of impulse, not want or necessity. It was relatively painless to unsubscribe from the newsletters and stop browsing the shops, because buying clothing was already lower on the priority list.
This method works well because it increases your confidence with quick wins, and reinforces the idea that you are in control of your spending. Suddenly you discover that some of those items that you thought were essential were actually just habitual. Once you feel comfortable decreasing spending on the lower priorities, it will be easier to move on and evaluate your purchases in other categories.
Find A New Hobby
Boredom is a great way to spend money, speaking from personal experience. If you can build in productive ways to fill your time that remove the social spending cues and distract you from researching that next perfect purchase, you’ll be ahead of the curve.
Most people would classify Netflix as an inexpensive activity, but if all you’re watching are home improvement shows and dramas about flush money launderers or drug kingpins, you’re still constantly receiving cues about spending. I like to watch futuristic science fiction because at least then the things I want to purchase haven’t been invented yet.
The holy grail of hobbies is something that is inexpensive, engaging, and enjoyable. It’s all about finding something that fits this criteria for you.
Get New Friends, Or Convert Your Current Ones
Yes, seriously. I don’t mean completely ditch your friends, but it’s tough only being around people who are directly opposed to your goals. If you find yourself having to say no to spendy plans constantly it will be more difficult to get in the right headspace to succeed.
My friends know that I’m reducing my spending to pay down my student debt and have all been extremely supportive, but if yours aren’t maybe it’s time to focus on yourself for a while. Find friends who understand your situation and are working toward similar achievements, even if they don’t live close to you. I have a few long-distance friends who know about my financial independence journey (and are on their own!) and we send each other messages of encouragement almost every day.
Okay, you may want to continue seeing your best friends, but are there other detrimental relationships that you can give some more distance? If not, could you steer the conversations from spending to saving? When your co-workers talk about how they plan to spend their bonus, you could chime in that you made a contribution to your retirement account. You don’t need to push the financial independence path on anyone, because no one wants to be saved, but you can mention it casually and then change the subject to a neutral topic. If their wheels start spinning and they ask you about it later, you can dole out more information at their pace. You might even find a new financial independence friend!
Address Your Mental Health
I think this step can be one of the most important, especially for those of us who aren’t seeing progress using the conventional wisdom. If you find yourself setting reasonable goals and then regularly failing to achieve them because of overspending, there may be something deeper at play. Other signs of a negative relationship to spending include purchasing things you don’t need or didn’t plan to buy; shopping in response to emotions; experiencing remorse after a purchase; or trying to conceal your new items from friends or family.
Spending can stem from many areas such as attempting to cope with stress, trying to fill an emotional void, or seeking a dopamine rush. I know seeing a professional can be intimidating, but having a neutral, kind, empathic ear might make all of the difference. If you’re not at that place right now, the Recovering Shopaholic blog, while currently on hiatus, has some fantastic resources.
For a mental health action you can take right now, try meditating for a few minutes to clear your mind of the noise.
What are some unconventional tactics you use to save money?