Good Spending Habits to Practice Today
Plenty of lip service is paid to bad spending habits that will sink your personal finances and plunge you into debt — but what do good spending habits look like? Contrary to popular belief, it is important to spend your money, but knowing the right ways to spend your money will keep you on the right path toward wealth. Here are some tips for developing good spending habits that will improve your life today and tomorrow:
Build a Budget and Stick to It
A budget is the most fundamental tool for good personal financial practices. Your budget helps you track spending, earnings, debts and more, providing you not only with a full picture of your personal finances but also a plan for how to keep your finances on the right path to accomplishing your goals.
However, more important than building a budget is following your budget. You should use a tool that you can check every day (or at least every week) to help guide your spending and saving toward success.
Have Good Reasons for Expenses
It isn’t hard to come up with good reasons for paying your rent or utilities, paying for health insurance or getting gas for your car. However, for most other expenses, you should be able to produce a genuine reason why you need to use your money. For instance, there isn’t a particularly good reason to order food from a restaurant when you can usually make a meal in your kitchen for a much lower cost. The same is true of things like clothing or tech: If your current stuff works fine, you probably don’t need to bother buying something new.
If you struggle to determine what constitutes a “good reason,” you might give yourself a mandatory waiting period before you make purchases — like one month — or you could…
Ask Someone to Keep You Accountable
It is useful to have an accountability buddy whenever you are doing anything difficult. Ideally, you should find someone who has similar struggles and goals, who will benefit from your accountability as you will benefit from theirs. It is especially useful if this person tends to spend money with you, like a shopping buddy or a drinking buddy. Conversely, you might want to be accountable to someone who already has good spending habits, who can tell you whether they would spend money in certain circumstances or not.
Research Purchases Before Buying
A good way to waste money is buying things that break quickly, only function on a temporary basis or otherwise aren’t adequate. Instead of impulsively buying something you think might suit your needs, you should always research your purchases to ensure you are getting the exact right product. Then, you won’t have to waste more money trying to find additional or alternate solutions.
Avoid Places Where You Can’t Control Yourself
Everyone has that one store where they can’t control themselves and end up spending way more than they anticipated. While some might advocate building up a greater tolerance to these impulses, a smarter approach for those just beginning to rein in their spending is to stop visiting that store for some time. Until you have a better sense of expenses that are worthwhile, you shouldn’t tempt yourself with your favorite shopping place. If you are able to stay away for a certain length of time — like six months — you might reward yourself with a mini shopping spree, as long as you can fit it in your budget.
Practice Gratitude for What You Have
If you appreciate what you have, you might be less interested in acquiring more stuff. There are a few philosophies you might look into to help you feel more contented with your current belongings, like minimalism or anti-consumerism. You might also try meditating when you feel the lust to buy things or envy of other people’s possessions. By getting in the habit of feeling grateful for the lifestyle you currently have, you might feel less driven to waste money on unnecessary purchases.
If you already know you have bad spending habits, you don’t need someone to point them out. Instead, you need to know what good spending habits look like. The sooner you eliminate wasteful spending and cultivate financially healthier ways of making purchases, the sooner you will feel comfortable and confident with your money.