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Sometimes it can seem like money just slips away from you. One day you’re riding high on the proceeds from a nice fat paycheck, and the next thing you know all but a few dollars are gone. So where did it all go? One of the biggest reasons behind this phenomenon is just how easy it can be to spend money without realizing it.
There’s nothing fundamentally wrong with being someone who makes impulse purchases, but if you find yourself with an empty bank account and questioning your behavior in retrospect, it may be worth looking into ways to change your relationship with money and learn the difference between your wants versus your needs.
This rule is good for purchases of all types, from small to large. The concept is simple - whenever you have the urge to buy something that is not on your shopping list, take fifteen minutes to think it over. If you’re in a store, walk away and come back to it after finishing your other shopping. This brief pause to cool down doesn’t cost you a thing, but it could end up saving you a bundle.
Waiting fifteen minutes allows the idea of buying whatever item you have your eye to be processed by a different part of your brain, moving it from the category of impulse reaction to deliberate choice. Taking a minute or two to mull over what you’re thinking of buying removes the emotional aspect of the behavior and allows you to make a more rational, calm and responsible decision.
The envelope system is one of the most popular strategies for budgeting and managing your expenses, and it’s actually quite brilliant in its simplicity. At the beginning of the month, you create a budget detailing how much money to allocate to each budgetary category (bills, food, entertainment, etc.). You then withdraw cash, placing the corresponding amounts in envelopes for each category, and that is all the money you can spend on that expense for the rest of the month.
How does this system help you with thinking before you spend? Well, what you’ll quickly realize is that you can’t overspend in any one category without having to take money from another, destabilizing the whole system. This forces you to truly consider the impact of each purchase within each category and whether it’s really worth sacrificing funds from another.
This is really the pinnacle of learning to control your spending and impulse purchasing habits. Mindfulness is actually a fundamentally simple concept and form of metacognition. So much of what we do every day is ruled by habit, instinct, and our “lizard brain.” The 15 minutes rule and envelope system both snap us out of these involuntary behaviors and force us to consciously think about what we’re doing.
Mindfulness is a way to skip over the first part of this equation and get right to the result. It works by taking a step back and asking yourself a simple question: why do I want the item I wish to purchase? Does it spring from an insecurity? A momentary weakness in willpower? A craving? By consciously examining your motivations and feelings behind your spending you can determine if your reason for buying something is valid.
So often we buy things we don’t really need or even want and spend money that we later wish we hadn’t. While it might seem exhausting to follow the techniques above instead of just going with what your gut says, in the long term not only will your wallet thank you, but you’ll also feel better about yourself and the value of your purchases.
If you're spending has left you needing money, a signature installment loan could be the first step towards a new way of viewing moneyand responsible spending. Because the payments are spread out over several months, it reinforces the necessity to budget, and for many consumers, these emergency loans offer the ability to consolidate their debts into one easy-to-manage payment. Sometimes, there’s nothing better than a fresh start to motivate you to think twice before repeating the same behaviors.