You know that feeling when you’re at the store, without a shopping list, and all the things just call at you. You’re wandering down the aisles, under the guise of “looking for a deal,” when all you’re doing is spending more money on things you don’t need.
Learning how to stop spending money is an absolute necessity if you are trying to get your finances in order. And you MUST get your spending under control if you’re trying to be financially free!
*Disclaimer: I am not a financial advisor and this advice is considered general in nature, for the purpose of entertainment.
I understand…shopping is fun. It’s therapeutic (more on that later) and gives you an instant boost of endorphins.
Until you get the bill. And realize you spent waaaay more that month than you thought. And you don’t even know what you spent it on!
I get it. I’ve been there. I still do it sometimes. I’m not perfect. But with consumer debt at an all time high ($14.9 Trillion!!), I think it’s time to try and curb our spending a bit.
Why You Can’t Stop Spending Money
Let’s talk a little bit about WHY we can’t stop spending money in the first place. Why do we buy things we don’t need?
Related: How to Stop Buying Stuff
You’re there in the store and you pass the displays and everything is just SO CUTE! I do this every time I’m in target. Especially during the holidays.
It’s incredibly tempting to buy all the things. And at a place like Target or Costco, or any other discount store, you think you’re getting such a deal.
And maybe you are, but ONLY if you need it. If you don’t need what you’re looking at, don’t buy it.
Temptation is one reason why consumer debt is at an all time high right now.
When you don’t track your spending, you have no idea what you’re buying. That $5 you spend here and there may not seem like it adds up to much, but it does.
Not budgeting is one of the main reasons people spend more than they should. When you don’t know how much you have to spend, how do you know when to stop?
This one has me written all over it. I’m an addict of many things, with shopping be one of them.
It’s a way to make me feel better when I’m stressed or sad. There is something about the act of shopping that is therapeutic.
But this is not healthy. And that “retail therapy” ends once you get that bill at the end of the month and realize you can’t pay for it.
Which leads us to the last reason…
Ease of Credit Card Use
It’s ultra easy to pull that card out of your wallet and swipe it. I have been in situations where I don’t even pay attention to the amount at the register.
I just swipe. With no idea what I just spent. And that’s dangerous.
Because it’s SO EASY. And it’s that way by design. The easier it is to use a credit card, the more likely you are to buy things. I mean, you can put your credit card info on your phone now and just use it from there.
It doesn’t get much easier than that as we all have our phones with us at all times.
How to Stop Spending Money
Now that we understand why we spend, let’s figure out how to stop spending money. It’s actually not hard, just takes some planning and a willingness to take the appropriate steps.
Understand Your Spending
Go back up and re-read “Why You can’t Stop Spending Money.” Sit for a moment and think about how you feel when you shop.
Are you spending out of necessity, as an emotional response to outside triggers, or do you just love stuff?
It’s important to understand why you are spending before you can start figuring out how to decrease it.
Create a Budget
You have heard me harp on and on about how important it is to create a budget. Whether you’re budgeting by paycheck or using the cash envelope system, having a budget is is the first step you MUST take to get control of your spending.
A budget is going to help you track your income and expenses. The first step to determine if you’re spending too much is to add up all your income, then add up all your expenses.
Subtract your expenses from your income. If it’s negative, you’ve got a problem and you have GOT to curb your spending or you’ll continue accumulating debt and never get ahead.
But even if it’s not negative, do you have enough left over to fund your 401K or IRA? Are you saving money in an emergency fund?
If you’re working on becoming financially free, investing 30-60% of your income is how you’re going to get there.
Creating a budget and sticking to that budget is the perfect start to learning how to stop spending SO MUCH MONEY.
You may want to check out some of these amazing books about budgeting.
Stop Eating Out
Yes, I said it. Eating out is a huge budget killer. I spend about $100/week on groceries for 2 of us and we eat great!
Eliminate eating out from your daily life and learn how to grocery shop on a budget. If the reason you eat out a lot is because of time, first take a look at some of these tips for organizing your life.
It saves me a TON of time every week by taking a couple hours on the weekend and planning/cooking my meals for the week.
And if you want some ultra, super delicious food, check out my food blog, Went Here 8 This. The recipes are easy and have an international flair.
Learn How to Say “No”
It’s ok to say no. It took me a long time to realize this in my life. I felt like I always had to say yes or I would disappoint people.
As I got older, I realized saying yes all the time was wearing me down. I was doing things I didn’t want to do.
Now I only say yes to what I really want (or can afford) to do, or things I thoroughly enjoy doing.
So…what that means to you is you need to start saying no. And sometimes that actually means saying no to something you want to do if it’s not in your budget.
This goes back to the importance of having a budget. I do recommend budgeting some money for fun, so you don’t feel deprived.
So when your bestie asks you to go to dinner at some swanky place, and you don’t have enough in your eating out budget to cover it (ahem…see above for eating out), recommend heading out to a taco shop or a couple slices and taking nice walk to catch up.
A walk is free.
Create Shopping Lists
This one is huge. I used to go grocery shopping to pick up a couple things, and come out with 3 bags of groceries. You do it too…I know you’re out there!
You need a plan. Write a list of everything you need then ONLY buy those things.
If you absolutely have to swing by the sales rack (you know, that old dented can section), go ahead and do it. But only buy something that you know you’re going to use in the next couple weeks.
Otherwise, leave it. I don’t care if it’s only $1, you don’t need it. We’re only buying what we need!
Pro-Tip: If you have created a meal plan, your shopping list will be much easier to create and stick to.
Good old temptation is the hardest thing to resist. Whenever I’m in Target I feel like I NEED all the things I walk by.
And don’t even get me started on the mall. All those beautiful designer clothes and shoes and bags…I love them.
But temptation just draws you in to make purchases you don’t need that only bring you joy temporarily. That Louis Vuitton bag may be so pretty, but after a month it’ll just be a bag you spent a fortune on.
Now if you’re ballin’ (you’re probably not reading this), sure, go ahead and buy it. But likely you’ll need to resist temptation and keep on walking.
I know it’s hard sometimes, especially when you’re an emotional shopper. But just envision how good financial freedom will be.
That’s the best way to resist temptation in my opinion. I just think of how happy I’ll be when I’m completely financially free.
For instance, if I had given in to all my temptations, I never would have been able to quit my job last month. Am I completely financially free?
Not quite yet. But another year of investing and growing my businesses, AND resisting those temptations, and I will be. Just think about that next time you’re at the mall.
Stop Using Your Credit Card
I’m actually a huge fan of using credit cards to collect points to I can use those points for travel…BUT if you’re having trouble getting control over your spending, you need to leave those cards at home.
Until you have developed a budget and know how much you can spend, you should be using your credit card on a very limited basis.
And if you do use a card, make sure you have the cash in the bank to cover the purchase you’re making. If you don’t have the cash, don’t make the purchase.
On that note, if you’ve got credit card debt from before you decided to take control, it’s imperative that you pay it off. I highly recommend paying it off while saving for your emergency fund at the same time. You CAN do both!
Creating short term financial goals, as well as long term financial goals, ties in with all of the above recommendations. When you have goals to stick to, you are much more likely to stay within your budget.
Every time you feel that temptation to buy those heels you don’t need, that boat you have no business buying, or that expensive dinner with a friend, remember what your goals are.
I promise, you’ll be much happier sticking with your goal than you will be with whatever thing you have spent money on.
Where to Go From Here
Ok, so now that you have learned how to stop spending money, what’s next?
Like I said above, if you want financial freedom, you should be saving 30-50% of your income. And that saving should be going directly towards assets that generate passive income (after you have funded your emergency fund – 6 months of living expenses).
Creating additional income is also going to help you get to financial freedom faster. You can start a business with little or no money!
These 10 income producing assets are assets you should definitely look to purchase with this new savings you have created.
Related: Passive vs. Nonpassive Income
And then from here keep sticking to your budget and saving every month until the income from your assets covers your daily expenses. Then you will be financially free.
Learning how to stop spending money is incredibly important if you want to get in control of your finances and obtain that financial freedom we talk so much about.
It doesn’t mean you can’t spend ANY money, it just means you shouldn’t spend money on things you don’t need if your goal is to become financially free. Learning how to control your spending is going to bring you a sense of accomplishment and make you feel so much better about your financial position.
Say goodbye to all that stress about money!!!
Do you feel like you’re spending too much? What, if any, steps have you taken to try and curb that spending? Comment below and let me know what your pain point are!
Hi I’m Ana. I’m all about trying to live the best life you can. This blog is all about working to become physically healthy, mentally healthy and financially free! There lots of DIY tips, personal finance tips and just general tips on how to live the best life.