At various points, we’ve all tried to stop spending money on things we don’t need.
You start off on payday with the best intentions, only to find yourself wondering where the last check went.
In this digital era, ads are EVERYWHERE and that makes it hard to stop spending money on things you don’t need.
Not to mention the times when the quick grocery store trip for a few items turns into more than $100 worth of purchases.
But just because something is hard, doesn’t mean it’s impossible. You can definitely learn how to stop spending money on things you don’t need.
Let’s walk through some of the reasons why you’re overspending and what you can do do about it.
Learn Your Spending Triggers
In order to stop spending money, you need to begin analyzing why you spend money.
Maybe every time you have a long day at work you order takeout or delivery for dinner.
Or every time you receive good news you get this sudden urge to splurge at Target.
In these instances, you’re being ruled by your spending triggers.
Spending triggers are events that get you to spend your hard-earned money and they’re different for each of us.
Some of us spend money when we’re sad, while others spend money when we’re happy or bored.
Recognizing your spending triggers can go a long way towards changing your spending habits.
An effective way to diminish the power of spending triggers is to do a spending journal for a month or two.
If you make an impulse purchase, go to your notes app and jot down things like how you felt, the time of day, and even the person you were with.
Do this long enough and you’ll start to spot your spending triggers as they happen and adapt your behavior fairly quickly.
Set Clear Money Goals
In order to stop spending money on unnecessary things, you need clear money goals.
Goals are dreams with an action plan and a deadline. Click To TweetI want to pay off my student loans is a dream.
I plan to use the debt snowball method to eliminate my student loans by next summer is a goal.
Goals create a clear purpose for your money and clarity of purpose creates clarity of priorities.
You should always have some smaller, short term goals you’re shooting for like saving for a vacation, and you should also have some larger, long-term goals like retiring at 45 with $1,000,000.
Take some time to sit down and come up with 2-3 short and long-term money goals for your household.
Follow A Unique Spending Plan
Once you have your money goals, it’s time to create a spending plan around those goals.
Creating a spending plan doesn’t have to be difficult or even time-consuming. A spending plan is just you telling your money where to go each month.
To create your first spending plan, simply list your projected income at the top of a piece of paper.
Once you’ve done this, go through and subtract all of your monthly expenses one by one in order of priority.
For example, let’s say you anticipate earning $2,500 this month. You’d write down $2,500 at the top of the page.
Next, you would list your most essential expenses like tithing, saving/investing, housing, cars, food, etc, and subtract the totals from the $2,500.
Once you’re done with the essentials, move on to any discretionary spending and start to subtract those totals from what’s left after your essential spending.
Once the $2,500 is down to zero, you’re done spending for the month.
You’ll need to create a spending plan that’s unique to each month because each month has different expenses.
For example, your spending plan with Christmas spending in December will look a little different than your spending plan in January.
As you can see, a spending plan isn’t about restricting your life or limiting your fun.
Creating and living on a spending plan is about making sure you stay in complete control over your money which will help curb any over-spending.
Remember The Consequences
Here’s a hard pill to swallow:
The only money you should spend is money that's been deposited into your bank account. Click To TweetYou may be asking “How does that help me stop spending money”.
Well because the money you’ve earned is a set amount.
Because there’s a limit to what you should spend when you say yes to one purchase, you’re saying no to another.
When you spend your money on a new pair of shoes, you can’t spend that money on the trip to the Carribean.
When you finance a new car and create a monthly payment for yourself, you can’t use that money to invest for your retirement.
When you say yes to one purchase, you’re simultaneously saying no to a different and sometimes better use of that money.
So before you spend money on one thing, ask yourself what you’re saying no to.
Your spending choices have consequence and in order to stop spending money you have to be aware of them.
Setup Automatic Transfers
One of the best ways to stop spending money is to set up an automatic transfer system.
Chances are, your paychecks are already being directly deposited into your bank account.
From there, it’s simply a matter of moving your money around on payday in accordance with your money goals.
For example, my wife and I scheduled automatic transfers from our checking account to our brokerage accounts to happen every payday.
We also have automatic transfers set up to our high-yield savings account that holds our sinking funds.
In addition to that, all of our bills are automatically paid on their due date and those due dates have been closely aligned with our direct deposit days.
As you can see, we have completely removed ourselves from our money management process. Setting up automatic transfers ensures that we’re making progress towards our money goals before we ever have a chance to spend our money on things we don’t need.
If you’re struggling to stop spending money, find a way to automate your finances so the priorities are always handled first.
The best part is when there’s money left in our account, we both know we get to have some guilt-free fun.
Implement The 48-Hour Rule
Chances are you’ve spent money on something only to be left wondering why you bought it just a few days later.
Buyer’s remorse is common when you spend money you don’t have on things you don’t need.
One way to curb this feeling is to implement a 48-hour spending rule.
When I want to make a purchase that isn’t included in my spending plan, I take 48 hours to think it over.
More often than not, I end up forgetting about the item- which helps me stay within my spending plan.
However, there are times when I really want to buy something and I just can’t shake the feeling.
In those instances, taking 48 hours to think it over allows me to re-evaluate my monthly spending plan and determine where the money will come from.
If I can’t work the purchase into my budget for the current month, then I will find a way to either save for it over time or slide it into next month’s spending plan.
Just a reminder: the goal shouldn’t be to never spend money. The goal should be to become a more mindful spender.
Use The Cash Envelope Method
Do you struggle with specific budget categories like restaurant spending or shopping?
(Hello Chick-Fil-A Spicy Chicken Sandwich after a Target run)
One method to help you stop spending money in certain categories is cash envelope budgeting.
With cash envelope budgeting, you first withdraw the cash you’ve allotted for that category in your spending plan.
Once you’ve withdrawn the cash for that category, you can only spend that cash. Once the cash is gone, the spending is done.
For example, let’s say you give yourself permission to spend $150 at restaurants this month.
You would withdraw $150 from your bank account on the first of the month (or payday if that’s how you budget) and stuff it in an envelope marked “Restaurants”.
Any time you spend money at a restaurant, you only use money from the cash in that specific category to cover the bill.
When the $150 is gone, the restaurant spending is done until it’s time to replenish the envelope.
As you can see, cash envelopes are a fantastic way to stop spending money in specific categories.
This method is for you if you struggle with one or two very specific categories in your spending plan.
Create A Weekly Meal Plan (That Makes Sense)
The first month my wife and I ever made a spending plan, we realized that we were spending more on food than we were spending on rent.
This was surprising to us because we didn’t go to a lot of big, fancy restaurants fairly often.
However, being on a first-name basis with the DoorDash delivery drivers in your area while also going to lunch with co-workers regularly probably means you’re spending too much money.
The average American household spends over $3,000 per year just on dining out.
These days my wife and I create a weekly meal plan that makes sense for our family.
We know we don’t want to cook every day, so we make a meal plan that makes sense.
On days where we know we will be working late, we plan to make a meal big enough to have leftovers the day before.
We also schedule 1 meal out from a restaurant each week and keep quick meals like frozen pizzas on hand for those days we just don’t want to cook anything.
Also, if we know we want to eat out a few times in a given week, we will lower our grocery spending for that week.
If food spending is an area of struggle for you, sit down at the beginning of the week and map out a plan that makes sense.
Calculate Costs In Time
Spending money has never been easier.
These days we have a number of online retailers like Amazon and Walmart competing for our dollars.
Advertisers spend premium dollars to remind you of your search history as you browse social media while offering one-click purchasing.
However, if you want to stop spending money on things you don’t need, one of the most effective things you can do is convert the price of items into the number of days or hours worked it would take to pay for the item.
For example, let’s say you want to buy a pair of shoes for $75.
If your hourly pay is $15, it would take 5 hours of work to pay for that one pair of shoes. That’s almost 1 full shift of work.
At that point, you’d have to ask yourself if a pair of shoes is worth 5 hours of your life.
You can even use an online tool called Time Well Spent. It’s a plugin for Google Chrome and it automatically converts prices in your browser into the amount of time you need to work to cover the cost.
We all say time is the most valuable resource in the world. Let’s start managing our money like that’s true.
Grow Comfortable Saying No
Back when my wife and I were paying off $61,000 worth of debt, we had to say no to a lot of things.
We didn’t just have to say no to our own desires either.
In order to stop spending money, we had to say no to friends who invited us to dinner, family members who wanted us to travel, and various other people in various scenarios.
You’re going to have the master the art of using the word no if you want to get your spending under control as well.
One way to do this is to redirect to free or less expensive alternatives.
So instead of always going out for dinner, suggest a potluck and game night at your house.
It’s also important to let your friends and family know that you’re on a financial wellness journey so that feelings and relationships aren’t hurt as you decline invitations.
You may need to remind yourself and them that you’re not saying no to them personally, and that what you’re actually saying no to is a lifestyle that keeps you from your goals and dreams.
It’s very common for you to have the kinds of conversations and begin to see those very same folks begin to reach out for money advice- which leads me to my next point.
Find An Accountability Partner
There’s a popular quote that says you’re the average of the 5 people you hang around the most.
I believe that’s true to an extent.
If you’re always hanging around people that spend money recklessly, chances are you’ll spend money recklessly- even if it’s less money than those in your circle spend.
With that said, you should find a tribe of people that will keep you accountable while you try to stop spending money.
You need to be able to say “I just saw this shirt that I really love but I need to save money. Please talk me off the ledge.”
And have that person remind you of your goals and your progress.
If you do not have that person in your life today, feel free to join my private Facebook community.
We currently have over 15,000 members who are all working to be better with their money every day.
We share our wins, our struggles, and our ideas with one another all in the hopes of getting just a little bit better each day, week, month, and year.
Unsubscribe From Marketing Emails
I’ve spent so much money at Best Buy just from their “Deal of the Day” emails.
My wife also leaps for joy when she gets a 20% off coupon from Bed Bath & Beyond.
You may think you’re getting a deal, but
saving 20% on an impulse buy just means you spent 100% more than you originally planned to. Click To TweetA simple trick to get rid of these seductive emails is to use a tool called unroll.me.
Unroll.me is the fastest way to go through your email inbox and remove subscriptions.
If you only have a few subscriptions, you can always scroll to the bottom of every email and find the unsubscribe button there.
Cut Back On Subscriptions
It felt like a huge win a few years ago when we cut cable for Netflix.
Today it feels like everybody is joining the streaming game and trying to keep up with them all could have you actually spending more than you would spend on cable.
And that’s just video.
There are still music, cloud storage, and even printer ink subscriptions to buy.
One way to stop spending money is to limit the number of subscriptions you pay for at one time.
For example, we refuse to pay for two television streaming services at the same time.
We find a show that we would like to binge and pay for the service that provides access to that one show.
When we’re ready for a new show, we determine which streaming service we want to pay for.
The best part of this method is you’ll usually get an email with a discount shortly after ending one service that you can use when you are ready to return.
There is No Quick Fix
Bad spending habits develop over time.
This means it will take time for you to break some of the habits you’re struggling with and stop spending money.
Don’t expect to go from $1,000 per month in discretionary spending down to $200 per month in just 30 days.
It’s possible, but not very likely.
Your goal should be progress; not perfection.
Even if the improvement is only 1%, celebrate the win and keep getting better.
Finally, remember to give yourself a little grace as you work to better your financial situation.
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