14 Smart Ways to Curb Spending on Impulse
By Acceler8now.com Investing Education Team September, 2007
Spending is a powerful force and one that is difficult to withstand. We all know and feel that 'spending power', the larger-than-life feeling you enjoy when you dish out money, whether paying for products, as a gift or for whatever purpose. At one time or the other, even if short-lived, each of us has relished the commanding attention money captures when you are at the spending end. Because of the authority spending commands - watch the shopkeeper effusively pouring 'sir' at you because he is expecting a chunk from you - it is easy to fall into the trap of over-indulging in the thrill of spending. Indeed, for some, it is an unfortunate addiction.
Are you steeped in spending? Do your enjoy shopping, buying and spending, just like that? Or perhaps, like some, it helps you unwind and relieve stress? Have you started worrying that your money is actually going down the drain because of your unbridled appetite for buying things, even when you may not really put them to good use? If you impulsively place orders or pick items into your cart in the supermarket or grab the latest of every product that you come across and now think it's time to clean up your act for the good of your pocket, this article is for you. Impulsive spending will ruin your finances and leave you immersed in heaps of items you don't really need. Unless you have an oil-well gushing out sweet crude that piles dollars for you on a minute-by-minute basis, you have to tackle the debilitating habit before it emasculates you, financially. Here are some measures you can immediately put to work to help you curb impulsive spending.
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Deal With the Root
That simply says you have to work on your mind to unwaveringly decide that your pattern of spending cannot be sustained and choose to beat the habit. If you don't deeply seek to overcome your impulsive spending habit, no 'how-to' rules will pull you out. One way you can get going with this is by taking some pain to tabulate, for a period, what you've poured into unplanned and unjustified expenditure. You are likely to recoil at the size of your precious resources you have allowed to go down the drain because you succumbed to the pressure of uncontrolled spending. That wake-up call is critical.
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Get Off to Budgeting
Well, you may not like the idea or have the patience for it, but budgeting is about the strongest tool at your disposal. If you don't decide to spend by design, your current unplanned spending pattern will most likely persist. You need to begin to learn to spend with some discipline and that's what your budget aims for. Indulge yourself, if you like, by allowing a budget provision, initially, for that kind of treat you enjoy. This time though, it's by design and within a ceiling you permit. Gradually, continue to cream off and move resources to top priority needs, including saving and investments. Sticking to your budget is the core of your success, so don't compromise it. If you need help with budgeting, our budgeting guide and budgeting template are ready tools to help you.
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Use a Shopping List
Don't put a wad of banknotes in your bag and get off to the shopping-mall, expecting to spend only part. It doesn't work. In a loaded shop with a variety of enticing stuff, how can you trust your already weak instinct to control your spending? You will definitely buy things you never thought of, even omitting some you really need because you've run out of money. The way out: use a list and one you will strictly work with. So decide before you take off for the mall or wherever you buy, what items you really need and these should be drawn from your budget. Take the money that covers them, possibly with a little provision as buffer and go to buy just what you planned to buy. Now, discipline is at work, right?
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Be Targeted
With your list and choice of where to shop, you also need focus. You're probably familiar with the market or mall, otherwise, there will always be people to guide you. Target what you came for, deal with it and get off the location. Roaming the mall exposes you to all the captivating goods that have been so cleverly positioned to do just that one thing: entice you and stir your buying impulse. The less you go feasting your eyes, the better for you. The pressure could get overwhelming when you have exposed yourself to some compelling items and you might just give in and buy. Prevent it by going straight to what you want, doing the busniess and getting off. Add to this the general idea of window-shopping. If you are working to cut unplanned spending, don't go looking for trouble sizing up the shops. They won't disappoint you because there is always something that can catch your fancy.
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Avoid Social Shopping
Here, we are talking of shopping in the company of friends, more like a social outing. You may suffer a lot of negative influences that push you into buying what you shouldn't. If you need company (maybe for a second opinion on choice), one trusted person, responsible at spending, is the kind of companion you need. If you have to go with a group, you must be mentally prepared to work with your plan and resist covert or overt pressure to buy certain things that may be out of your budget, list, income range or even need, just because others think you should. Stick to your plan. Then where to buy. Are you going to that obviously overpriced outlet just because it's where the big boys and girls go to shop? If you know the prices are way out, do you have to join? There are other fora to meet people and you don't have to sacrifice your income just to see a lot of shopping crowd.
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Understand the Motive of Advertisers
It is simple: they want to get your money. All the promoters too. So, they do take their time to package the ads that hit you - the colourful images, the models, all that make-believe. Is the reality necessarily so? Hardly. So, never get carried away. If an offer relates to something important to you, take your time to research and evaluate it further and, if it qualifies for a place in your budget, then deliberately provide for it. The rest, forget them. Don't let the colourful advert push you to your bank for more cash, because more products and more adverts will come. You can't empty your account for them, or will you?
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Use the Acid Test, Always
The money you spend has a lot of opportunity cost in other benefits it can bring to you. When invested, it can grow substantially, a potential you lose when you spend it off. So subject your spending to that important scrutiny. Is the purpose I'm spending on more important than the huge impact this could make on my life if I save and invest it? Is this item critical at this point? Can I do without it and what will go wrong if I ignore it? Subject each spending to a 'need analysis', because, as stated, it has a price. If you can't sufficiently justify it, given the opportunity cost, drop it. Simple.
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