Are spenders doomed to a life of bad decision-making when it comes to saving? I, a self-admitted spender, believe that it is within our ability to change. Thank goodness experts agree that with a bit research and some stick-to-it-iveness, even full-blown spenders can be cured.
It seems that most folks fall into one of two camps: fastidious savers or unstoppable spenders.
The real question is: Are spenders doomed to a life of bad decision-making when it comes to saving? I, a self-admitted spender, believe that it is within our ability to change. Thank goodness experts agree that with a bit research and some stick-to-it-iveness, even full-blown spenders can be cured.
Getting with the program
So what does it take to get spenders on the savings train? According to personal finance expert Manisha Thakor, the change happens when there is a forced transformation (think job loss) or when folks become aware of the relationship between money and work. While a forced transformation usually only results in a temporary modification of spending habits, knowing how many hours you need to work to buy something results in consistent mindful spending. Logging your spending can help, too. “I often find that when people simply write down everything they spend for a month … that one act can cause a massive shift in behavior, because it makes the act of spending more mindful,” says Thakor, co-author of “Get Financially Naked.”
Save every day
“With any kind of change, the keys are repetition, not trying to do too much at once and having some sort of touchstone or behavior modification reminder,” Thakor says. She suggests finding one act of saving do each day for 30 days. That means calling creditors for lower interest rates or refilling reusable water bottles instead of buying new; one thing each day. “The repetitive act of taking one step forward is establishing this new behavior each day and is incredibly powerful,” Thakor says.
A bit at a time
Don’t bite off more than you can chew. “If you try to solve all problems at once, odds are you’ll feel overwhelmed and just give up,” Thakor says. For me, this means taking money away from kids’ items and gourmet foods in order to put more into savings.
Find a spot on the horizon
Have you heard this phrase in yoga class? It works in personal finance as well. Figure out your pre-tax hourly wage and focus on it when considering purchases. “Next time you see that ‘must-have-it’s-screaming-my-name-thing-a-ma-jiggy’ for $200 ... do the math,” says Thakor. “Is it REALLY worth 10 hours slogging it out at the office? Maybe yes, maybe no ... but now you have a touchstone.”
Molly Logan Anderson is a freelance writer who lives in the western suburbs of Chicago with her husband Mike, three kids and black lab. Join Molly on her family’s journey of living a frugal life and making financial freedom their reality.