Written by Andy Sobel
Published May 15 | 8 minute read
We dare you to create a budget and live within it — no deviations allowed — for a week, a month, a year, however long you can.
Sticking to a spending plan can seem to go against human nature. Necessities are necessities; for example, the rent has to be paid. But for the rest of your budgeted money, the heart wants what it wants and as we all know, what it wants is to splurge impulsively and emotionally on nonessential items like a sweet-smelling midmorning muffin or a shiny new car when your old one does just fine.
But every dollar you spend on something expensive or ephemeral is a dollar you don't have for your longer-term, more meaningful goals. So, here are seven strategies to help you say no to nonessentials and yes to saving money.
What is a budget, anyway? A budget isn’t just a list of spending categories — it’s a conscious spending plan that reflects your priorities and helps you decide, ahead of time, what your money is meant to do.
For starters, in a successful budget takes careful account of both fixed and variable expenses, in addition to the money you have coming in and are saving. Your budget should not be determined by how much you are spending alone, especially if you are consistently financing expenses with debt. Rework your budget to make sure your plan accounts for saving some money — it will help you stay on budget longer.
Life is about making choices and a budget informs those choices. Impulse spending often happens in moments of emotion, convenience or stress, not because a purchase was planned or necessary. Recognizing those patterns is the first step toward changing them.
Here’s an idea: Write down how you spend money — either in a notepad or on your smartphone notes. This will allow you to see your soft spots — the shopping categories in which you consistently and egregiously overspend — and to rein in such spending.
One common trap is "spaving,” when you spend money you didn’t plan to spend just because something is discounted, even if it wasn’t in your budget to begin with.
The roof over your head, food on your table and gas in your car—what do they have in common? They’re necessities and they’re also prominent line items in a typical household budget that together tally, let’s say, 50% of your total spending. The other half of your budget would be split between savings and the things you really want but don’t really need—the nonessentials.
READ MORE: 50/30/20 Budget Rule
You know what those items are because you often buy them when the moon is out and a screen’s glow lights your room or whatever time your self-control is at its weakest. Before buying a nonessential item, try building in a cooling-off period — 24 hours, a weekend or even a full week — to see whether the purchase still feels worth it once the impulse passes. The item in question will probably still be there in the morning, and you may have a different perspective on your potential purchase.
There are many ways to define a friend, and one of them is someone who will stop you from causing yourself any harm. But they can only help if they know you are about to do something you might regret.
So before you plunk down big-time cash, or worse, go deep into debt to buy something expensive, ask someone you trust completely (your significant other, your parents, siblings or a close friend) whether they think the purchase is a good idea. They may green light you, but they may also help you to see why your purchase isn’t necessary. What counts as “expensive” depends on your budget, which is why setting clear spending thresholds ahead of time makes these conversations easier and more effective.
Why aren’t you sticking to your budget? Yes, you saw a nonessential item you wanted and didn’t really have room for, and you bought it anyway. But giving in too easily is just the symptom; what’s the cause? Psychologists cite any number of reasons; here are five to consider:
It's natural to desire something exciting and immediate, but remember to keep your long-term goals in focus. By making thoughtful choices with your credit, you can enjoy the moments that matter while building a secure and balanced financial future.
Feeling down and there’s a hole in your sneakers? A new pair will make you feel pretty spry, at least temporarily. Is this therapeutic solution aligned with your longer term goals?
Some people struggle with compulsive shopping behaviors, which can make sticking to a budget especially challenging without intentional safeguards.
When you see something is discounted at the store, you focus more on the discount than on the price it was discounted from, leading you to emphasize the “savings” in the purchase more than the spending itself.
Participating in an auction, for example, can be a thrill. Your heart races and the adrenaline pumps as the bidding gets higher and higher. So much so that you can forget what you considered the value of the item to be in the first place.
The good news is, once you know what you are susceptible to, you can walk away before the trigger wreaks havoc — and stick to your budget.
READ MORE: Benefits of Multiple Credit Cards and How to Manage Them
Every time you walk away from a nonessential purchase, you can choose to focus unhappily on what you don’t have or happily on what you do have — saved money. Saving is the only way you’ll be able to afford the kinds of things that take years to afford.
Leaving a luxury item on the showroom floor means that you’ll be one step closer to the biggest-ticket items — a car, a down payment for a home, a destination wedding, your kids’ college tuition, early retirement — without incurring debt that could hold you back for years.
We all need incentives to modify our behavior. So go ahead, make your day. But before you book a table at that steak house, perhaps a trip to the butcher and a few minutes in front of the grill make more sense overall. Same T-bone, but one comes with a partial down payment on a long-term goal; the other with a sweet memory, perhaps, but here today, gone tomorrow.
READ MORE: What Is Loud Budgeting?
Andy Sobel is a freelance writer and editor. He has held senior editing positions in The Wall Street Journal's New York and Brussels newsrooms and was managing editor of American Banker.