Yahoo Finance Rachel Cruze Reveals 14 Ways To Stop Overspending
Making purchases you didn’t expect, whether small or large, can add up to big expenses over time. Controlling your impulsive buying habits and staying on budget might seem simple, but many struggle with it. Luckily, Rachel Cruze, financial expert and co-host of The Ramsey Show, understands how people can get caught up in impulsive buying.
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Here are some of her tips for how to cut back and put that money toward your savings.
1. Plan Your Purchases
If you head into a store without a concrete plan or just to look around, you’re more likely to leave with an impulsive purchase.
Shopping with a plan can cut down your spending significantly. Avoid window shopping or scrolling through online retailers to give yourself fewer chances to buy something you don’t need. Making a list before you start shopping can help you stick to your budget and minimize extra spending.
2. Track Your Expenses
Budgeting allows you to track your expenses and set goals that can help you stop impulse buying. If you know you’re on a budget, you’ll be less likely to grab a few snacks and a magazine when standing in the checkout line.
It’s easier than ever to start budgeting with a variety of budgeting and expense-tracking apps that link directly to your bank account. Tracking your expenses may also help you see just how much money you’re throwing away on impulsive purchases.
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3. Sleep on It
It’s easy to fall into the trap of making impulsive online purchases, especially through websites that allow you to buy with just one click. Putting some time between when you see something and when you buy it leaves you space to consider how much you want it.
Cruze cautions against limited-time offers, pointing out that merchants use them to pressure you into making quick purchases without taking the proper amount of time to assess if it’s worth it. Sleeping on the decision and giving yourself a day or more will help you determine if it’s actually something you need and whether it fits into your budget.
4. Give Yourself Some Wiggle Room
Limiting what you can spend can help you spend less, but sometimes it’s a good idea to let yourself enjoy your money. When you set a little bit aside for impulsive purchases each month, you won’t feel so guilty when you suddenly see something you want.
5. Avoid Retail Therapy
Cruze explains that emotions are one of the main reasons people make impulsive purchases. If you’re having a bad day, you might pick up a new pair of shoes or the newest tech gadget to lift your spirits. You might also make a small purchase because you’re bored, anxious or putting off a task you don’t want to do.
This kind of buying adds up and plays right into the hands of marketers. When you feel the urge to buy something, determine where the emotion is coming from and be honest with yourself. Noticing your mood can help prevent unneeded spending.
6. Don’t Shop Alone
Heading out to the mall by yourself makes buying things you don’t need a lot easier, as you’ll be able to talk yourself into a purchase. Bringing along a friend or family member is a great way to make sure you don’t buy impulsively.
Before shopping, let your shopping partner know what you’re there to buy and that you’re trying to cut back on extra spending. That way, when you see a new shirt you just have to have, they can hold you accountable or talk you out of it.
7. Shop With Just Enough Cash
One strategy Cruze suggests is to only take the cash you need when you go shopping. If you determine how much money you’ll need and head to the store with a limited amount of cash, you won’t be able to buy more than you came for. It can also be beneficial to leave your debit and credit cards behind to make it impossible to buy anything else.
8. Be Careful With Your Credit Cards
Putting anything on your credit card can become problematic if you don’t pay it off right away. Cruze points out that impulsive buying can add up, but adding an extra 20% interest on top of that can be devastating to your financial health.
Credit cards make it very easy to buy things you don’t need and might be unable to afford. Cruze cautions against falling for other traps like spending to get points or cash-back rewards. Getting rid of credit cards altogether may be the best option for some.
9. Make It Harder To Use Your Card Online
If you’re an avid online shopper, you might have the details of your debit or credit card memorized. If your computer automatically saves it, you might not even need to know them off-hand. Being able to purchase something online without needing your card can be detrimental to your budget.
One solution is to clear your browser’s data and not store your card information on it. Needing to enter your card’s details manually each time offers just enough of a barrier to help deter you from spending impulsively.
If you’ve memorized your card’s number and can’t get it out of your head, consider calling your bank and requesting a replacement card with a new number.
10. Unsubscribe From Email Lists
Controlling your spending habits can be difficult when sellers constantly bombard you with advertisements. Cruze recalls how she’ll spend within the limits of her budget until she suddenly gets emails with all of the new deals she’s missing out on.
Unsubscribing from unnecessary email lists keeps the ads away and reduces your spending opportunities.
11. Restrict Your Social Media Use
Social media can play a dangerous role in spending. When you’re scrolling through apps and looking at how well everyone else is doing, you’ll likely feel the need to buy a new outfit or book a trip to Cancun.
One way to combat this is to reduce your screen time. Downloading apps that only allow you to use social media for a limited time each day — or deleting the apps altogether — can help. Less time on social media means fewer impulses to buy.
12. Don’t Keep up With the Joneses
In the same vein, constantly keeping tabs on what those around you have or don’t have can put you in a position to make impulse purchases. When your neighbor rolls out a new lawn mower or your coworker boasts about their new TV, you might feel the itch to get one of your own.
Comparing what you have to what others have can lead to dangerous spending habits. Instead of putting money into your savings account, you’ll put that money toward items to maintain appearances. Keep your ego in check, and watch your savings pile up.
13. Challenge Yourself
Cruze mentions another strategy that can help curb your impulse to buy: a no-spend challenge.
This challenge can take different forms depending on your situation. In some cases, it may mean completely halting any spending for a period of time. In other cases, you may have some essential costs, so limiting yourself to a strict budget will do.
14. Remember the Big Picture
Making a budget and having an overarching financial plan can help you keep your priorities in line.
Whenever you’re about to make a purchase, thinking about your goals — like saving up to take a cruise or paying off your student loans — can motivate you not to impulse buy. Keep your big-picture goals in mind the next time you go shopping, and it’ll be easier to stop yourself from overspending.
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