Are You A Spendthrift? Three Tips To Overcome Bad Spending Habits!

If you love to spend money, you are not alone. Many people have a bit of buzz from spending money. That feeling is there when you make a purchase may be slowly driving you into the poor house. Here are a few tips to overcome your spendthrift ways.

The book The Power of Habit (amen.To/VdlB1X) explains the nature of a habit in three steps, the cue, the routine and the reward. Whenever we draw up a habit, according to the book, it follows that pattern. A core acts as a trigger. My phone beeps. We respond with the routine—the habit itself. I check my email, Facebook and Twitter and return to my work ten minutes later. We then obtain a reward. I feel loved because someone interacted with me.

The same simple pattern is working with spending. If we’re in a store, we’re surrounding with signals to buy. For the worst spendthrifts the biggest temptations are deep discounts. Substantial discounts to justify our guilty pleasure of spending money. Is the reward, really having the new thing? Maybe not. The reward may be the slight buzz we get from spending money. How to break the habit?

1.  Look at the cue. If you love to window-shop but tend to go from looking to purchase, start by not looking. Get something else to do that won’t put you in harm’s way. If you are placed on a restricted budget, window-shopping may be pure torture.

2.  Focus on the routine. Identify those times when you actually spend your money on things that you really don’t need. What could you do instead? If clothes are your actual problem, make a deal with yourself that when you don’t purchase clothes that you were considering, you’ll do something else you love instead—that isn’t so costly. It could simply be purchasing a soda or an ice cream at the food court instead of that cute new top. Change the routine.

3.  Check the reward. If when you change the routine, you don’t feel as good or better afterward, you may not be satisfying the craving. Try a different substitute. Try getting to a movie or renting a DVD, anything else, to see if you can find the same pleasure with less money. Very quickly you’ll change the habit and save some money!

Recall that when you buy something on sale that you don’t need, you’ve still spent money you didn’t need to expend. One way to find out if you have a problem is to inventory your closet. If you find lots of clothes you didn’t even remember you had, you can make use of a little bit of habit therapy. Read The Power of Habit (amen.To/VdlB1X).