I really love to shop.
The fact that I always spent more, no matter how much more we made, was always a problem, until I started to really figure out how much it was hurting me.
The funny thing is, I have a lot of frugal habits that allowed me to save a lot of money when I needed to. I’ve switched from 90% of the disposable products we’ve used, and pretty much the only things we regularly keep in the house that are disposable are q-tips and toilet paper. All of the paper products we used to use like disposable napkins, paper towels, and even disposable diapers aren’t something you’ll find at my house. I even started canning and growing our own food so I would have a homemade pantry that gave us free food all year long! But all of those frugal habits didn’t amount to much when I was just spending the money other places.
So, I came up with a few new habits that helped me get over the crappy habit I had of spending money I didn’t need to be spending.
To be fair: I did not just magically start doing all of these things overnight. That wouldn’t have worked, because it wouldn’t have been sustainable. I worked hard to implement these things over time, so I could see what worked for me and what didn’t.
1. Understanding why I had the bad habits in the first place
Most compulsive habits have a root in emotional and mental issues, and spending money is definitely no exception to the rule. I worked through all of the exercises in the book Worthy by Nancy Levin. (I got the audiobook, which I don’t recommend because it made it hard to do some of the exercises.)
In my family, financial independence wasn’t really a thing that was modeled. My grandmother was always very generous, and loved to share that generosity with my mother (and us kids). Not all of the time, but many times when we couldn’t afford extra things we wanted like a summer camp, lessons for music, or another activity, mom would ask grandma to pay for it, or have us ask. If something was missing, Grandma was there to cover it.
After a lot of soul-searching, I realized the reason I spent money was to reassure myself that no matter how slim things got, I could still have what I wanted. This was clearly dysfunctional, because if I’d just have paid my bills, then saved and invested money first I could have prioritized the things I wanted and had lots of nice things… but instead I chose to spend right up until the limits of being able to barely eek by. This gave me some weird rush.
Understanding the emotional reasons why I was spending money gave me the tools I needed to stop the behavior, and provide alternative behaviors that filled the same need. I created a new money story (using the tools I include in my course, Your Money Your Way) and I looked at how I wanted my relationship with money to look specifically (again, this is another lesson from my course, which is just proof that no matter how much work you’ve done to improve your relationship to money, there’s always more room to learn and ways to improve!)
Then, I got down to the bitty gritty habits that helped me.
2. Find a bigger, better motivator
Being frugal for the sake of being frugal just doesn’t motivate me. Neither does the abstract idea of “financial security” whatever that really means. But, there are a few things I do love, and that motivate the heck out of me.
- automated income
- avoiding debt
I realized that by putting my money in savings, it would just keep growing. Same with investing. If I just had the discipline to leave it in the damn account, it would keep bringing me money in every month, and that was a beautiful thing that made me want to start saving.
But even more than that, I wanted a house. A nice house. the catch was that I didn’t want a mortgage. I hate debt, and I’m not willing to go into monetary slavery to get a house, so the only alternative was to buy one with cash. That became my new why. I knew in order to own a house, I needed to have a bigger emergency fund, because there would be no kindly landlord to fix things that broke. And then, of course, I’d need money to actually buy the house.
3. Create baby steps around the newer, bigger motivator
For me, the bigger motivator left me with some pretty clear baby steps that I broke down into mini goals.
- Spend less on flexible areas (like food) and use that money productively
- Get an emergency fund of 3-6 months of expenses and LEAVE IT IN THE BANK (this is not an Amazon spending fund!)
- Create a stream of income that directly funded the house fund (savings interest + business income)
- Find a way to track my progress that gave me small, measurable wins to keep me motivated
4. Make it more work to spend money
If you have apps on your phone that encourage you spend money (hello Amazon and Etsy!) then remove them altogether. The more steps you have to take to make something happen, the more time you have for your brain to kick in. Instead of thinking “Hey, I should grab those shoes that I want right now while I’m thinking about it!” then hopping on the app and making a purchase – if you go to open an app that isn’t there, your brain will think, “Hey. Where’s the app? Oh right. I deleted it because I’m trying to stop spending to fill [whatever dysfunctional money story you have that makes you want to spend money compulsively]. Alright. [Insert new affirmation here]”
5. Spend into savings and investments
One of my worst offenders for blowing money is fast food, which is ridiculous because it’s also the one thing that’s against about every major goal in the areas of finances, health, wellness, and conscious living in general. So, whenever my husband is on the way home and asks what’s for dinner, or when I’m tempted to run out for some fries, Instead I’ll transfer the money into savings or into Acorns. My reasoning is that if I can make room in the budget for junk food, I can make it for savings too.
Here’s the funny thing: when I first started doing this, I didn’t say anything to Ian about it, because it felt silly. Honestly, I was kind of embarrassed about it, which is ridiculous considering knew whenever I was eating fast food, because he was eating it right along with me! But for whatever reason, I decided to keep this one to myself.
Several times over the next month after I started this he would say things like, “I just don’t understand why we’re so tight!” when I said no, we didn’t have the money for this and that extra thing. But when I told him we’d hit a couple of our goals with saving and investing, he was thrilled… so I figured it was time for me to explain where the money had been going. He was relieved and told me to keep it up, even though it was hard to be frugal sometimes.
6. Really, actually pay the bills first
I hate having money sitting in my account, and while I’m slowly getting used to it, when I first really decided to tackle the compulsive spending problem I had, I knew I didn’t have the discipline to leave money in there. I cancelled all of our automatic bill pay and started paying our bills weekly when his paychecks came in, bringing us down to nothing extra except what we’d need for food and groceries.
I use Simple bank, which allows me to put money into “goals” – which is where I held money for things I couldn’t pay weekly, like our trash bill that gets paid quarterly, money for filling our propane tank that we use for our central heat in the winter, and small subscriptions like Netflix. I’d log in and see that the “Safe to Spend” amount was at $0, and knew that all of the money allotted there was for bills I had to pay.
I hated that it took me forever to pay the bills, but I always knew when there was a little splurge money to go around.
7. Build splurge money into the budget
Ian gets a set amount each week that goes into his fun money account, and so do I. Either one of us can spend that money however we please, including saving it for something big (that’d be Ian) or buying piddly little things that bring us joy (I have an ongoing Amazon list that has lots of things I’m waiting to acquire!).
Sometimes, I just want to spend money, and having permission to do it makes me not feel guilty when this happens. I don’t need to be tempted,.
Oh, and obviously, since I lacked self control, this had to come after paying the bills. Spending “just a little extra” can turn into a several hundred dollar Amazon splurge all too easily – yes, that’s happened.