5 Methods I Used To Stop Overspending
Dave Ramsey states that there are savers and spenders in a relationship. I always thought I was the saver. HA. After budgeting for a few months, I saw a big, ugly trend emerge. I spent a lot of money. Clothes, groceries, dinner with friends, home decor, Amazon. Oh, Amazon. The list could go on and on. Honestly, I’m not sure why I was surprised.
I was a former proud Lux Cardholder at Banana Republic, the owner of a local clothing boutique knew me by name, and I loved my Starbucks gold card. It was time for me to cut the temptations and reduce my overspending.
Here are 5 ways I gave myself a spending detox.
1. Cut Up The Cards
Banana Republic, Loft, Kohl's, Victoria Secret, Target: Meet scissors. I held a brief moment of silence for my Red card and then cut mercilessly.
You do not, I repeat do not need a store credit card.
If you have consumer debt, you’ve lost your credit card-carrying privileges. Until you show that you can exhibit self-control and that smarter spending has become a habit, then and only then, would I consider using credit cards for travel hacking or points.
If you are like me, or most Americans, a break up with plastic for a year or two may be a necessary step on the path to changing your financial life forever.
I needed to learn to have a healthy fear of these little plastic tools that can so easily be misused. To me now, there are 3 levels of credit card users:
If you have had consumer debt or carried a balance on a credit card, you need to cut up all the plastic for at least two years until you can show that you are able to make wiser choices.
I also had to change the paradigm in my mind that credit cards are not safety nets. My goal was to become a millionaire and no one becomes a millionaire due to points earned at Loft.
It was time for me to think bigger and stop shooting myself in the foot. So what do I carry in my wallet? Two debit cards. One from my local credit union and a Target debit card.
Credit cards are a tool. A tool where you can plan ahead to spend a specific amount of money that you already have sitting in the bank and run only this amount of money through your credit card to gain a reward.
Then, you can pay off this said card immediately since the money is sitting there, ready to be used.
This avoids cashing in your one-way ticket to debt city.
This is the travel hacking life, my friends.
This is hard work and takes careful planning.
At the end of 2019, I took my first stab at travel hacking and being a strategic user, which was terrifying since we had been credit card free since 2016.
Here is how I hit my goal spend to get our points: We took a vacation with family where we paid for the flights and the Airbnb-- and the family members paid us back for the bookings.
We spent $3,000 through an American Express Delta Card to make the online purchases. We collected over 100,000 points. And then immediately paid off this credit card.
Our reward? A low stress, paid for vacation.
This is the person who loves points for everything. They have graduated from, or blend in being a strategic user. Perhaps they don’t want to put in the work it takes to travel hack, but enjoy a free trip now and then.
- Has no consumer debt
- Cannot remember the last time they did not autopay in full each month
- They have an emergency fund of cash for emergencies
- They do not rely on pieces of plastic
- They swipe one favorite points or cash back card everyday
2. Try Cash
Green is the way your budget should look if you follow this plan.
Personally, I loathe the cash envelope system. People swear by it, but nothing was worse to me than caring around big, clunky envelopes. Instead of the envelope system, I use the clip system. In a typical month, I carry 1-3 clips.
Before the month starts, I decide how much money I will spend on luxuries and personal items. These items include hair, nails, clothes, shoes, gym memberships, subscriptions and anything that is not a need. I then go to the bank and pull out exactly the right amount of cash. I put this in my wallet, and that is all I am allotted for one month.
To be completely honest, I have minimal self-control. Knowing this, I split this money in half.
For example: Say I take out $100 for the month of April. I will put $50 in my wallet for the first two weeks, and then on the 15th, the other $50. If I don’t do this, I end up with $0 by April 5th, essentially setting myself up to fail. I opt to do $50 every two weeks.
Unsubscribe from all shopping and retail emails. Yes, this includes Target.
If you feel that unsubscribing all together is too much of a commitment, use the filter option. For Target and Meijer, I filter as "mark as read". This way, if you plan a shopping trip, you can still find these emails to see what sales are happening at this time.
If you practice this, the daily temptation is out of sight and out of mind. I can't shop sales if I do not know they are happening.
4. Cut One Budget Item
Could you live one month without ________? Go through each line item on your budget and ask this question.
As you see where you spend the most money, you will get an idea of what to cut out. I found myself asking my husband if he wouldn't mind not eating. Kidding, but food can be a budget killer.
I recommend cutting the internet or your cable service. If you have subscriptions or memberships, those are often an easy cut. Since our internet was more expensive than our $55 Dish bill (hello living in the middle of nowhere), we cut the internet.
5. Farewell, Facebook
Lent of 2017, I gave up Facebook and I may never go back. I was doing the four steps above like a boss when I realized I had more than enough clothing and I didn’t need more of… well, anything really.
But retailers are smart. Target and Loft found me on Facebook. After I became dangerously close to buying a new handbag "for work," I knew social media was going to be an issue.
I realized during my Facebook fast just how much time I was wasting. Time is your most valuable asset. My urge to shop dropped dramatically with the drop in advertising exposure.
I highly recommend a 40 day (or more) Facebook detox-- it was amazing.
The second thing I learned about Facebook is that the sales of items on Facebook were going to be the death of my budget. So, if you are sitting there thinking, ‘Ah no way am I giving up Facebook, Sarah,’ this next idea is for you.
I loved the Facebook groups. Antiques, high-end furniture resale, online garage sales, car shopping... all of it. Try 40 days of unsubscribing or leaving any group that is selling things. They will still be there, for you to follow again at a later date.
I’ll reiterate: It’s all about out of sight and out of mind.
Prepare to have FOMO, but I promise you, life will go on. You will make it.
It’s hard to believe, but there was a time before Facebook. If this is too much to ask, please ask yourself if you are too attached to the likes, and mindlessly scrolling your feed.
My detachment did not happen overnight, but the path to personal and financial wellness is all about modifying behavior. Being a do-er. Join the club, fellow recovering spenders.
Happy unsubscribing from those emails, aspiring retirees.
Sarah Brandenberger is the founder of Nerds Guide To Financial Independence, a brand dedicated to showing that financial independence is possible through real estate investment. She began her debt free journey in 2017 and quickly became a voice for budgeting and personal finance information as she and her husband paid off over $100,000. They discovered real estate investing and now own four properties while helping others towards the path of FI.
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