My non-traditionally coiffed blogging buddy J. Money applauded another writer’s “Two kick-ass spending tips” – or, rather, his non-spending tips, as they’re designed to curb impulsive buying.
The Stranger Test: Imagine a stranger holding the item you want to buy in one hand and its price – in cash! – in the other hand. Which would you choose?
The Urgency Test: You’re wondering whether to buy something. Ask yourself, “Would I wear this out of the dressing room right now if I could?” If the answer is “yes” and you can afford it, go ahead.
These are the “only two saving/budgeting ideas that I actually follow these days,” the anonymous blogger, Zee, notes on his site, Work To Not Work.
Good ideas both – although I do think the Urgency Test should be tempered with a bit more questioning, e.g., “How often would I actually use this?” (especially as regards things like hand tools and kitchen gadgets) and “Will this make a big enough difference in my life to spend the money?”
Put another way: There’s a reason you see new or practically unused stuff at yard sales. That reason is often, “It seemed like a good idea at the time.”
I do like Zee’s viewpoint, though — and I’ll see his two basic tips and raise him seven more ways to help avoid overspending.
1. The frugal filter. This is just more of that questioning. In addition to those two self-queries mentioned above I’d add, “Do I already have something on hand that will work just as well?” and “If I really need it, do I have to buy it now or is there another way to get it more affordably (yard sale, Craigslist) or even for free (borrowing from a friend, Freecycle)?” If you run most purchases through a frugal filter chances are you’ll put more than a few of them back.
Something better to do
Speaking of putting things back, try…
2. Walking it off. Speaking of putting things back: If you find something you think you can live without, don’t rush right to the cashier. Put the item in your cart or basket and do the rest of your shopping. Before you head toward checkout, separate that item from everything else and look at it a little more critically. Possibly flush of instant love you felt 20 minutes earlier will have simmered down a bit. It doesn’t hurt to apply the frugal filter again, either.
Still not sure? On to…
3. Sleeping on it. Put the item back on the shelf/rack and go home. If you dreamed about it all night long and woke up longing to hold it, well, you may need to seek professional help. What’s more likely is that you can’t quite remember what made the item so irresistible – or that it’ll seem like too much trouble to get back in the car/on the bus and return to the shop.
If you absolutely, truly, madly, deeply love it and can’t live without it, then maybe you should buy it. But first try to…
4. Distract yourself. Don’t you have something better to do than shop right now? Maybe you could take your dog for a walk, organize a closet, have a nice hot soak, write a letter to your grandma, look through your stockpile and dream up a creative new entrée. Staying busy can keep the want-it! feelings at bay until whatever impulse motivated them (boredom? loneliness? envy of a friend’s new whatever-it-was?) fades away. If this doesn’t sound like nearly as much fun as shopping, well, welcome to adulthood — where things aren’t always what we want. Bonus: You could end up with a cleaner closet or a delicious dinner.
The true costs
If you don’t think that will work, reach out and….
5. Get a friend to talk you down. Call a pal who will remind you (in a loving and respectful way) how frustrated you’ve been lately about your inability to pay down the last few hundred of consumer debt. Just talking it out might make the want-it! go away.
The friend could could also help you….
6. Brainstorm smarter alternatives. The two of you can think of better places for that money to end up. A few possibilities: Pad your emergency fund, throw it against existing debt, start a Roth IRA. Or create a sub-account in your online bank account that’s devoted to a bigger-ticket item – say, a trip to Ireland. You might be surprised how much those careless purchases could add up to in a year if you avoided making them.
Speaking of adding up….
7. Suss out the true cost. You can parse this several different ways, including:
- How many hours will you have to work to pay for those cute shoes or that new phone?
- If you’d be buying with a card that’s already got a balance, how much longer will it take you to pay off the new total and/or how much more interest will you pay?
- Thinking in terms of a Roth IRA or some other retirement product, what could compound interest turn that amount into over the next 20 years?
About that last: Be honest about how often you spend impulsively or mindlessly in a year’s time, then apply the compound interest scenario. Those who have tracked their spending are often surprised how easy it to nickel-and-dime themselves into short-term insolvency. But think about the long-term opportunity cost of the money that slips too easily from your wallet.
That’s money you can no longer make work for you. You can’t use it to slay your student loans faster, make a larger down payment on a car (or a house), fund a more secure retirement.
Or, maybe, make that trip to Ireland. There’s nothing wrong with spending money. That’s part of why we work, to pay for the wants as well as the needs. But spending should be thoughtful.
The good news: It gets easier. Work at mindful consumerism for a while, thinking about the bigger picture of your life, and in time you won’t need to imagine a stranger’s input on what you should be buying.
Readers: How often do you second-guess a purchase?