With new technology like “tap credit cards” and “Buy Now” buttons on websites everywhere, it’s never been easier to spend money quickly and impulsively. But if you find yourself with a spending hangover each month after looking at your credit card statements, you need to make some serious changes towards more mindful spending.
We all waste money, sometimes. Feeling tired, stressed, or underprepared can lead to lazy spending, which causes regret. And the sad thing is, many impulse buys don’t actually make us any happier! They add stress to our lives and finances. And they even clutter our homes.
Mindful spending habits will allow you to use your money as a tool to bring you closer to the things that are important to you! Here’s everything you need to know about mindful spending, including ways to implement it in real life.
What Is Mindful Spending?
Mindful spending is being intentional in how you part with your money. It’s about matching your spending habits with your goals and values in life.
You might be thinking this means penny pinching and not having any fun. But it’s actually the opposite! When you take time to fully consider all your purchases, it allows you to cut back on the things that don’t truly move the happiness needle. And this leaves you more cash to dedicate towards the things that do!
Here are some tips and examples to try more mindful spending in real life…
There’s a lot of self discovery involved in this mindful spending process. Here are a few questions to ask yourself when you come across an item and think, “should I buy it?”.
14 Tips for Mindful Spending
We all want to live life in a way that aligns with our personal beliefs. But sometimes our values get lost in translation and we end up with buyer’s remorse. Try incorporating these tips into your routine to adopt a more intentional spending mindset!
1. Confirm Your Values And Goals
In order to spend according to your values, you have to actually know what those are! Are you a person who lives for new experiences? Do you value having flexibility in your schedule and hope to retire early? Are you obsessed with a hobby like biking, music, or pottery? Are you saving up for a big purchase like a home or a vacation?
Getting clear on your goals and values helps you to consider how each purchase either reinforces your beliefs or contradicts them. Buying a few Starbucks brown sugar oat milk shaken espressos may not feel worth it to someone who is laser focused on saving up for a European vacation. But, maybe Stabucks is worth it to someone (cough, cough, me…🙈) who loves coffee and looks forward to that treat every week. That’s the fun part about mindful spending. YOU get to decide what moves the needle for you!
Take the time to figure out what is important to you. A great exercise is to grab your credit card statements from the past few months and reflect on your past spending. Which purchases brought you joy? Which ones did you regret?
If you need a little extra help understanding what drives you to save and invest for your future, check out our episode on the why behind money. Strap in, because this is one of the very first episodes of HTM! It is, however, still packed with some seriously good advice on how to better understand yourself and your finances.
Another great resource is James Clear’s Core Value List. Which values stick out to you most? How can you funnel more money into those values, and less into ones that you don’t identify with?
2. Identify Your Spending Triggers
Another great way to avoid mindless spending is to identify the triggers that make you want to abandon all responsibilities and go on a three hour shopping bender at Target.
Do you tend to overspend when you’re feeling stressed out, or insecure? Are you doom scrolling on Instagram which is filling you with the urge to keep up with the Joneses? Knowing your spending triggers will allow you to understand yourself better. It also helps you question why you feel like shopping in the first place.
3. Get Ahead of Those Emotional Triggers
Once you’ve identified some of the reasons you overspend, you can come up with a game plan for getting ahead of them! Relying on willpower is hard, and motivation can be fleeting. That’s why it’s important to plan ahead!
For example, if you know that going to the grocery store while hungry leads to you completely blowing your food budget, then plan to go after you’ve eaten. If you can’t be bothered to cook after work, try meal prepping to curb your takeout habit. The crock pot can be your friend here.
If you turn to shopping when stressed, try writing down some alternative stress management techniques to turn to when you hit a busy season at work. This might sound quirky, but dropping to the floor and doing 10-20 push ups can quickly diminish the pull to start shopping online.
4. Ask Who You’re Buying This For
Social media is an even bigger part of our lives these days and it’s hard to remember not to compare yourself to what you see online. Remember that apps like Instagram and Tiktok are usually a highlight reel of someone’s life. You’re not getting the full story.
Sure, someone might have an amazing kitchen, but they might also be swimming in credit card debt from that remodel. You just don’t know. You might find yourself drooling over some new designer sneakers you saw on Instagram, but do they actually suit your personal style? Or do you only want them because you want validation from your peers.
This may sound harsh, but spending to conform to your neighbors or to impress the people you admire will almost always backfire on you. It can lead to you not having enough money in the face of an emergency because you’ve spent all your money trying to keep up with people you’ve never met.
At the end of the day, you are YOU and they are THEM. Before you make a purchase, ask yourself who you are buying it for. Prioritizing spending on the things that bring you joy will make you happier than you ever could be attempting to live in a way that others folks are pushing.
5. Look To Your Big Three
Unfortunately, I’m not talking about your sun, moon, and rising signs here! The information we seek isn’t written in the stars, but instead can be found in your housing, food and transportation budgets.
Don’t leave these stones unturned. You may be spending money in ways here that you never really thought about because you assume that they “cost what they cost.” With a little creativity, you may be able to cut back on these expenses! For example, maybe you could rent out a section of your home for some extra income, or save money by shopping around on car insurance.
Related: With a little mindfulness, you can supercharge your savings by optimizing your home and spending less on utilities! Saving money doing laundry is super easy, too!
- 9 Ways To Cut Down Your Monthly Gas Bill
- 13 Ways To Save Money on Electricity
- 8 Ways To Save Money On Your Water Bill
6. Track Your Spending
Mindful spending is all about paying attention. Usually, we tend to pay less attention to smaller expenses, but uncontrolled small purchases can lead to us hemorrhaging money! Challenge yourself to track your expenses for a month. You’ll be more aware of just how much money those small charges here and there can add up to.
Budgeting is the best way to start tracking your spending, and it has tons of other financial benefits as well! Any software or tracking system is totally sufficient for this, or you can even use a pencil and paper if you’re feeling old school. If budgeting is a little intimidating to you, try a software like You Need A Budget, or YNAB, which makes it easy to see all of your spending in one place.
Manually entering your spending into your budget can be a great way to alter your behavior, because it makes you “feel the pain” of the money you spent rather than ignoring it! This can help you come face to face with ingrained behavior patterns and work to switch them into good financial habits instead.
7. Ignore Sales Unless You Need Something
Sales are my kryptonite. That’s why I’ve had to unsubscribe from the emails that my favorite retailers love to feed my inbox!
Big discounts can be a HUGE trigger for people to spend money they weren’t planning on spending to begin with. Sure, you can save 50% on that item, but you’ll save 100% of your money if you don’t buy it!
Now, I’m not hating on sales. Like I said earlier, I love them! But sales should be used as a tool to get the things we were already planning on buying at a discount. If you’ve decided you want to buy something, try to intentionally find a better price, or sign up for a company’s emails to be notified of the next sale. Once you get that specific item you wanted at a much lower price, it’s time to unsubscribe!
And hey, if you enjoy shopping and value being able to browse your favorite stores, that is awesome! As long as you’ve decided that it’s something that’s important to you, it can still fall under the umbrella of mindful spending. To keep it under control, try adding a shopping fund to your budget. This allows you to spend guilt free when you see a good sale!
Related: Determining needs vs. wants
8. Perform A Subscription Audit
Remember when you could just buy a software and theoretically use it forever? That feels like eons ago! 😅
Subscriptions are the hot new business model for everyone, like it or not. And while there are some advantages to it, most of the time we wind up continuing to pay for services we no longer use. Which if you think about it, is like the complete opposite of mindful spending!
The truth is, most individuals massively underestimate what they spend on subscriptions. 54% of folks undershot how much they spent on subscriptions each and every month by over $100! That means they’re spending more than $1200 annually on services they don’t want or need. Using the rule of $173, that’s $17,300 spent over a 10 year period!
Take the time to look at what you are paying for automatically each month and cancel anything you don’t use often. Remember, this is super low stakes. If you miss it, you can always resubscribe at any point in the future!
9. Avoid Optimistic Spending
Another habit that can get in the way of mindful spending is optimistic spending. This is the act of buying things for the person you want to be instead of the person you are currently.
We’ve all been there, donating $20 a month to Planet Fitness because we want to be the kind of person who goes to the gym. Or watching produce go bad in the fridge because we want to be the kind of person who cooks every night.
Instead of going from zero to one hundred, try testing the waters a little bit before taking a big financial plunge. Can you work out at home twice a week to prove to yourself that you’re ready to build a consistent workout routine? Can you do pantry challenge and eat what you already have in your fridge, freezer, and pantry in order to create a tasty dinner before going to the grocery store? Challenge yourself to institute some changes before you start throwing dollar bills at the problem in an overly optimistic fashion.
While it’s important to consistently work on improving yourself, self acceptance and understanding also go a long way. Maybe the gym never worked for you, but you love hiking. Know yourself and try to avoid spending money on items and services that you’re not likely to consistently use.
10. Organize What You Have
Did you know that a study from 2017 estimates that we spend over 2.5 days every year looking for things we’ve lost? Even worse, sometimes a disorganized home can cause us to accidentally purchase things we’ve forgotten we already own!
If you’re feeling spendy, try organizing what you already have. You may find joy in discovering things you’ve lost or forgotten about. It’s like shopping for free in your home!
11. Consider The Secondary Costs
Another way to practice mindful spending is to make sure you consider the secondary costs before you make a purchase! Everything costs more than you think! Ask yourself: Will this cost more money down the road? Will it lead me to waste time? Will it take up mental energy?
For instance, buying a used car is a smart move. But remember that there’s more than just the sticker price that you’ll be paying. You’ll have to budget for maintenance, gas, and insurance. A massive amount of the stuff we bring into our lives requires more money if we want to use and enjoy it. Make sure to consider those additional expenses before pulling the trigger on a purchase!
12. Think About It In Terms Of Hours
Time is our most precious resource. No amount of money has ever bought a second of time! Would you still buy that new watch if you realized it would cost you 20 hours of work?
Thinking about a purchase in terms of how many hours you would have to work in order to pay for it can really put things in perspective. Ask yourself, “is this something I would be happy to trade my time for?”
When you frame your purchase in those terms it becomes much easier to just leave that item in the cart and walk away.
13. Consider Buying Used or Borrowing
Whenever we realize we need a certain tool or kitchen gadget for a specific project, it’s easy to find yourself logging into Amazon and placing a quick order. Two day shipping is pretty fast. But borrowing from a neighbor or friend can place that item in your hand in a matter of minutes!
Before buying something you only see yourself using a few times a year, try asking around to see if a friend or neighbor already has that item and are willing to let you borrow it. Not only could it deepen your relationship with your neighbors and strengthen the community, it’s also better for the environment!
Pro Tip: Try joining your local “buy nothing” group on Facebook! These are full of people who are happy to loan out their stuff, or are even giving it away for free.
14. Put It On A Wishlist
A great way to make sure you aren’t just responding to spending triggers is to put all non-essential purchases on a 30-day wishlist. If you still want the item at the end of the waiting period, you can go ahead and buy it, guilt free.
Just knowing that you’ve taken the time to consider the purchase and reflect on the value it brings to your life is at the heart of mindful spending! You’d be surprised at how many times you’ll opt to forgo the item at the end of the waiting period.
Pro tip: Some online deal sites have “watchlists” where you can be sent price alerts if the thing you want to buy lowers in price or goes on sale.
Mindful Spending Questions to Ask Yourself:
Don’t have time for the 30 day Wishlist? Try asking these questions before making a purchase to make sure you’re practicing mindful spending.
- What value will this item bring to my life?
- Who am I buying this for?
- What are the secondary costs of this purchase?
- How many hours of work does this cost?
- Why am I spending this money?
- Am I tired or stressed?
- Could I borrow this item or get it used?
- Can I afford this without going into debt?
The Bottom Line
While some might think that mindful spending adds restriction to your life, we would argue that it does the complete opposite! Mindful spending gives you the freedom to spend on things that actually bring value to your life. Without it, you may find yourself without money to spend on what’s important to you because your cash has already flown out of your bank account, and into purchases you no longer use.
Mindful spending allows us to avoid the temptation of thoughtless purchases because we are strong in our convictions and truly understand our values.
Hopefully we’ve convinced you to incorporate some of these mindful spending techniques into your routine! If you’re looking for even more ways to save, check out these 7 Ways To Save Money This Week.
**Photo by Edu Lauton on Unsplash
