So, it caught your attention to express my thoughts on financial self control and discipline.
That shimmering red dress suddenly popped up on the left corner of your screen. It looked gorgeous. Ignoring it, you tried to focus on the spreadsheet before you. But the lure of the dress proves too much, and you click on the image. It takes you instantly to the amazon site where it’s going for a “sale” at $100. You hover the pointer over the “buy now” button, and after a moment’s hesitation, you click.
But did you really need that dress?
You are not alone. Several times a day, we are tempted to spend on things that we don’t necessarily need. According to invesp.com, about 54 percent of US shoppers spent $100 or more on an impulse purchase. Also, they make up 40% of all online purchases.
While it’s exciting to click – credit card in hand, on the latest shiny object that attracts your attention, impulse buying wreaks havoc on your wallet. And it’s one of the more significant poor financial habits which keeps you from achieving your money goals.
At the root of impulse buying and other unhealthy financial habits is a lack of discipline.
Learn to control your spending in the Financial Self Control, and you have done over 80% of the work required to fix your finances. But it’s never easy to break the chains of the short-term gratification built over time. You have gotten used to the easy pleasure of getting what you want when you want it
Hopefully, by now, you’ve seen the consequences of a lack of self-control. A purchase here, a night out with friends there, and the occasional diner at the fancy restaurant, all seem like a small amount at the time. But over time, these add up, and you’ll wonder where your paycheck goes every month. You have not made much progress towards your goals, and you’re probably neck-deep in debt.
You know you have a financial self control problem. And the solution is a plain old discipline. Without a fair amount of financial control, you’ll always struggle whether you earn $20,000 or $500,000 a year. Becoming intentionally disciplined over your spending is tough. It will require you to make lots of changes, but it’s essential if you are to regain financial freedom.
And here, you’ll learn some strategies to tackle your lack of self-discipline head-on. The practical and straightforward tips listed here have helped me and several others develop discipline and regain a grip on my finances. You will be glad you tried them out.
Set A Goal
If you don’t know where you are going, it would be much harder to get there. The first step to conquering your self-defeating lack of discipline is to set a financial goal. The problem with setting financial goals is that most people believe it’s too tasking. Or you may have set goals in the past and didn’t follow through for some reason.
It may help to make your goals as simple as possible. Think of some worthy objective for your money and make it your mantra. With this goal in mind and a timeframe, you can determine how much you need to set aside from your paycheck each month to meet your goals. It could be saving up for a down payment for a home, paying for your child’s college education, or saving enough money for your retirement. Picking an objective you feel strongly about will help you muster the needed willpower to slow down on impulse spending and plan your finances better.
Question Every Purchase
Learn to ask yourself hard questions before every single purchase. Do I need this to live? Can I do without this item? If the thing is essential to your survival, then ask -is there a less expensive option or alternative?
You should ask yourself this question about every purchase you’re about to make. About every product you throw into your shopping cart – online or offline. If the item in question isn’t essential for your survival, then know that buying it will only set you back on your journey to financial freedom. If you really need the item, then find out if there is a less expensive option that will render the same benefits.
Putting this into practice will help you develop the habit of considering the negative consequences of your impulse spending. It will become easier to say no to things that do not serve your long-term goals. Self-control grows when you can now decline purchases that you would have quickly made without a second thought previously.
With every penny you’re about to spend, always ask, “Is this necessary for my survival?” Every time. Consistently. And like a muscle, your self-control grows with each intentional consideration.
Draw Up A Budget
Unlike a shopping spree, there’s nothing glamourous about a budget. But if you must get a grip o your finances and become disciplined, a budget is absolutely needed.
A budget will help you define your money goals, identify what you need to achieve them, and prioritize your expenses accordingly. You can now regulate your spending and avoid costs that do not fit in.
Creating a budget compels you to scrutinize your spending habits. You’ll notice all the frivolous items you spent good money on. Do you read all the 30 paid magazine subscriptions? Are 15 grey t-shirts not too much? Budgeting will help you realign your financial goals.
Of course, you’ll be momentarily saddened that the latest iPhone or the lovely pair of Nike Air force doesn’t have a place in your budget. But when you remind yourself that you are delaying instant gratification for a worthwhile goal – a new house or fat retirement savings, you’ll find it easier to close the tab or leave the store empty-handed.
Track Your Expenses
If you don’t devise a means of tracking your spending and knowing where your money goes, it won’t be long before you feel you’ve lost control.
It’s one thing to draft a budget, and quite another to stick to it. Tracking and monitoring every penny that leaves your pocket carefully ensure you stick to your budget like a barnacle to rock. Luckily, tracking your spending doesn’t have to be complicated or time-consuming. Although you can use the good old spreadsheet or a pocket notebook, several apps exist that make expense tracking a breeze. These include YNAB, Quicken, and Mint, among others.
Whichever method you choose, the objective is the same: record and categorize every dime you spend. And then review them to know the areas where you tend to overspend. The review will let you see that you actually spent more in some categories than you thought you did.
Carefully think about the areas where you spend the most money. Is there room to cut back on them? In most cases, you’ll find that you can reduce spending in such categories or totally eliminate them, and it wouldn’t matter at all.
Ditch The Plastic
Since you don’t part with cash when you pay with your credit or debit card, it often doesn’t feel like real money. Once the transaction goes through, your mind abstracts it, and you don’t feel as if you spent anything.
Fueled by a lack of self-control, this often spells disaster. A swipe here and a swipe there, you won’t realize how much you’ve spent till you discover that your minimum credit card repayment bill is on the high side. The consequences are an increased debt load, which could take you years to pay back, effectively derailing your financial plans.
On the contrary, when you pay with cash, you will feel your hard-earned money physically leave your hands, and you’ll be more reluctant to let it go. Ditch your credit card for a while and use cash only for spending.
Cash also makes budgeting easier too. When you have exhausted the cash allocated for a category of expenses, you don’t spend any more on that. You’ll find a way to make it till the end of the month and use that experience to spend more carefully in the future.
Avoid using your credit card until you’re in the clear and have learned how to curb your appetite for frivolous spending.
Flee From Temptations
You should know your triggers and avoid places that will make you spend on stuff you don’t need. This could be shopping malls or online sites like Amazon. Or going for happy hour drinks with friends on a Friday night.
Unsubscribe from online store emails and keep away from shopping sites when browsing the internet. By avoiding the places where you’re tempted to spend money, you won’t have to struggle against the urge to spend, and you’ll keep more of your money where it could serve you better.
Conclusion
It’s human nature to want to gratify desires instantly. Choosing long-term gratification is harder, but it’s always the better choice. Financial self-control is the super-power you need to develop to always choose long-term gains over short-term pleasures.