“If you don’t have money, don’t buy anything.” Seems like a simple mantra, right? So, why is it so difficult for us to stop spending?
The good news is that it’s not just you who cannot stop spending. The bad news is that you are 100% in control of your actions.
Spending has become a psychological issue for most Americans. We envision our dream life and get frustrated when someone tells us “NO”—even ourselves.
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The roots of consumerism. We live in a capitalist nation. The urge to make money helps society push towards solar cars, more energy-efficient buildings, and thinner TVs.
However, 70% of the US economy derives from consumer spending. We are massive targets for corporations and small businesses who want our money.
We don’t have to give anyone our money; we can focus on saving money and building wealth.
But, we tend to concentrate on the latest cars, home renovations, shoes, and jewelry. Surely, there’s a reason that we all tend to overspend.
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Financial education vs. consumerism. Before we learn to budget, we learn to spend. This simple truth causes years of financial pain and anguish.
I’m watching this play out with my 17-year-old son right now. He just got a job and has started to spend on little trinkets and gifts for himself and his girlfriend.
Without the proper education, we get into credit card debt in a couple of years. This is a critical time for him; he must learn to stop wanting and start saving.
I made the same mistakes. Luckily for him, I learned from my lapses in judgment and turned my financial life around.
Now, it is incumbent on me to share “the information” with him. Whether he follows my advice and guidance is on him—at least he has the knowledge and resources.
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The US economy needs us to be in debt and overspend, which is the hard-hitting truth. Without rampant consumerism, we would have to change the entire economy to focus on responsible things like saving and investing.
How to overcome the urge to spend? The most challenging part of achieving financial freedom is overcoming the desire to spend.
How we spend money has become an addiction, like eating, drinking alcohol, gambling, smoking cigarettes, and doing drugs.
We must take the same drastic measures to stop spending. Everyone will have a unique way to curb spending habits, but let’s review a few.
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1. Cut up your credit cards. You can cut up your credit cards and remove them from your online storefronts like Amazon.
About ten years ago, I removed my credit card information from my Amazon account and my video game consoles. I had to enter the information for each purchase; this was the start of controlling my spending.
2. Use a cash system. Some people use envelopes and cash to avoid overspending. When your envelope runs out of money, you stop buying things.
This system can work miracles; however, the world is becoming increasingly digital. Some vendors don’t accept cash, so this method may be outdated.
3. Budget down to the nitty gritty. I call this “hardcore budgeting.” With this method, you use multiple tiny budgets to ensure you track everything you spend.
Let’s say you give yourself $300/month for eating out. You can create sub-budgets for gas stations, fast food, and fine dining.
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Ideally, you would have a separate checking account and debit card for each budget. This method forces you to focus on where your true joy lies.
If you love to stop at the gas station daily for coffee and a donut, avoid going to fancy restaurants. Everything “comes out in the wash” with a hardcore budget.
4. Follow a daily budget. Instead of using a hardcore budget, you can use a daily one. A daily budget allows you to spend as you choose but under one umbrella.
I have $750 per month for my daily budget, which equals $25 per day. Sometimes, I don’t spend any money; other days, I spend $100.
It doesn’t matter as long as I track my spending on my daily budget spreadsheet. If I want to purchase a $60 video game, I must “save up” over a few days.
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This method helps keep everything in balance. You can make major purchases and balance them by staying home for a few days. This is my favorite method.
Increasing your discretionary income. Budgeting and saving are great, but making more money is even better. If you love to spend, you should love to work.
There are many ways to make more money, but I recommend building passive income streams from dividends, rents, and royalties.
My Happy Cash Flow Retirement series covers my thoughts on creating a passive income lifestyle. I am living this life right now, and it is truly amazing.
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Changing friends and social circles. Once you decide to reduce your spending, you’ll find that your friends won’t get on board.
You see, we surround ourselves with people like us. If we love to spend frivolously, we don’t want to be around responsible savers.
Don’t be surprised if you start to lose friends as you become the “boring” person in the group. Why make coffee at home when you can go to Starbucks every day?
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You’ll have to find a deeper purpose than saving money to take this journey. Why do you want to save, what do you want to achieve, and who do you want at the finish line? What is your rich life?
Conclusion. I took the journey to financial freedom, and it completely changed my life. I don’t have an urge to spend without reason.
I still go to restaurants, but it is to spend time with friends and family—not just waste time and money.
If I want to go to Applebee’s and only have $20 in my budget, I can go to McDonald’s. I have no shame in saying something is out of my budget.
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It’s okay to shop at Ross, get a hot dog from the gas station, and keep your cell phone for five years. You have a budget to follow, which will help you grow beyond anything you can purchase.
Overspending is the American culture, but you can overcome financial adversity. It starts with a mindset to succeed.
Then, use a budgeting or control method that allows you to curb your spending over time. Eventually, random urges will go away unless they fit into your budget. That’s the sweet spot. Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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