If you’re struggling to pay your bills, have lots of credit card debt or can’t seem to save enough to build an emergency fund, then you’re probably spending more than you earn due to impulse buying. While it may seem like no big deal to splurge on a fancy dinner or new diamante-studded collar for your puppy, impulse buying is a source of serious financial stress for many Australians.
The remedy to this common issue is mindful spending, the practice of paying for products and services that you believe have long-term value and are in alignment with your goals. Thankfully, cultivating mindfulness when it comes to your finances is a skill that can be learned, no matter your age, job or bank balance.
What sets off your spending?
In her role as a financial therapist and co-founder of The Financial Wellbeing Company, Jane Monica-Jones supports people to repair their relationship with money. She believes everyone has different triggers for spending, and finding out what yours are is key to overcoming them.
‘If we are able to see our triggers and behaviours, then we are able to make a different choice,’ she explains.While everyone spends impulsively for different reasons, here are a few common triggers and examples:
- Stress – going to the casino after a hard day at work.
- Boredom – shopping online to pass the time.
- Social inclusion – saying yes to a group trip that you can’t afford.
- Low self-esteem – dining at fancy restaurants or buying designer threads to appear wealthy or powerful to others.
- Excitement – shouting a table of strangers a round of drinks because your footy team won a big game.
- Fear – buying way more than you need ‘just in case’ or accruing and hoarding ‘stuff’.
How to practise mindful spending.
Intentional spending is like a muscle: the more you use it, the stronger it is. Whether you have trouble controlling yourself at retail sales or are a sucker for bagging an online bargain, here are five steps you can take to rein in the behaviour and spend more mindfully.
1. Know yourself.
Jane believes the first step towards becoming a more mindful spender is developing self-awareness by learning what drives you or what triggers you.
‘Mindfulness starts with yourself. Then, you can start seeing how you act when you come into a relationship with the world,’ she says.
If the people in your social circle are prone to splashing cash on expensive dinners, clothing and holidays, it can be tricky to start spending more mindfully.
‘It takes a level of self-esteem, confidence and empowerment to say: ‘Actually, that is not who I am. I'm not defined by external factors. I'm defined by my own inner compass,’ she says.
2. Start small.
Instead of going in all guns blazing and setting yourself an unachievable target, Jane suggests taking baby steps at first.
‘Starting small is the best way to begin something positive in your life. Start by saving $20. If you're going to trim your spending on coffees, don't make it for the whole week. Just make it for one day during the week,’ she says.
Making minor tweaks to how you spend your money is more likely to lead to success than introducing radical, restrictive changes overnight.
3. Tie together new behaviours.
If you’re accustomed to meeting friends for a long (i.e: expensive) cafe brunch every Saturday morning, create a new ritual by meeting at the park to walk your dogs instead. Tying together two new positive behaviours (walking outdoors with friends and not spending money at a café) will give your finances and health a boost at the same time. Soon enough, you’ll feel great about your new ritual and look forward to it each week.
4. Wait it out.
If you’re wondering how to avoid impulse buying, then you’re not alone. Studies estimate that unplanned buys account for between 40 and 80 per cent of all purchases. But we’re not all doomed to buying things on a whim. There are a few tried and true methods of avoiding impulse buying. Enforcing a rule that you must wait 24 hours before buying anything (except essentials like food) will slow you down enough to reflect on whether you really need that item.
By the next day, you may have forgotten about that limited-edition watch altogether. Some people try challenges like ‘No-Buy July’ to break impulse-spending habits. By committing to buying nothing new for a month, you’ll walk away with some key lessons on how it feels to delay gratification (and a healthier bank balance to boot).
5. Hit the unsubscribe button.
If your inbox is clogged with emails from brands enticing you with flash sales, special offers and new product launches, then hit unsubscribe. Marketing emails encourage impulse buying with sweeteners like free postage and discounts, but ultimately, you’re being encouraged to buy things you probably don’t need.
Banish brands from your inbox and you’ll be less likely to click ‘buy’ impulsively. The same rule applies to social media. If you find yourself impulsively buying shoes on Instagram or make-up on TikTok, unfollow the main culprits to remove the temptation altogether.
Changing your relationship with money may take some getting used to. But before long, leaving a cute dress on the rack or declining a last-minute night out that you really can’t afford will become your new normal and leave you feeling in control.
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This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.