1. Stop spending
There is always a loophole when it comes to my personal finances. No matter how much I budget, plan, or willpower I put forth, there is always somewhere that an extra large chunk of change goes. In my ever changing efforts to find a way to trim off those extra expenses I came upon something that worked wonders for me. I hate writing, especially checks. I have never enjoyed writing checks and I hate to have to write down the amount that I am spending because it forces me to think about every penny that I am getting rid of. Since I hate writing checks, I turned that around to my benefit by not using a debit card at all (I kept mine at home for months) and not carrying cash. I had to write checks all the time, and since I didn’t like writing checks I started writing fewer and fewer checks. I found something that I disliked more than how spending the money made me feel better. I instantly found that I had more money at the end of the month and it wasn’t for lack of trying.
Change happens when the positive stressor outweighs the negative stressor. I have been able to use this idea in other areas of my life as well. I flip flopped this idea to my advantage by finding a large negative stressor to prevent me from spending money. When you understand what you want to change, you can manipulate the positive and negative stressors so that you will choose the desired outcome with less effort than you thought.
2. Practice Saving
Before I went to college I decided that I was going to give myself a good gift when I graduated. What I decided to do was to get a large piggy bank (a 3 foot tall coca cola bottle in my case) and put all my change in it while I was in school. I did just that, all my change went into this piggy bank and I made myself never spend any of the money in it, just leave it there and watch it grow. When I finished college I took my piggy bank which now weighed over 20 pounds of mixed change to the bank. I ended up with $330 to go buy myself a gift. Now if your fresh out of college and used to getting by with very little, that is a lot of money. The lesson to get out of this was that I had a plan with a reward for completing my plan, and it was a realistic plan and reward. By having a plan and a realistic reward, I motivate myself to accomplish my goals.
3. Budget for Fun
It can be very frustrating and depressing sometimes when you are on a tight budget and having to spend all your extra cash just to get by. What I did to make myself stay on track more often was something I did as a kid. I gave myself an allowance and that money was just for me and I added it into my budget. That money was just for whatever I felt like with no guilt or strings attached. This really helped me to separate taking care of my financial situation and being able to actually have a life as well. I started off with trying a few different methods and ended up deciding a weekly allowance was better since this was a short term focused amount of money, it just made more sense to have it for a short term. Giving myself an allowance made things almost instantly better for me because all the weight was off my shoulders for every purchase. Instead of having my entire bank account to deal with and thinking through all of my bills and cash flow before a purchase, I had $25 dollars to waste on whatever this week and that was all that I had to think about.
I didn’t do all three of these things at the same time, I did one thing til I learned how to control myself and my situations that I put myself into. When I spent too much money, I turned to checks for control. When I was depressed for not having any to spend on myself, I gave myself an allowance. The whole time I was saving my change because saving through it all was an investment in myself and my future that I can turn into saving plenty for retirement and things to come.
This article was written by Clayton Collins who writes at his blog – Just Good Financial Advice.