Shopping provides comfort and joy to many consumers. Americans have a shopping addiction. In fact, 84 percent of all shoppers have engaged in impulsive purchases at one point. However, with most shopping addicts having an annual income of less than $50,000 a year, many are in search of ways to save money.
If you’re looking for ways to curve your shopping impulses, you’ve come to the right place! This article will highlight 5 ways you can stop overspending on impulse buys and say yes to saving.
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1. Make a budget and stick to it.
However, before you can move forward with saving, you need to take a hard look at your current financial status. Look at debit and credit card statements, along with cash receipts to fully understand where your money is going. Start by breaking your purchases into two main categories: essential and non-essential. Your essential spending will include subcategories you can’t live without — rent, gas, food, etc.
Non-essential spending categories include gym memberships, magazine subscriptions, clothes purchases, grooming, music downloads, etc.
Total up the amounts in each category.
Your largest non-essential line items are the ones you should tackle first and try to decrease future spending.
2. Give yourself permission to spend.
Next, look at all your income. Be sure to include any anticipated student loan refund checks, allowances, rental income, side hustles, and child support payments.
You want to have a full picture of how much money you’re bringing in. You can use tools like Personal Capital to help you with this.
After you total your income, compare this number to your total expense budget.
Are you spending more than you make? For most, the answer is yes. To determine how much money you truly have to spend on your impulsive shopping, take your total income and decrease it by your essential spending total.
This number is called your discretionary income.
Total Income – Essential Expenses = Discretionary Income
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In order to start saving, your non-essential spending must be less than your discretionary income. The following tips will highlight how you can accomplish this goal.
3. Stop carrying debit and credit cards.
Debit and credit cards provide convenience for the everyday shopper. According to the US Bank Cash Behavior Survey, 50 percent of respondents reported carrying cash less than half of the time. However, ditching your plastic can have huge returns when you’re trying to save money.
Use the envelope method to keep track of your non-essential spending. Think about each of the categories listed under non-essential spending. Create an envelope for each. In order to save money, determine how much you can afford to spend in each category. At the beginning of each month, put your budgeted amount in the corresponding envelope.
This is the money you will use to make your everyday purchases. When you run out of funds in the envelope, you can’t buy anymore! This is a simple method that requires discipline in order to work. At the end of the month, any money left over goes into savings.
4. Unsubscribe from retail email and mobile subscription lists.
Retailers have a way of playing on shoppers’ impulsive behaviors. How many times were you sitting at work and received an email notification that your favorite store was having a 24-hour sale? What about a Happy Hour 50% off sale? Oh, and can’t forget about free shipping if you spend more than $50! All of these promotions are ways for retailers to entice shoppers into thinking they’re receiving a deal in exchange for their purchase.
If you’re an impulsive shopper, the best way to not give in to the pressure is to remove yourself from all email and mobile subscription lists. Out of sight, out of mind. If you aren’t being bombarded will sales messaging, then you are less likely to spend your discretionary income on these items.
5. Use the 24-hour rule.
Our final tip is one that requires commitment. Most impulsive shopping is coupled with a fleeting thought that most give in and fulfill. Before making any non-essential purchase, wait 24 hours.
If you still feel strongly about making the purchase, then go back to the store to buy it. You will be surprised how many items you never think about certain items again. The 24-hour rule combats our impulsive nature and forces us to think before taking action. It can be applied in a variety of ways to help with wise decision-making. As you see your non-essential spending decrease, you should also see an increase in savings.
Remember This Before You Impulse Buy
Although these tips will provide you with guidance as you try to save money, it all starts with your willingness to make changes to your financial habits. It is okay to make a few impulsive buys as you start your journey toward saving.
As you make steps forward (and sometimes backward), find a friend you can talk with, who will help keep you on track toward reaching your savings goals.
Also, keep up with financial blogs like My Millennial Guide, which will help keep finances top of mind.
Finally, why not save money when you can? Giving Assistant can help. Check out Giving Assistant today to browse all the latest deals and discounts to your favorite stores.
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