It is the holiday season, so gift-giving is in style. Though great for family time, feasting, and leisure, this time of year is often when many Americans overspend. Below are practical steps to limiting overspending.
Humble Yourself
According to psychologist Brad Klontz, humans are “wired to overspend” because they have had to prioritize immediate needs for most of their time on Earth. Thus, modern humans must use more cognitive resources to fight automatic impulses to spend. Regardless of your view of evolution, one aspect of this is empirically true: humans naturally tend to spend impulsively.
So instead of expecting your impulses to disappear magically, prepare to fight against them. If you overeat chocolate, how can you stop if you don’t acknowledge the problem? Regardless of your financial status, accepting your weaknesses is the first step to overcoming them. Take a good look at your life, mourn the mistakes, then work for change.
While applying this is very humbling, accepting your financial faults as they are is crucial. The key is not to define yourself by these shortcomings but to learn from them. Recently, I realized that I didn’t stick to my budget and overspent on food. Seeing these expenses for the year humbled me. However, rather than defining myself by these faults, I have learned from them and started exercising more discipline.
Additionally, after acknowledging the problem, I have been resisting impulse food and drink purchases. When I have the urge to get an extra coffee, snack, or even meal I have been replacing that with meals at home and food I have already purchased. Lastly, seeing the magnitude of the bad habit at face value motivated me to take this seriously.
Form Different Habits
Think about it: You wake up every morning to brush your teeth. This small habit plays a significant role in maintaining your hygiene. Though it matters and prevents disease, it’s not something you need to think much about. This habit is one of many that sets you up for better health.
We also have financial habits, whether subconscious or conscious. Applying financial wisdom habitually sets us up for long-term success. For instance, update your budget at the same time every week. Learn about investing little by little. Show up every day, apply what you learn, and you will see improvements.
Embrace Financial Discipline
While gaining financial knowledge is one thing, actually applying it is another. True success requires discipline, and you can expect challenges along the way. However, focusing on the long-term goal can keep you motivated. If you are sick of your situation, that is the best time to change.
As Dave Ramsey wrote in one post,
“When you have an ‘I’ve had it’ moment, you’re about ready to change your life.” Changing your life is not an intellectual dance, or some kind of theoretical idea. You get sick and tired of being sick and tired. ‘I’ve had it!’ That’s when you change.”
Thanks for reading, everyone! We hope you have a great rest of the week! And remember, you can’t lose if you don’t pay!
Until Next Time!
– The Free Play Lotto Team!
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