I have said before, the greatest indicator of your future wealth is your cash flow and how much you’re saving. It’s hard right now… here in Seattle, with the quarantine, lots of people didn’t make a lot of money, so they are playing catch up. Others might have had job security but were stressed out with juggling EVERYTHING at home. Just like I gained a few pounds in quarantine, people might have gained some unwanted financial results in quarantine. Maybe some debt, maybe some bad spending habits… it would be different for everyone.
It doesn’t matter how much money you make – we all struggle with this. It’s hard to know if we’re spending too much, and unfortunately, if you’re not able to save consistently, you probably are. And maybe when you’re out of work or getting back on track, it isn’t the perfect time to try and fix the savings side of the equation – but you can get clear on what it takes, exactly, to make things work in the short term.
You know when you’re probably coloring outside the lines with your spending – just like I know when I am playing fast and loose with my healthy eating plan. I am talking about those moments when you’re not even thinking, or feeling too busy or overwhelmed or whatever, that you don’t consciously make a choice, you just do something so you can move forward. Unconsciousness causes people to overspend, there is no way around that. And when you’re experiencing stress the way we have the past several months, it’s a comforting coping mechanism…but eventually, you’ll need to find another one.
When I get to feeling like I am too disconnected from what is happening around my spending, I go on a spending diet. I always tell my clients, I can stay on track with reasonable spending 80% of the time. And that is sufficient to reach my financial goals. What that means though, is a few months of the year — typically August and December, when I tend to take more time off and see loved ones — I spend well above my average.
If I want to enjoy those months, then it helps to be uber conscious about what my normal-month spending is, so I can start to work that muscle memory… it’s your conscious spending muscle. When you’re super clear what behaviors constitute a “good spending” month for you, your consciousness starts to notice when you’re deviating from that, so you can course-correct more quickly.Lack of consciousness causes people to overspend. And when you’re experiencing stress the way we have the past several months, it’s a comforting coping mechanism...but eventually, you’ll need to find another one. Click To Tweet
What does a spending diet look like?
My “spending diet” month, then, closely parallels what I am also doing health-wise… getting back to healthy eating plans, cutting out sugar and white flour, committing to my workout schedule again. I find that I can make specific commitments for money in that month – after an excessive spending month – that I don’t necessarily need to keep (or even want to keep) up for 12 months at a time, but the break “resets” my brain back into my normal routine.
For the next month, then, I am committing to:
- Better grocery shopping and meal prep. I already acknowledge that cooking just doesn’t happen on weeknights. Sure, I can assemble a salad, or heat up leftovers…but I know there will likely be a night or two I order takeout. When I am trying to cut back more, I keep all of the ingredients on hand for a BLTA sandwich, or I get a Beecher’s Mac and Cheese out of the freezer. Both of these options are actually MORE exciting for me than takeout food, and I save money.
- Only buying normal, everyday things I need to live and work. This means that I will pay regular monthly bills and grocery shop, but pretty much anything else I see that I want, I have to put it on a list and see if I still want it after my 30 days are up.
- Entertaining myself inexpensively. No new Kindle books (only library books). I even commit to no movie rentals because there are so many free ones on Netflix (to which I already subscribe).
- Amazon hiatus. Sorry, Amazon… For one month, unless it falls under the category of regular expenses, I put everything I see at Amazon on the Wish List. (You would be surprised what you don’t remember putting on there when you look at it after a month!).
- Online shopping hiatus. And not just Amazon… Why go virtually window shop when you’re not planning on buying anything? I just keep a list of things that I think of (usually on my iPhone so I can add to it at a moment’s notice) and when the month is over, I buy what I still want/need.
- Reviewing self-care. I typically get a pedicure about once per month, because I find them very relaxing. But it’s no big deal if I don’t, and I don’t mind going without sometimes, if it honors a higher ideal, like getting back on track and recommitting to healthier spending patterns. For example, my pedicure appointment this month would fall on the last weekend of the month — so there is no reason why I can’t just move that over to the next weekend in the next month. That is a zero sacrifice option.
And P.S., if it does feel like a sacrifice and it’s a part of my regular, monthly schedule, I keep the appointment. This isn’t about sacrifice, this is about resetting your brain to remember that you were happy on your regular routine, before your month of excess.
Coming out of it…
Once your spending diet month is over, you want to be sure and put an end to it! This isn’t meant to go on forever. But I love it as a return to consciousness. And I love to check out my Mint tracking and compare my spending to the previous month.
As I wind things up and loosen the spending reins a bit, I ask myself:
- What did you NOT miss that you thought you would? Whenever I tell myself I can’t buy books, it feels hard… But after a month of keeping myself busy with library books and borrowed books, I realize most of my issue is in my head.
- What were your triggers to WANT to spend more money and how did you cope? I tend to spend more when I am tired or stressed. Those feelings aren’t going to ever go away, so I find distractions and alternate behaviors. I also don’t expect them to work 100% of the time!
- What do you think is sustainable going forward? During one spending diet, a friend and I discovered we actually preferred dinner and wine, sitting on my couch and hanging out, over the upscale dinners we used to plan. It was nice to realize our friendship is more about connection than trying the latest hot spot.
Of course, your mileage may vary! This is as much about discovering how this new way of spending feels for you as it is about reining in your cash outflow. For more information about creating a long-term spending plan, check out my post about conscious spending instead of budgeting.
P.S. I have more conscious spending and spending diet resources in the library! You can get those downloads here.