How To Change Your Spending Habits

Yesterday I posted a piece about being willing to save for an item if it’s what you really want, rather than buying a cheaper item by default. I posted a link to the article on Facebook where Cheryl Stafford Ferguson wrote the following comment:

Don’t want the more expensive one just because it is more expensive.
More expensive is not necessarily better quality.

Cheryl is absolutely right. Just because an item costs more, doesn’t mean it’s better quality.  The true nature of savvy spending is in questioning every purchase.  Is this an item I should invest in or should I bargain shop?

Her post reminded me of a conversation I had last week with clients who, previously, never had to worry about money. Now that they’re in retirement, they’re having to be mindful of their spending to ensure they don’t outlive their money.

They asked me how to become more conscious about their spending. Before, if they wanted something, they’d just buy it and never look at the price.

I suggested two books for them to read. One is, The Power of Habit by Charles Duhigg and the other is What Would A Wise Woman Do by my friend Laura Atchison.

Both books talk about how so much of what we do in any given day is out of habit, including the questions we ask and the decisions we make. If you’re trying to change your financial situation and your making decisions based on your old habits, your situation is not going to change.

If you can break out of the fog and become conscious of the spending decisions you make, from a pack of gum to your next car, you can change everything.

One of the things The Power of Habit explains is the need for a trigger to implement a new habit. So, if you want to be more conscious about your spending, something as simple as putting a post it note on your debit or credit card with the words “spend smart” will be the trigger you need to ask yourself the right questions before making your next purchase.