Answering Your Questions About Gift Giving & Grocery Shopping (YMM, Ep. 5)
Credit Cards: Great for Travel or Bad for Debt? Or a bit of both? (#YMM, Ep. 6)
7 Ways to Break the Impulse Shopping Habit
Have you joined the FREE 5-Day Jumpstart Your Budget Challenge yet?
On Day 1, I talk about being “all in”, and I ask you to let me know what your biggest challenge is to really being ALL IN with your budget. I’ve received over 200 emails so far (amazing!) — and the most common answer I hear is the one I address in this post: Impulse shopping!
If you struggle with impulse shopping, I’m reprising this post for you.
Do any of these scenarios sound familiar?
- You go to Target with a list of four things, but end up with a full cart.
- You’re at the mall to pick out a child’s birthday gift, but the sale sign at Nordstrom draws you in.
- You walk into Costco for milk and eggs, and somehow walk out with a $200 bill.
- You love getting a bargain, but spend money you don’t have just to score a “great deal”.
- You experience feelings of guilt or “buyer’s remorse” after shopping.
What do all these scenarios have in common?
Impulse shopping!
By definition, anything that isn’t planned is an impulse.
Now, impulses aren’t necessarily bad – and I’m all for embracing your inner free spirit.
But when left unchecked, impulse shopping is the fastest way to blow through your budget and get off track for your long-term financial goals.
Even if you can “afford” the unplanned splurges in the short-term, those purchases may be derailing you from saving for your future.
After all, even if it’s “just” $25 a month of splurges, saving that same $25 a month would net you more than $19,000 in 20 years. (Assuming a 10% rate of return.)
But math alone isn’t going to be enough to break the impulse shopping habit for most people — I know it wasn’t for me! So here are seven strategies to help reign in those unplanned purchases.
#1. Avoid your triggers.
Do you know you can’t get out of Target without spending $100? Then avoid Target until you feel more in control.
Are you a softy for the clearance racks? Then avoid “eye contact” and walk the other way. Sure, you’ll miss out on some 70% off doodad, but that savings won’t feel like much of a blessing if you’re trying to kick the impulse habit.
Or have you noticed, as I have, that you can easily spend $20 more than you normally would when your kids come shopping with you? Try to shop at night or on the weekends. Or better yet, have your husband do the shopping (assuming he doesn’t also struggle with impulse shopping!).
There are mood triggers, too. Many shop when they’re feeling down, while others shop to reward themselves. These triggers can be very subtle, and may require some soul searching to identify.
#2. Make a mantra.
It goes without saying that you must bring a list with you into the store, but if you find that even a list doesn’t stop you from going “rogue”, try having a mantra, too.
Even something as simple as, “Today, I’m only going to buy lettuce, milk and pasta” can help. Then, when you find yourself slowing in front of an endcap to check out the specials (a possible “trigger” for you), repeat this little mantra to yourself. Say it aloud if you need to!
#3. Plan for your splurges.
I know, it seems like an oxymoron, but if you know that splurging is your thing, go ahead and build that into the budget. At my house, we call it “blow money” – and it gets its own line item in our budget.
Blow money gives you the freedom to splurge, but with the peace of mind that you’re not undermining your family’s finances.
As an added bonus, blow money can also reduce any marital conflict you might have over money. While this subject is a much bigger issue than I can adress today, I have found that blow money is good first step toward calming those waters.
For example: Let’s say your husband wants to upgrade his iPod, but you think it’s a waste of money. “Your current one works just fine,” you tell him. Rather than get into a knock-down drag out fight over the iPod, he can use his blow money. As long as he doesn’t exceed the blow money “budget” the two of you have agreed on, there’s no need for conflict.
By the way, even if you’re not married, I think blow money is super awesome for the first reason alone!
#4. Shop online.
Everyone’s different, but online shopping has been hugely beneficial for me. And not just because it gets shipped right to my door!
I’ve actually noticed that I’m much less likely to make impulse purchases when shopping online vs. in a store.
When I shop online, I don’t “window shop”. I go to a site with a specific goal in mind (eg. buy new shoes for my daughter). Even if I get tempted to add some other items to my online shopping cart, I can close the window, walk away and evaluate.
The experience of shopping in a brick-and-mortar environment doesn’t give me this same breathing room. And even if I pay a bit more for an item online than I would in the store, I’m ultimately saving since I’m avoiding those extra impulse buys at the check-out counter. (See my More Money than Time post for an example of this.)
#5. Give it time.
If you find yourself in the store, or online, about to buy something you hadn’t planned, take a deep breath. And put the item back.
Then tell yourself that if you still want it in ___ hours (I like to do 24 hours, but even 2 hours will probably be enough to cool your heels), you can go back and get it.
This cooling off period allows you to regroup and reevaluate, once you’re out from under the spell of the urge.
(If you’re afraid the item might sell out, bring it to a sales member and ask them to hold it for you.)
#6. Ask for help & support.
Weight loss experts extol the benefits of having a buddy to go thru the journey with. Breaking the impulse shopping habit requires the same support.
Call your buddy when you’re standing in the store about to buy a $30 gadget you had never even heard of 5 minutes earlier. And call them again when you put that gadget back and walk out of the store proudly with only the items you planned to buy!
(If your impulse shopping veers more toward compulsion, you may want to seek professional support as well — especially if you find that you are maxing out credit cards and hiding purchases. According to this 2006 study from Stanford University in the American Journal of Psychiatry, about 6% of both women and men are compulsive shoppers.)
#7. Shop with cash.
Have you read the studies that say McDonald’s consumers spend an average of $7 when paying with credit cards vs. $4.50 when paying with cash?
While McDonald’s may not relevant for most KOABers, but the underlying lesson is: Spending cash hurts. Swiping a credit card doesn’t.
Credit cards are so removed from being actual money that it’s far, far easier to justify a splurge when you’re swiping. If the first six strategies don’t work for you, try taking the cards out of your wallet and replacing them with cash.
Have you struggled with impulse shopping? I’d love to hear about your strategies for fighting that urge!
Your Money Monday | Dealing with Unexpected Expenses
Welcome to Your Money Monday. Your Money Monday is going to be a series of posts all about YOU and your MONEY! And, duh, I’ll post these on Mondays!
(If you follow me on IG, you may already know about YMM — I used to do little IG TV spots back when IG TV was a thing.)
Here’s the idea behind YMM: I want us to talk frankly and honestly about the subject of money because I firmly believe that EVERYONE (except for maybe the Jeff Bezoses of the world) have money stuff that they worry about.
And without a doubt, the one thing that makes these worries — no matter what they are — worse for every.single.one of us is shame.
Shame is what happens when we look around and think: We’re the only one struggling with this issue. We’re the only ones who can’t figure this stuff out.
As if the money stress itself wasn’t bad enough, now we’re thinking we’re alone in it.
Except, guess what? That’s 100% not true. I guarantee it.
By being open with you guys over the years about some of my own money struggles, I’ve become somewhat of a safe space for others to share their money struggles. It’s been my honor to hear from many readers over the years who are struggling.
While I don’t always have the perfect answer for them, I can offer a promise to each person who emails me and that is this: You are not alone. You are not the only one.
Your Money Monday is my attempt to light a match in the dark room of money stress. Only this room isn’t darkened by an absence of light, but rather by a curtain of shame. And the moment we talk about this stuff, we start to raise that curtain and dissipate the shame.
Today in YMM I want to address the topic of unexpected or unplanned for expenses. Think car repairs, dental visits, or even a letter from the school that you owe $100 for some upcoming field trip.
These kind of unanticipated expenses can throw any household into a spiral. But they are especially perilous if you are one of the millions of households living “month to month” — meaning your income is just enough or maybe even not quite enough to cover all your monthly expenses.
Side note: You can have a “low” income and live month to month, and you can have a “high” income and live month to month. If you make a “good income” but can’t seem to “get ahead”, it’s probably because you are living month to month. This is especially common in families that are carrying a good deal of debt (meaning student loans, car payments, personal loans, etc.).
One of the best things about budgeting for me is that it gives me really good insight into our money patterns. I’ve been able to see that what I thought were expenses coming from left field are actually, in many cases, quite predictable.
Take last week, for example. We brought in our car for its annual pre-test check-up (in Israel, you have to pass a car inspection each year before you can renew your registration).
Usually it’s just a matter of swapping out some filters and maybe popping on some new brake pads. But this year, the mechanic discovered that we had an oil leak which had been going on for a while apparently — and had done a number on the gear box and several other engine parts, too.
Oh, and the rear brakes needed to be replaced. And the timing belt.
The bill was high. I mean, seriously high. $2500 high. Gulp.
If this had happened to us ten years ago, we would have been in big trouble. We didn’t have $2500 to spend on car repairs. We barely had $250 to fill up the tank each month.
But thanks to budgeting for oh-so-many years, I’ve started to see the pattern: like it or not, car repairs are a reality of car ownership. (And rest assured: I do not like it. But at least they don’t catch me by surprise anymore.)
No, I don’t know when the big one is going to come. Or how much it’s going to be. But I do know: You own a car, you pay the piper.
So instead of enter-panic-mode or max-out-credit-card — my two previous go-to-moves for dealing with unexpected expenses — I now set aside $150 each month to deal with car maintenance & repairs.
It’s like an emergency fund, but for my car. I call these pre-emptive set-asides my sink funds, and they help us to pay for all sorts of previously unexpected expenses.
(And another YMM tip: When the amount in my sink fund isn’t enough to cover the whole $2500 — because that’s a lot of money! — I tap our actual emergency fund to make up the difference.)
Not only do my sink funds help me to pay the bills, they also keep me from spiraling from a dispiriting trip to the mechanic into a major financial crisis.
Do I relish having to spend $2500 on car repairs? No, I do not.
I’d much rather have saved that $2500. Or gone on vacation with it. Or, I don’t know, bought groceries. But thankfully I no longer have to borrow from our future vacations, or our grocery budget, or my dad (all of which I’ve done in the past!) to pay that car repair bill. Because now we “sink” those funds in advance.
If you find yourself struggling with unexpected expenses, I want you to know two things:
(1) You’re not alone. It’s not just me with the car bill. I am certain that at least 9 out of 10 people reading this post have had an “unexpected expense” of their own this month!
(2) The best solution — practically and emotionally — that I’ve found to deal with these types of expenses is to start by identifying your money patterns and then set aside enough cash to deal with them when they happen again in the future.
If you’re not sure where or how to get started, ask yourself:
- What expense did I have this month that was unexpected?
- How often does this type of expense pop up?
- What’s a reasonable amount of money that I might need to cover it the next time it pops up?
- How much do I need to set aside — aka “sink” — each month so that I’ll have enough to cover it the next time?
We can’t control all the variables. Even the best budgeter will be caught off guard on occasion. But by observing your money patterns and taking preemptive steps to deal with them, unexpected expenses will be fewer and further between.
Which hopefully means that you will be able to prevent those downward spirals.
Got a YMM question? Want to chat about money? I’m here! Comment or shoot me an email!
Your Money Monday | Banishing the Monsters in the Closet
Welcome to Your Money Monday, a series of posts in which I talk frankly and honestly about the subject of money because I firmly believe that EVERYONE (except for maybe the Jeff Bezoses of the world) has money stuff that they worry about.
And without a doubt, the one thing that makes these worries — no matter what they are — worse for every.single.one of us is shame.
Shame is what happens when we look around and think: We’re the only one struggling with this issue. We’re the only ones who can’t figure this stuff out.
As if the money stress itself wasn’t bad enough, now we’re thinking we’re alone in it.
Except, guess what? That’s 100% not true. I guarantee it.
By being open with you guys over the years about some of my own money struggles, I’ve become somewhat of a safe space for others to share their money struggles. It’s been my honor to hear from many readers over the years who are struggling.
While I don’t always have the perfect answer for them, I can offer a promise to each person who emails me and that is this: You are not alone. You are not the only one.
Your Money Monday is my attempt to light a match in the dark room of money stress. Only this room isn’t darkened by an absence of light, but rather by a curtain of shame. And the moment we talk about this stuff, we start to raise that curtain and dissipate the shame.
Without disclosing any identifying information, I want to share with you (with my clients’ permission) a brief story from a couple whom I worked with over Zoom a couple of months ago.
They came to me because they were really struggling with what the wife had called “over-spending”.
I reassured them that this is quite typical. “Lots of people have leaks in their budgets, you’re not alone.”
“No, Mara. Not leaks. Leaks are little and annoying,” my client corrected me. “We don’t have leaks. We have floods.”
She went on to explain that they owed so much money, but she didn’t even know how much. When we tried to make a list of how much they owed — and to whom, they both kind of shut down (also very typical).
“It’s like we have monsters hiding in our closet,” the husband told me.
Oh, how I remember that throat-crushing feeling.
It’s horrifying. You’re doing everything you can to keep all the balls in the air, I recalled: But then a bill comes in the mail that sends you into a tail spin.
If you can’t relate to this monsters-in-the-closet feeling, then I am so, so happy for you. It’s awful.
But if you are struggling, drowning under what feels like a flood of debt and financial disorganization, let me share with you the advice I gave them.
This is what my husband and I did when were in this same spot — and it was, simply, life-altering. (And also a little ugly.)
We made a complete list of every dollar we owed, and to whom we owed it.
It took a while (the better part of two afternoons) to get it all onto paper. But once we had faced it, and had a very long list, with too many zeros on it, believe it or not, we actually felt better. It’s really true what they say: Knowing is half the battle.
If you want to banish those monsters, the best thing to do is shine the spotlight on them.
Gather up every single bill you can find. Credit card bills, student loans statements, personal loan statements, medical bills, store charge accounts, and any bills you’re behind on.
Pile it all up on the kitchen table, pour yourself a piping hot mug of tea, and dig in.
I went old school when I did this: pen and paper. That made it more real for me. But if you’d rather do it on your computer or phone, that’s fine, too.
Open each bill, write down the name of each debtor (Visa Card, Electric Company, etc.) and the total balance due. If a bill has a minimum payment option, make a note of that, too.
Do this over and over again, until you have emptied every envelope.
Now take a deep breath and grab your calculator. It’s time to tally it all up.
Working your way thru that tally to pay off all your debt will take time, sacrifice (I know it’s not a fun word), and commitment. But from this moment forward, you are in control. And there are no more monsters in your closet.
Got a YMM question? Want to chat about money? I’m here! Comment or shoot me an email!
