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Practicing Mindful Spending With Your Tax Refund
Do you usually receive a tax refund? Practice mindful spending to stretch the funds further. Here are examples of how you can put it into practice.
Let’s be honest. You’re here because you have a habit of spending a little too much. We get it; that’s why we put together our top tips on how to trick your brain into spending less money — without forcing you to go to extremes.
Everyone knows the iconic Parks and Recreation line “treat yo’ self.” We mean it a little differently here. To curb your purchases without having to restrict yourself, experiment with making a purchase a reward for completing a task or achieving a goal.
Let’s say that every morning on your way to work, you can’t resist buying a $5 latte. Let’s also say that you really want to start working out every morning. Now, create a reward system for yourself.
If you work out five days of the week, you can buy your go-to lavender latte the following Monday as a reward. If you miss a day, you can’t buy your latte.
Adjust the terms to fit your schedule and objectives, but keep the same principle. Not only will this system motivate you to achieve other goals, but it’ll also prevent you from splurging daily.
Are you guilty of buying lunch out every day? Or picking up takeout on your drive home a little too often?
Make the switch to groceries, and make sure that you buy at least a week’s worth of food at a time. If you make the effort to meal prep your work lunches, then you won’t be tempted — or forced — to eat out. It’s hard to say no to food that’s right in front of you, so prepare accordingly with your own ready-to-eat meals.
Apps are one of the sneakiest ways of getting us to spend more money than we planned. That’s because apps make purchasing incredibly easy; it’s all right at your fingertips.
Although shopping apps can be convenient, if you find yourself constantly ordering online, try removing the app from your phone. This will force you to go on your computer to complete a purchase, and you may find that in the time it takes you to do so, the order no longer matters.
Other apps to consider deleting include food delivery apps, online clothing apps, coffee bar apps, music apps, and other free-to-download apps that require in-app purchases. And if you pay for your phone data, then make sure you’re staying under your limit. Popular social media and streaming apps can be huge consumers of your data. Overall, the only money you should have invested in an app is your bank app.
Bad news: you tend to spend more when you shop with friends.
Peers have a lot of influence on our decisions, and purchases are no exception. Often, we give in to peer pressure and are persuaded to buy an item we wouldn’t purchase on our own — or the mob mentality excitement gets to our heads. So next time you need to go shopping, skip inviting friends and try a solo trip. You’ll be able to focus on buying exactly what you need without getting distracted or swayed. Not to mention, you’ll save yourself time and energy.
Take note that our brains tend to justify impulse purchases. Just because an item is on sale does not mean you’re saving money; you’re still spending, regardless. Try using cash instead of a card. Research has shown that people spend substantially more with credit cards — with one study finding that shoppers spend up to 100% more with a card. Transactions will hurt more when you use cash, which will prevent you from overspending the way you might with a debit or credit card.
Have a vice? Try creating a no-spend challenge with a friend for one month. Here are the rules.
During that month, under no circumstances can you purchase that “vice” — this could be anything from clothes to entertainment.
Do the challenge with a friend so that you have someone to hold you accountable for the whole month. Remember, this is something you must fully commit to, or it won’t work.
This challenge can be eye-opening because you will realize just how much your vice is costing you per month. It’ll also prove to you that you can survive without it, which may help you cut back on it in the future.
Congrats! You’re officially on your way to better budgeting. While you’re at it, let UFB Direct help you save. Open a high-yield savings account to capitalize on your saved funds. Put away a small amount each month, earn interest on your money, and soon enough, you’ll have a nest egg. Talk about easy money!
This insight was published by UFB Direct on June 15, 2022 and last updated on April 15, 2022.