Concerned about your bank account after the holiday season? Very often, we feel that we are trapped by the past financial decisions we have made. This is problematic because our past behaviours do not have to dictate our financial future.
Mindset Shift Important
Our emotions and daily behaviours are important contributors to our financial situation. The easier we can make our regular spending and saving habits, the easier it will be to take control of our cash flow. Establishing an underlying ‘why’ for making this shift in spending can also help us remain committed to changing our everyday actions.
We outline several financial mindset shifts here which can be incorporated into your daily life.
Target Big Purchases
The majority of our monthly spending goes towards housing, transportation, and food. Although it can be tempting to skimp on little purchases like a cup of coffee, this will not yield the biggest financial impact.
To reduce your grocery store bill, you might decide to meal plan your week in advance. This is a fantastic way to save money. If you know ahead of time what you are planning to eat each day, you can adhere to a weekly food budget. It makes it less likely that you will purchase food impulsively or buy meals out.
If you have fitness on your list of New Year’s resolutions – bicycling to work may be a great option for you! Not only will this help to increase your fitness level, it will also reduce the expenses associated with gas and car maintenance. You might even be able to reduce the number of cars in your household.
Think Money = Time
Money has become increasingly less tangible for our society. We bank online and swipe our credit cards for purchases which we may later regret.
One mindset shift which can contribute to a reduction in spending is equating your spending patterns with units of time. For example, calculate how many hours of your work week would be devoted to purchasing a new 65″ TV screen for $800. Ask yourself whether or not this purchase still seems worth your time.
This forces you to pause before purchasing and gives your spending a tangible link back to your income.
Be Honest with Yourself
Self-reflection and honesty with yourself is one way to help shift your spending mindset. What gives you the most enjoyment in life? This question might prompt you to cancel out memberships or subscriptions which are not giving you what you need.
Additionally, it might mean that you say ‘no’ to requests from friends more often. Saying ‘yes’ to every ask that comes your way can generate a lot of unwanted stress as well as increase your monthly expenditures.
When attempting to make these mindset shifts, knowing your underlying ‘why’ is important. For example, the money that you save through altering your behaviours might contribute to a healthy savings account which can be used to reach big life goals, such as a wedding or a long-desired trip.
Remember that your past spending behaviours do not have to dictate your financial future. There are plenty of small changes you can make each day to reduce your spending levels. Start your new year off with a fresh outlook to see your savings account grow!