Money Psychology

How To Retrain Your Brain From Overspending to Saving
by Alana Downer

August 2017 - When you have been hit by the spending bug, it's hard to turn things around. All you want to do is buy yourself something nice, right? Shopping can trigger pleasure centres in the brain and thus is a hard habit to break out of. Here's how to make your brain understand that you need to save, not spend.

Keep Busy

The first thing you need to realise is that idle shopping often happens when you are bored or unhappy. Keeping busy can be an antidote to both of these things. A great way to fill up your time is to take up a new, inexpensive hobby. For example, you might take up needlework, painting, crafting models, or some other task that keeps your hands occupied. When you are busy, you are more likely to be happy and less likely to be bored. This distracts your mind from the possibility of spending.

Reconsider your idea of fun

For many people, there's no better way to spend a night than to go out on the town with friends and enjoy some drinks. This is a lot of fun, but it is also very expensive - and can even be damaging to your health. Start reconsidering your idea of fun. You don't have to spend money to have a good time. Invite your friends over for a drink at your place - you can have a good time and save a lot of money on drinks and entry fees. Watch a movie on TV together, go and play sports in the local park, or just find a quiet place to chat - these things can all be a lot of fun without having to cost you any money at all.

Make a budget

Often, overspending happens because you don't really know how much money you have spent. Make a budget by first calculating how much money you get paid each month. Now take out any monthly expenses such as bills, rent or mortgage, and items that you are paying off. Make sure that these payments are automated so you never miss them. What you have left is your spending budget. You can install an app on your phone to keep tracking of your spending - once you see how much money you are giving away, you will realise you need to cut down. You can also even set up a direct debit which goes from your bank account to your savings account as soon as you get paid.

Always pay in cash

Another trick to stop you spending so much is to stop using credit cards or debit cards. Withdraw a certain amount of money at the start of the week and use it for all of your spending. This way, you will physically see the cash that you are spending. When you use a card, you can be fooled by the fact that it is not real cash and doesn't register in your brain the same way. Using a cash-only rule also provides more limitations. You won't be able to make larger purchases because you don't carry that much money around. You will also be forced to stop spending when you have already spent your budget for the week.

There are lots of ways to stop yourself from spending, but until your brain is really on board, there is always a risk that you will overspend again. Use these tricks and you will find that you are more aware of every penny that you spend. That makes it a lot easier to avoid spending when you really need to be saving.

About the author

Alana Downer is an avid blogger and self-improvement enthusiast, interested in all aspects of achieving financial independence. At the moment Alana is writing for Learn To Trade, where she helps like-minded people and shares her tips and strategies with her audience.