“Spending” isn’t just about cutting back—it’s about having a plan for using your money wisely so you can reach short- and long-term goals. The core idea is simple: make a budget or spending plan, live within your means, track your habits, and shop smart—especially for big purchases.
Here’s a practical, real-world guide to help you do exactly that.
1) Start with the real goal: spending on purpose
A strong spending plan begins with two questions:
- What do I need to cover each month?
- What do I want my money to build over time (savings, debt payoff, future goals)?
Set short- and long-term financial goals and managing money to meet them—not just tracking expenses for the sake of tracking.
2) Set spending “maximums” (the easiest way to stay in control)
One of the simplest spending-control methods is to set a maximum amount you’re allowed to spend each week or month—and then stick to it.
Why it works:
- It creates a clear boundary (instead of vague “I should spend less”)
- It forces trade-offs in the moment (“If I buy this, what am I giving up?”)
Quick action: Pick 1–2 categories that often run high (eating out, shopping, entertainment). Set a weekly cap for each.
3) Track spending long enough to see patterns (not forever)
Track your spending for a few weeks or months to understand where your money is actually going—and even recommends using online systems or phone apps to make it easier.
You don’t need to track forever. You just need enough data to answer:
- Where am I consistently overspending?
- What purchases were impulse buys?
- What expenses are predictable but keep surprising me?
Quick action: Track every expense for 14 days and label it as: Needs / Wants / Goals.
4) Be a smart shopper (value matters more than price)
A spending principle includes being a smart shopper and comparing price and quality.
A “smart shopping” checklist:
- Compare at least 2–3 options (store vs online vs local)
- Check total cost (tax, shipping, add-ons, warranty)
- Look for the best value, not just the lowest sticker price
5) Don’t let discounts trick you into buying stuff you didn’t plan for
A key tip: don’t let a sale or coupon convince you to buy something you don’t really need or that isn’t in your spending plan.
A simple rule that prevents most “deal spending”:
- If it wasn’t already planned, a discount doesn’t make it a savings—it makes it an unplanned purchase.
6) Big purchases: slow down and comparison shop
For large purchases, take time to comparison shop and check prices at multiple places—by phone or online.
Big purchase method (fast and effective):
- Define what you need (features, size, quality level)
- Compare 3 sources
- Wait 24 hours before buying (helps reduce impulse decisions)
A simple “Spend Smarter” weekly routine
- Weekly (10 minutes): Check spending vs your category maximums.
- Monthly (20 minutes): Review trends, adjust caps, and set a short-term goal.
- Anytime you’re tempted by a deal: Ask “Was this in my plan?”