The Habit of Conscious Spending

By Leo Babauta

If debt reduction/elimination is going to be a long-lasting endeavor, then one of the most important mental habits to form is that of conscious spending.

Let’s think about how less-than-conscious spending can lead to debt problems:

While this might not exactly describe you, you can see how it quickly adds up, and how this eats away at your income and adds to your debt problems, without much effort or thinking involved.

If you don’t change this habit, the debt and other financial problems won’t go away, even if you make a good dent in them in the next month or two.

How do we change? Here’s what I recommend:

  1. Align your values. Following a budget is cumbersome. I’m not saying don’t do a budget, but what’s more important is to know what your spending values are. Once you know your values, then it’s just a matter of checking in with them before you buy something. So what’s important to you? Spending should reflect that. If clothes are important to you, then that’s one of your core values. If not, then what is important? For me, it’s family, writing/creating, being active, reading/learning. Knowing those core values helps me align my spending with what’s important to me, and when spending isn’t aligned, it becomes much clearer.
  2. A 30-day list. This is a wonderful tool for making your spending more conscious, and less on impulse. You have a list (it can be on your computer or on paper) where you write down anything you want to buy (except necessities like groceries and toilet paper), along with the date the item was added to the list. And you have a rule: you can’t buy anything on the list until 30 days after it was added. So if you put “cool new shoes” on your 30-day list on Sept. 30, you have to wait until Oct. 30 to buy them. Why does this work? It gives you time between the impulse to buy, and the actual purchase, so that you can consider it and let the impulse go away. You’re not saying no, but you are saying “pause”. And so you have time to consider whether it’s in line with your values.
  3. Halt online shopping. Shopping online is so easy, because it’s a few clicks and the item comes to your door in a couple days. That’s as easy as posting your cat’s/child’s photo to Facebook. It’s important to put a pause on this easy spending. Use the 30-day list, but to remember not to click “Order”, you might block those sites using a website blocker.
  4. Review automatic payments. Every month or so, and definitely sometime in the next couple of days, review the payments that are automatically charged to each of your credit cards, bank accounts, and online payment services such as Paypal. Yes, that includes your monthly Sea Change Program charge! Are your automatic payments necessary, and in line with your values? Cancel the ones that aren’t.
  5. Find other ways to relieve stress, comfort yourself, and socialize. While shopping can serve some real needs, you don’t need to shop to fill those needs. There are other ways. For example, if you use shopping to relieve stress, you can meditate, have tea, go for a walk, do a workout, or talk to a friend instead. Comforting yourself might be taking a hot bath, getting a massage from your spouse, having some tea, snuggling up with a good book. You can socialize by going for a walk, having a picnic in the park, playing charades or board games at home, playing chess, going for a hike or run, etc.

You don’t need to implement all of these at once, but put each one on your to-do list sometime this month, and get your conscious spending habit going!