Are your spending habits getting out of hand? It’s a common struggle—we’re bombarded daily with temptations to spend on things we often don’t really need.
Marketing tricks, fear of missing out (FOMO), and our innate desire for more have become a regular part of life. But it doesn’t have to be that way. If you care about your future financial health, you can learn to rein in the urge to splurge and start saving more!
I remember back in 2009 when I went shopping for a new pair of brown leather loafers for work. My old $60 shoes were falling apart, and shopping for work clothes was never something I enjoyed—it always felt like a chore.
Back then, dressing professionally was a must, so I was annoyed at the thought of spending on necessary work attire instead of what I really wanted. But now, having left my stressful office job behind to blog for fun, I get to wear what I want every day—jeans, a comfy t-shirt, and flip flops are my go-to outfit.
However, in 2009, I was still bound by the office dress code. That weekend, fed up with boring shoes, I rebelled and went shoe shopping.
Instead of heading to the discount stores I usually frequented, I went all out and splurged $435 at Barney’s New York on a pair of Tod’s loafers I’d been eyeing for over two years. Sure, they were beautifully made with fine leather and a sturdy rubber sole, but $435 was five times more than what I usually spent on shoes!
At the time of purchase, I reasoned that since I could return them within 30 days, it wasn’t really costing me anything upfront. But that mindset can be dangerous—many people end up keeping the item and regretting the splurge later.
Despite my intentions, I didn’t return those pricey loafers. They were incredibly comfortable, and thankfully, I could afford to pay off the credit card bill in full when it arrived. I got good use out of them—they held up well over time—but looking back, I failed to control the urge to splurge.
If I had taken the time to shop around at discount stores, I’m sure I could have found a similar pair of shoes for a fraction of the price. Maybe I would have been even happier knowing I saved so much money.
The best way to avoid the temptation to splurge, especially if you can’t afford it, is simply not to buy it. Period. Even with a return policy, the allure of keeping the item often wins out.
If you resist splurging, you can invest more wisely. With enough investments, you might even generate passive income to cover your living expenses someday—an exciting prospect!
My strategy for resisting splurges is straightforward:
1. Recognize that the excitement of a splurge is temporary, especially when paying with credit.
2. Always return items within the deadline of the return policy, no exceptions. Enjoy the item for as long as you can, but commit to returning it before it’s too late.
3. Calculate the real cost of a splurge in terms of your pre-tax income and hours worked. This often helps put things into perspective.
4. Try to find similar items at lower prices. It can be a fun challenge that saves you money.
5. Check your credit card bill regularly to remind yourself of the financial impact of splurging.
Splurging is okay within reason—for example, treating yourself to something special after achieving a long-term goal. But when splurges become frequent and impulsive, it can lead to financial trouble.
Remember, it’s your right to return an item if it doesn’t meet your expectations or if it’s not affordable. Don’t feel guilty about it—think of it as protecting your financial future!
If you’re serious about building wealth, start by tracking your finances with tools like Personal Capital. It’s a great way to manage your money effectively and plan for a secure retirement.
As for investments, I’m optimistic about real estate in the coming years. If you manage it wisely, real estate can be a lucrative asset class for long-term growth.
