The golden rule to accumulating wealth is to save more than you spend, which is definitely easier said than done. However, with the following financial hacks, you can avoid frivolous, impulse buying and plan your spending more successfully, thereby helping you to save more!
Walk it off
You’re shopping and you see something you really want. In that moment of weakness, it can be difficult to tell the difference between want and need. It’s almost as though you want to need it just so that you can justify buying it. The answer to this is to put the item back, exit the store, and continue with your day and by the time you’re ready to leave, you’ll have probably forgotten about it. Money saved! If, however, you still really want that item, make a plan to save for it so that you don’t have to swipe your credit card.
Odd days only
We tend to disregard the small amounts of money we spend on a day-to-day basis, such as coffee on the go, a take-away lunch, perhaps an impulse buy at a clothing store, etc. If you had to capture and tally up every single expense, you’d be surprised at just how much money you spend as a result! One thing you could try is to only allow yourself to spend money on odd numbered dates (or even dates). This basically halves the number of days you’re allowed to spend money on every month. The biggest benefit of this habit is the fact that it compels you to plan ahead and, for example, to pack lunches rather than buy them and resist impulse buys when you’re faced with temptation.
Leave your cards at home
Planning to go out with your friends? The answer is simple: take money and leave your cards at home. This way, you won’t be tempted to spend unnecessarily.
This strategy applies to any context involving temptation. If you’re going to the movies at the local shopping centre, only take a few hundred Rand with you to prevent yourself from making any impulse purchases.
What else could I buy with this money?
Whenever you find yourself tempted by a costly item – a want – think about all the other, far more important things you could buy with that money. For example, a super expensive brand name bag could easily set you back R2000 and many people would be willing to pay for that. But R2000 also translates into one month’s worth of groceries; it could buy new school clothing and shoes for your children; or it could go towards a family camping breakaway. Equating luxury spends with necessary spends can often be a much-needed reality check.
Out of sight, out of mind
With the arrival of any amount of money in your bank account (your salary, inheritance, or some other windfall) comes the excitement that demands that we go out and enjoy ourselves. However, we often wake up the next morning severely regretting all the money we spent unnecessarily. To work around this, immediately transfer a portion of your earnings or the majority of any windfall into a 30 day savings account. Without instant access to these funds, any decision you do make will require you to think first and plan accordingly.
Use rewards programs and promotions for all they’re worth
Almost every major retailer in South Africa offers some kind of rewards program and on a monthly basis, will run specials and promotions. By joining these programs, understanding how to manipulate them to your advantage, and keeping a finger on the pulse of these promotion cycles, you can ensure that you get the very most for the very least. For example: with Discovery Vitality’s programs, you can get up to 35% off local and international flights; Clicks runs three-for-two monthly specials on a huge array of products; and on certain days of the week, Pick n Pay sells soon-to-expire fresh produce at hugely discounted prices. Know when the specials are and strike while the iron is hot to save yourself hundreds of Rands every month.