By Michelle Wanjiku
If you lost your job or source of income today, how long will it take before you completely run broke?
Are you one of those people who use the phrase ‘tomorrow will take care of itself’ a lot when it comes to spending?
It doesn’t matter how much money you make, if you have bad spending habits, you will never be able to build wealth.
You hear it all the time; how you spend your money will determine your financial situation. One of the most common pieces of financial advice is to spend less and save more. However, how do you go about cutting down your spending?
Here are simple tricks to help you cut down your spending
1. Use only cash
Cashless payment has become so common that it is almost the norm, be it, using mobile money or your debit card to pay for goods.
This options when it comes to buying goods & services have made life easy because most people don’t want to walk around with a lot of money.
However, there is a downside to using these methods of payment, you won’t be able to actually see your money reduce and as such be tempted to spend more.
A study has shown that people tend to spend more money when they are not paying with cash. When you can physically see your money going away and reducing you will be less likely to buy a lot of things.
Additionally, when trying to stick to a budget using cash can really help. When going shopping, you should carry the exact amount you had set aside in your budget for shopping. This way, you to buy more than you had budgeted.
The next time you go shopping, use cash as it will help prevent you from spending more than you should.
2. Wait to make a purchase
Before you buy anything, you should always have a mandatory wait time. This will help prevent impulse buying and keep you from purchasing something you don’t really need.
For example, if you see shoes you really like and want to buy them, wait a day or two then go back and see if you still want to purchase the item. It is advisable to wait longer for bigger more expensive items.
This waiting period will give you a chance to see whether it is a need or want and if you have enough money to afford it without ruining your budget.
Most of the time, you will find that you only wanted the item because it was there and that you don’t really need it, so by waiting for a while you will be saving yourself from spending money recklessly.
3. Think of prices in terms of hours
They say time is money so you might as well quantify how much you are spending to how much time you are throwing away.
For example, if you want to buy new clothes for around 3000, think of how long it will take you to earn that amount of money. Let’s say you earn 20000 shillings per month and you work 5 days a week for 8 hours each day. This means that per hour you earn 125 shillings.
So in order for you to be able to buy the clothes, you will need to work for 24 hours. Are you willing to give up 24 hours of your life for those clothes? You could do so much more with these 24 hours that could help improve your life so are the clothes really worth it?
When you think of the money you are spending in terms of how many hours you are spending away then you won’t spend as much money on things you don’t need.
4. Save all your coins
Some people don’t like carrying a lot of coins around, if you are one of them, try saving all your coins instead.
Most of the time you cannot account for where your coins go because you end up buying sweets or other random things sold on the streets.
Instead of carrying your coins around you can put them in a jar, it doesn’t have to be something fancy, you can even use an empty plastic bottle.
Not only does this mean you will be able to spend less but you will also be able to save a good amount of money in the process.
SEE ALSO >>> Here Is The Best Financial Advice You Will Ever Get
The less you spend the more money you have to save, invest or start a business and as a result build your wealth.
Most wealthy people are smart when it comes to spending money; it is why sometimes people who earn less can become richer than people who earn a lot of money.
What other ways can you cut down spending?