How to break up with your bad spending habits
Have you ever wondered why your self-described ‘bad’ habits are hard to shake while the ’good’ ones take longer to form and keep? You know, the way one cheeky after-dinner ice cream turns into adding a tub to the shopping list every week?
We’ve all fallen victim to a bad habit that doesn’t serve us anymore. For example:
- Ordering takeaway regularly when we’re too tired to cook.
- Using buy now, pay later apps to buy something when we don’t have the money saved.
- Skipping the gym and sleeping in because...comfy.
Each of these habits, along with the ice-cream, have a common theme – they all give us instant gratification.
While the reward for a bad habit is gained instantly, once you wake up from that third sleep-in in a row and see your gym gear waiting for you, there’s often some guilt that creeps in. These kinds of bad habits eventually sabotage the goals we’ve set for ourselves.
So how do we get back on track? While it takes some work, here are some common habits to stop, and new ones to start.
Stop: using buy now, pay later apps.
While buy now, pay later apps allow you to break up the full cost of a purchase across multiple payments, it can be a slippery slope into overspending. In fact, it’s been reported one in five Australians regularly miss their repayments for these services.
In the short term, all those purchases can add up to a bigger regular payment than you’d initially bargained for. Then there’s the potential cost of interest or fees for late payments.
And if you’re saving for a home, remember these services are considered a line of credit by your lender. So, if you have buy now, pay later transactions on your bank statements, even though they’ll be paid off in a specific timeframe, your lender may factor them as regular, ongoing payments – which could affect your borrowing capacity. If you make a late payment, it can also go on your credit report, potentially affecting any future loan applications you have.
Start: Saving for your splurges.
The easiest way to not use buy now, pay later apps is simply not to use them. Don’t buy the thing. But we get it, if you really want something, it's hard to shake. Ideally, we’d say save ahead of time, or set yourself a goal and mark in your calendar when you can afford to spend. Who knows, you might decide it’s not a must-have purchase and lose interest.
If you can’t part with them, try setting some parameters for how and when you use them. Try paying off one purchase in full before making another. Or set yourself a dollar limit that you will use buy now, pay later services for, and anything over that limit needs to be saved for.
Stop: daily trips to the supermarket.
If you swing by the shops to get dinner every night, it may be costing you more money. Driving there – that's petrol. Forgot a bag? That’s an extra 15 cents, please. That extra packet or two of chips you sneak into the basket because it's late and you're hangry? Another $5.
Shopping for one meal at a time is also going to see your fridge pile up with half-used items that, let’s face it – will most likely end up in the bin. Not to mention the decision fatigue of trying to make nutritious choices when you just want to get home, make dinner, and watch Greys Anatomy.
Start: planning your meals and making a shopping list.
Planning meals does take time and a big shop feels like it costs more, but there are huge time and money savings to be gained. Planning your meals over the week helps you use up all that veg and perishable items, so they won't go to waste at the bottom of the fridge. And when you order online for click & collect or delivery, you gain back time in your week, mileage on your car, and some self-restraint from the confectionery aisle. Triple win!
Stop: running your fuel tank to empty.
If you’re the type of person that doesn’t even think about filling up your car until the little orange light comes on (or even worse – when it starts flashing at you), keep reading.
Not only do you risk damaging your car in the long run, but if you take it too far you might have to call roadside assistance to give you a boost – which is a big cash outlay. You’re also at the mercy of the daily petrol prices when you need to fill up, which can be a serious hit to your wallet.
Start: filling up your car when petrol prices are low.
The smartest way to fill up your car is to top up regularly when the fuel is at the best price. It’s easy to find and compare fuel prices with online apps and websites that show you real-time fuel prices in your area – you can even get price drop notifications. And don’t forget to use any fuel vouchers you have when you visit the pump.
Stop: buying cheap clothing.
Paying $10 for a new top might seem like a bargain at the time, but that old saying is true – you get what you pay for. Cheap clothing isn’t made to last – you’re lucky to get a few wears out of it, let alone a whole season. So that cheap top needs to be replaced multiple times, likely ending up in landfill before the year is out.
It’s a frustrating cycle constantly replacing clothes and feeling like you have nothing to wear, and it’s not great for the environment.
Start: investing in a capsule wardrobe.
The capsule wardrobe might seem like a fleeting TikTok trend right now, but it’s a piece of sound wardrobe advice that’s been around since the early 1940s. While fashion has certainly changed since then, the concept hasn’t.
Skip those fast-fashion options and invest in a few quality pieces to mix and match – soon you’ll have a sustainable wardrobe that will last for years.
If the idea of a capsule collection feels limiting to your personal style, then why not shop like you would for groceries? Take stock of your wardrobe and make a list of what’s missing. Next time you get the itch for some retail therapy, work towards filling those gaps, rather than just buying what’s on sale or what will work for right now.
Stop: paying for subscription services you’re not using.
Subscriptions might seem cheap when you look at the monthly fee, but add that up over a year or two, and suddenly it’s not so economical. If you have multiple subscriptions, it's likely you’re not getting enough value out of some of them.
Start: Being a smart subscriber, or look for free alternatives.
When it comes to subscriptions, you don’t have to go without, you just have to be smart. Create a one in, one out policy – if there's a show you want to watch on a streaming service, cancel one you’re not using right now before you hit subscribe – you can always go back later!
Opt for free streaming options and tolerate the ads. See if any of your memberships or current subscriptions can get you discounts on other platforms. Ask your local library about hiring audio books, or coordinate your streaming services with friends, and schedule rotating movie nights to share the fun. Saving on subscriptions and a cheap night in? You’re onto a winner.
Stop: being the person that pays for everything.
Whether it’s a big night out or a spontaneous weekend of fun, good times are better when they’re shared. But sometimes you might find yourself in a situation where you’re seemingly always the one sticking your hand in your pocket. It can be frustrating, and it makes some friendships expensive.
Start: removing guilt from talking about money.
It’s important to keep track of what you’re spending at any time, but especially when you’re paying for others. And sure, sometimes it can feel a bit yucky to add your bank details or PayID in the group chat, but if someone paid for you, you’d want to make sure you’re square, right?
It’s also good to be upfront with friends about your financial situation and goals. Before you go out next, be clear about what you’re comfortable spending, and make it known to your friends what your budget is. For all you know, they could have savings goals too and you can find an alternative, cheaper way to catch up that works for everyone.
Start good savings habits today with a myBOQ account.
If you have a myBOQ account you can download the myBOQ app which has plenty of features that can reinforce good money habits, like the budget tracker, which helps you keep tabs on where your money is being spent.
