A couple of years ago I started a company that was doing fairly well. And while it was a ton of hard work, I was pulling in good money and beyond happy that I was getting paid to do what I love. I so enjoyed the new luxuries I could now afford, like taking a Via to work every day, ordering Seamless all the time, seeing a personal trainer and don’t even get me started on all the fancy cocktails I would routinely order (I’m a sucker for a good Old Fashioned). I didn’t feel bad about any of these new habits because I told myself that after working so hard, I deserved it. Treat yo self as they say.
And then everything fell apart pretty quickly. The business failed and all of a sudden revenues completely disappeared. My monthly income went from a lot to $0 quite abruptly. But my expenses remained the same because it felt impossible to cut anything. You see, by this time I had developed some pretty bad spending habits and in some ways I felt trapped by them. From my perspective, to cut any of these luxuries was like slicing my identity and burning away my dreams. (Being a drama queen can be pretty expensive).
I had to figure this out though. I knew I had to redefine my spending in a way that didn’t feel so excruciatingly painful. We all have our spending addictions that feel impossible to get rid of. But you’ll be surprised what we’re all capable of. If you’re finding yourself addicted to certain spending categories here are some ways to help:
Reflect on who you are
This is important. Take a moment to think about all the things you spend your money on day to day. It might help to actually review your transactions because you’ll be surprised to find out how many things you spend on that you don’t even realize. And once you have a general sense of your big spending categories, take some time to reflect.
Ask yourself, what do these things really mean to you? What would it mean if you cut certain expenses completely? Are there cheaper alternatives out there? Don’t be afraid to go deep here and get under the hood. For instance, I was spending a lot on personal training. I realized that the reason I saw my trainer was because I felt deep down that I was going to fail at fitness if I did it by myself. This was false and I decided to cut this expense and go it alone. In the end it was actually quite liberating.
Start small with one area
Now that you have a deeper understanding of what you’re spending on and why, choose one area that you feel is your kryptonite. This is the one spending category that you feel like you should cut but you know is going to be challenge. And start small. Commit to three days where you’re spending below a certain threshold. Or if you’re feeling really ambitious cut out the expense altogether.
If you download Clasp, we can help by keeping you honest and accountable to a certain spending mission based on your spending habits. Try it out, it's free. We’re finding this approach to be particularly effective and can really be a good start to getting your financial shit together.
Have empathy for yourself
Perhaps most important, have empathy for yourself. Take a moment to acknowledge that this is hard work. We’re hard wired to make the vast majority of our spending decisions without even thinking about it. So reprogramming yourself is a tough thing to do. Allowing yourself some room to mess up once in a while is okay. As long as you set the intention to get back on your mission.
After my company failed, I was fortunate enough to land a job a few months later. And while it wasn’t paying me anywhere near as much I was making at the height of my success, it was a steady paycheck and allowed me to get back on my feet. And in some ways making less money, allowed me to take inventory to prioritize and spend more intentionally and authentically to who I am.
What so many personal finance experts get wrong is this idea of one size fits all advice. We’ve all heard the same old “cut out the Starbucks” or “Only go shopping on Black Friday.” I don’t believe in that because the fact is we’re all different people. We all come from different backgrounds and have had our own life experiences. Your splurge may be different from mine. The key is to spend more authentically to who you are as a person. One of our favorite mottos at Clasp is that success means understanding yourself and therefore making the best financial choices for you. And taking a moment to reflect before diving right into your financials can make all the difference.
And away we go
This is the beginning of a beautifull friendship. In the meantime, are you curious to know what emotions drive your spending? Take our quiz to find out