The best way to save money is to set spending limits – but allowing the occasional splurge can help
Like with dieting, overly harsh restrictions on your finances can lead to overindulgence and blowing all your progress
- Aggressively limiting your spending is kind of like dieting – at some point, you’re going to overindulge and blow all the progress you made.
- Instead of saying no to every single “indulgence”, a financial counsellor says it’s better to say yes once in a while and let yourself enjoy your money.
- Don’t toss your budget, though – it’s still important to track your money, save, and spend within your limits. Consider giving yourself a monthly budget for “fun money” so you don’t feel overly restricted.
If you’ve ever blown your budget on eating out, shopping, or entertainment, you know some of the biggest financial issues we deal with can stem from a basic lack of self-control.
If you’re hoping to boost your savings, focus on your investments, or get out of debt, curbing – or completely eliminating – impulse purchases seems like the most logical solution.
But there’s actually scientific evidence that depriving yourself could do you more harm in the long run. That’s why people who crash diet typically end up craving and eating more junk food.
On the flip side, some behavioural scientists think allowing yourself a lapse in self-control every now and then could be key to maintaining will power.
Flex your ‘self-control muscle’
Picture self control as a muscle. If you’re constantly working that muscle, it will eventually run out of energy, leading you to lose control later on.
Financial experts say this principle holds true when it comes to money. For example, if you say “no” to eating out with friends every time they ask for the sake of sticking with a tight budget, your deprivation might cause you to overdo it later on, leading you to spend more money.
