How to control spending

Controlling spending can be achieved through several strategies:

1. Budget: Create a detailed budget that includes all of your income sources and expenses. This will help you understand where your money is going and identify areas where you can cut back. A budget should be written down and should not reside in your head. This is psychologically important. Writing things down separates you from them and enables you to objectively think about them.

2. Understand the difference between needs and wants: Needs are essentials for living such as food and rent, while wants are luxury or non-essential items. Prioritize your needs over your wants. Learn that wants are endless while the things we truly need are few. Financial freedom comes from meeting our needs while controlling our wants.

3. Track your expenses: Use financial tools or apps that can help you track your expenses. This can give you insights on your spending habits and show you areas where you can save. A simple app like Wallet can help you get a grip on your finances. Review your finances on a regular basis like every week or month. Make changes to the budget where necessary.

4. Avoid impulse buying: Before making a purchase, give yourself time to think about whether you really need the item or not. Try and delay the purchase for a day or two. This gives you sometime to calm down and make a more logical decision.

5. Set financial goals: Having a financial goal in mind, such as saving for a down payment on a house or for retirement, can help motivate you to control your spending.

6. Use cash or debit cards: Credit cards can encourage overspending. Using cash or debit can make you more aware of the money you’re spending.

7. Save first: As soon as you get your paycheck, transfer a portion of it to your savings. This “paying yourself first” technique ensures you’re building your savings consistently.

8. Automate savings: Set up a standing order or autosave to automatically save something, however small, on a regular basis e.g. daily, weekly, or monthly.

9. Setup healthy boundaries around giving: There is a lot of financial need around us from family, friends, community, etc. If we are not careful we end up carrying an enormous burden. Give generously but set a monthly limit on how much you can give. Learn to say no without feeling guilty.

10. Control debt: Try to avoid consumption debt like car loans, credit card debt, school fees loans, etc. Avoid money lenders. Carefully evaluate mortgage financing before committing. Only borrow to finance safe investments which can generate enough cash to pay off the loan.

11. Avoid peer pressure: We are all on different journeys to different destinations. It’s foolishness to envy other people yet you’re on different paths. Be comfortable with who you are and be grateful for what you have. No need to keep up appearances and try to impress other people while going broke.

12. Allocate some money for impulse spending and fun: This way you don’t feel deprived. Spend this cash as you wish without accounting to anyone. Spoil yourself once in a while. You only live once.

13. Get an accountability partner: If your spending is really out of control consider getting someone you trust to hold you accountable. This could be a spouse, friend, colleague or financial coach. Knowing that you have to explain yourself to someone else can bring some sanity in your finances.

14. Control addictive behaviours like gambling, sports betting, drugs, smoking, too much drinking, shopping, promiscuity and partying. These terrible habits have a way of depleting bank balances rather fast. Become aware of these vices and find ways to control them. Easier said than done but absolutely necessary if you desire financial freedom. The idea is not to try and become a saint, but rather to enjoy life’s pleasures without becoming enslaved by them.

Remember, it takes time and discipline to control spending but it’s a crucial step towards financial stability.