I’ve tried many approaches to money management over the years and at the moment I’m trying a new one – spending to save. As in, managing spending not saving. See the outcome I’m chasing is more savings, but the major impediment to that is my spending! So by working on the spending side of the issue I can effectively control what’s left in the bank at the end of the pay fortnight. I’ve even created a series of objectives and key results to measure those objectives. It’s pretty straightforward – spending money on one lunch per week, and one coffee per week instead of many! A focus on this has meant that rather than trying to save money, I’m focused on the business end of the job and so far it’s working. For December my spending is down about 80% on lunches and coffees. So after 10 or 11 days I’ve normally spent about $20 a day for lunch and $5.20 for coffee per day. So $250 odd bucks up. Not bad eh?
It’s the change in perspective that has started to work. I’m still occasionally buying lunch, usually because I don’t have a choice to pack something – it’s not uncommon to end up somewhere I didn’t expect. The overall trend is going in the right direction though – and you can’t help bad luck. But spending $50 instead of $250 is a win in my book. So spending is OK, I just don’t want to do it a lot. I won’t meet my OKRs!
Changing perspective in respect to lunches and coffees has spilled over to other areas of spending – cutting down on stuff I might normally grab that really isn’t important or worth buying. It’s weird – I literally reached out for a new bit of tech and then stopped… the spending focus had kicked in. No new toys for me… when I had to buy some replacement stuff for the car which was very broken the cash was there. It was quite pleasant really to have that happen. Often I’ll have to dip into savings for something not much more than $100 which is never nice.
So I have several strategies running at the moment. Steal from them what you will:
- immediate savings straight from payday – money is shuffled off to savings accounts and to hard to get to places
- forward payment of bills so I’m always ahead
- immediate payment to Vanguard and to home loans
- spending management and OKRs to set audacious goals
Usually this time of year I’m haemorrhaging cash, but now it seems different. There’s more money in the kitty and I’m in no urge to spend. It’s weird and strange and the desire to buy stuff is getting less and less. It seems like working on one part of the money helps other parts and I’m well ahead of several savings and spending goals for the year. Next year I’ll be more adventurous in those goals and see how it ends up.
Give it a try – focus on spending, not saving and see if you get any changes to your thinking about it all!
Cover image: Photo by freestocks.org from Pexels