Saving Money in the New Year – 3 Steps and 14 Days to Lasting Change

The holiday season falls during the darkest, sleepiest time of year in North America.  That may be why so many of us use winter as a time for reflecting on how far we’ve come in our latest trip around the Sun, and for envisioning the new life that’s coming in the New Year.  It’s energizing to imagine a squeaky-clean new version of ourselves: one that eats better, exercises regularly, drinks more water, less wine and coffee, and finally (finally!) starts saving more money.  Back here in reality, we all know how hard it can be to make that kind of change. After all if it were really so easy, we wouldn’t need a special occasion to get motivated.

“You have to find something that you love enough to be able to take risks, jump over the hurdles and break through the brick walls that are always going to be placed in front of you. If you don’t have that kind of feeling for what it is you are doing, you’ll stop at the first giant hurdle.” ~ George Lucas

The first part of commitment is desire.  If you don’t want it, you won’t fight for it.  The difficult truth is that some people just aren’t ready to save money.  If what you really want is more money to spend, or if you’ve got your eyes on a big-ticket luxury item at this very moment, you are not ready for saving.  On the other hand, if the idea of making peace with your financial habits sounds good, but you need help making a solid game plan, read on!

Step 1: Honest Self-Reflection If you do want to change your spending habits, it would help to know what specific changes you want to see in your own behavior.  What are the situations where you find yourself spending money, and then kicking yourself a little for afterward?  Think over 2010.  What did you ‘waste’ the most money on?  If you keep an electronic bank account, that’s even better.  You can probably see where your money went by category.  My husband and I were amazed to learn that we spent over $5000 on convenience food last year.  That is one area I intend to scale back on.

For my own part, in 2011, I want to

  • Save at least $100/month by spending less money on convenience foods.
  • Deposit the savings into our savings account so it doesn’t get spent on other things later.

Step 2: Motivation and Reward The typical approach to saving money usually means being less comfortable in some way. At the very least, we know that we’ll have to resist the impulse to spend the way we always do.  Why would we want to commit to something that’s a drag just to think about?  The bottom line: We spend because it makes us feel good.

Any new behavior you want to adopt must give you an immediate, positive emotional reward.

If we want to spend less, we need to find a way to feel just as good (or better) while doing something different from our typical, habitual spending.  Once you’ve picked one or two specific habits that are costing you more money than you want to be spending, you need to figure out what emotional NEED those habits have been meeting up to this point.  Everything we do is for a reason. If you have fallen behind on credit card payments but still spend $4/day on luxury coffee there is a reason, and irresponsibility is probably not it.  Does a latte bring you comfort during a stressful day at work?  Is lunch at a restaurant more socially gratifying than lunch in the break room?  Are new clothes a cure for the blues, or new tools a fix for boredom?

The key to change is pinpointing the emotional need you’re meeting now, and continuing to meet that need while spending less money.  If you really work at this, you’ll find that you feel better, not worse, than you did under your old spending habits because you’ll be getting your emotional needs met, and you’ll also feel proud of yourself.

Last year, I cured myself of $200 clothes shopping sprees by giving myself a few shopping rules.  I realized that I went shopping the most when I felt ugly.  With that in mind, I set out some guidelines:

a.     I dress my BEST when I go clothes shopping, and I make sure I feel gorgeous.  I never go shopping feeling frumpy.  Otherwise, the shiny newness of the mall itself will play on my insecurities, and I’ll buy more. Sometimes, just getting myself dolled up to go shopping is enough to boost my mood, and I don’t feel like buying anything anymore.

b.     I make myself a promise before I go: “I will not buy anything that I don’t love as much or more as my current favorite thing.”  Why would I want anything that isn’t better than the best of what I already have?

c.      I give myself a spending limit that I can afford without stress. I set this amount BEFORE I walk into a store.  If the most I want to spend on a given day is $15, then I have an exciting treasure hunt on my hands.  Finding something that I like more or better than my current favorite thing on a shoestring budget turns me into an extremely picky buyer.

These guidelines make me a hard shopper to please.  It feels good to me, because I work hard for my money, and I’m no longer willing trade my valuable efforts on forgettable or regrettable items. When I employ these rules, I like how I feel when I walk out of a store empty-handed.  I walk away feeling choosy, not deprived.  My shopping habits are now based on self-respect instead of self-sabotage.

When I looked at 2010, I saw that I spend a lot more than I want to on convenience foods.  Fast food, lunches, and dinners in the car on busy days…it adds up.  If I’m going to spend less on this, I need to figure out why I buy convenience foods so often.  Strange as it sounds, I think it’s boredom.  Just the thought of packing a lunch bores me.  I like to leave my home or office behind and go where there’s some action.  I like to watch people buzzing around through their day while I relax and eat, and I don’t like having to plan my menu ahead of time.  I’ve tried buying funky fashionable lunch boxes to make packing my lunch more fun.  That worked for about a minute.  What in the world am I going to do?

Step 3 – The Game Plan They say it takes two weeks to break a habit.  That means 14 days of calculated, controlled effort to change your habitual reaction under pressure.  Think about it. A 14-day change is a decent test-run.  If you feel deprived and unhappy after 14 days of spending differently, you can always go back to how you spend now.

To get me through my first two weeks of January 2011 without buying lunch out, I’ve come up with the following plan:

I’m going to ask a few friends who work near me if they would like to form a little lunch group.  As the Ladies Who Lunch, we will each pick one day of the week, and prepare a lunch for the whole group.  We’ll meet up someplace lively and eat, chat, and blow off the stress of the morning.  This way, I only have to plan my lunch one day out of the week, and I can pick the day that works best for me.  The rest of the time, all I have to do is show up and enjoy great food and company for an hour.  I think it will fix the boredom problem.  Preparing food for friends is always more fun than doing it for myself, anyway.

I spend an average of about $6 on lunch per day now.  If I spend $15 a week making lunch for my friends, I’ll still save $60 a month – more than half of my monthly savings goal!  Plus, I’ll get more face-time with my girlfriends. After my 14 day trial, I’ll take stock and see how it’s going.

I’ll need a solid game plan for cutting back on fast food trips, too, but you’ve heard enough from me for now.  I want to invite you to take this journey with me.  What one or two changes will you be making?  What’s your game plan?  Feel free to participate, comment, and ask questions or ask for support here on this site.  Here’s to reaching those goals in 2011!


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