Let’s face it, we all can admit to having some bad financial habits, whether it’s not keeping track of our monthly spend, impulse buying, or spending more on takeout food than we anticipated. That’s why we’ve put together this blog, to help you tackle some of those bad financial habits and understand new healthy spending habits that you can implement into your lifestyle to keep more money in your pocket and feel like you have more control over your financial wellbeing. You may be hoping to save for a house one day, a trip that you’ve been meaning to go on, or for those new trainers you’ve been eyeing. So we hope that these tips will help lead you on a more righteous spending habit and ensure you can feel good for the months to come, especially now that we’re leading up to the holiday season!
Understanding Bad Financial Habits and Where They Stem From
A few of the most common bad financial habits can include:
- Ignoring or putting off paying your debts: Knowing that your debts remain, but pushing them off because it stresses you out.
- Having a lifestyle that goes beyond your financial means: Spending more than what your monthly income can support, leaving you in a situation of having little money left by the end of the month.
- Impulse spending – spending money on something because you really want it in the moment – and then regretting it later and are stuck feeling regretful about it.
- Neglecting your savings and more opportunities to save.
- Failing to think about your long-term financial future.
We ALL can resonate with at least one of these. So, why do we obtain some of these bad financial habits, and how can it affect our overall wellbeing?
Factors Impacting Financial Decisions
Emotions
Emotions have a direct effect on our financial habits – Feeling sad or anxious can lead us to spending money to make us feel better when we’re going through the hard moments in our lives. Equally, feeling extremely happy or celebrating a new win can make us impulsively buy things to celebrate or treat ourselves. As emotions remain a very powerful feeling in the moment, it can deter us as times from making logical decisions. This is just part of human nature and plays into behavioural economics which challenges the idea that humans act rationally. In fact, it is thought that humans often act irrationally, with emotions playing a crucial role in these behaviours.
Money Scripts Defined
The ‘Money Scripts’ description by psychologists can be defined as our subconscious beliefs about money, which can impact the way we choose to spend it. These scripts are categorised by different types including money avoidance, worship, vigilance or status. They are often formed in childhood as we develop our understanding of the meaning of money and its value to our individual lives. Being able to identify these within ourselves and which category we may fall under can help us learn to change our mindset and be more mindful about how we choose to spend money for the future ahead. You can learn more about this by reading this Forbes article: The Psychology Of Finance: How Money Scripts Affect Decisions And Actions Related To Finances (forbes.com)
Social Influences
Social influences play a huge role in our financial decision making. The pressures of peers, as well as the ongoing and ever-increasing pressures of social media today make it difficult to navigate making rational decisions when we are bombarded with advertisements, influencer promotions, media, and more. This can often lead us to making large purchases or trying to keep up with a lifestyle that goes beyond our financial means.
Now that we can understand where some of our bad financial habits stem from, it’s important to actively navigate through them and find the right solutions that work for you and the personal goals you’re trying to reach with your finances.
The Steps to Breaking Your Financial Habits
1.The first step to breaking your financial bad habits is acknowledging them. If you’ve clicked on this blog, you’ve probably thought about one habit that you’d like to change. Recognising that there is an issue you want to fix allows you to be mindful about your decision making moving forward, which is a great first step.
2. The next step is setting realistic goals for yourself. Setting goals you want to reach will allow you to understand what decisions and resources you can turn to next, as well as to think about what you want in both your short-term and long-term financial future. Take a moment to write down at least five goals you want to reach on a piece of paper or your computer, so that you can start to make your plan of action.
3. After setting realistic goals for yourself, it’s about establishing a plan that reflects those goals. What small steps are you going to take to work towards the difference you want to see in your financial habits? We recommend finding some helpful resources such as apps that help you to track your spending habits, stay up to date with paying bills, or discussing financial advice from professionals. Find what resources work best for you and give yourself a time frame to work in that reflects your goals as well. The key to the success of this plan – is ensuring there is consistency and that you are staying on top of actively following the plan and reaching your goals.
4. Consider leveraging Complete Savings to help you earn additional cashback on your purchases! Through paying a monthly fee when subscribed to the programme, you’ll have access to over 1000+ retailers to shop at with a minimum of 10% cashback on your purchases. By making a purchase through the retailer you signed up with and claiming your monthly bonus, it allows you to get more into your account and can cover most of the cost of your monthly fee, as long as you make a purchase through the retailer that you signed up with. Complete Savings also offers the fantastic opportunity to save 20% on high street Gift Cards! It can be a wonderful programme to help you on your savings journey to save on your everyday purchases. Check out our website to learn more and to be aware of all our Terms and Conditions.
Addressing and overcoming bad financial habits is an essential step toward achieving financial stability and peace of mind, and it is possible! By understanding the emotional, psychological, and social influences that shape our spending behaviours, we can begin to make more informed and conscious decisions about how we manage our money. The journey to better financial decision making begins with acknowledging areas for improvement, setting realistic goals, and creating a consistent plan to achieve them. We all have goals we want to achieve in the future with our money and remember, it’s important to give yourself a pat on the back even with the small wins you make in your financial journey. Ensure to share this with your friends to lift each other up and take on the challenge together!
Why Choose Complete Savings?
At Complete Savings, our mission is to help you get more value from your everyday spending. Our cashback offers are designed to put money back into your pocket, giving you more freedom to enjoy the things you love. By shopping through our platform, you can take advantage of these amazing deals and more.