海角大神

A simple tool to save you big bucks: impulse control

It's easy to buy something on impulse, but can be harder to face the credit card statement later. You don't need to eliminate all impulse buys, but do put limits on them.

As I鈥檝e mentioned on here several times, I have a weekly piano lesson, something I enjoy very much. On my way to my lesson, I drive by a bookstore and a game shop. On my way home from my lesson, I drive by that same bookstore and same game shop.

Every week, especially on the way home, I鈥檓 tempted to stop. I see the game shop coming up on the right and I get an impulse to stop there. I see the bookstore a little bit later on the left and I get an impulse to stop there.

Yet, almost always, I resist.

Five years ago, I would have stopped, almost every time. I would have went into the game shop, thought about my friends, and picked up a new game to play with them (even though I have quite a few already). I would have stopped at the bookstore and picked up a few new books to read (even though I have a book backlog right now).

Today, at most, I鈥檒l stop once every two months at one or the other of the shops, and even then, rarely do I walk out of the store with an item. If I do buy at such stores, I usually walk in the door knowing exactly what I鈥檓 looking for and walk out the door with just that item.

What caused this (hugely financially beneficial) change? Aside from the trite answer of 鈥淚 just changed my perspective on life,鈥� I found that a handful of tactics really facilitated this change.

Avoid impulsive moments
For me, the best immediate move to make was to simply get myself away from impulsive moments. I started driving a different route to work. I avoided social activities that revolved around buying stuff. I started even re-evaluating my hobbies in order to seek out ones that didn鈥檛 encourage impulsive buying (like walking in the woods, for example). The biggest reason for doing this was to simply break the cycle of impulsive buying.

Reflect (at length) on the times when you give into your impulses
If you do discover that you鈥檝e given into an impulse, spend some time thinking about that event and why it happened. Why did you spend that money? Are you really happy with that purchase? What can you do to make sure it doesn鈥檛 happen again? You don鈥檛 need to beat yourself up over it, but you will find great reward in thinking about the 鈥渨hy鈥� of the matter, as it will lead you towards not repeating the mistake.

Minimize your stress
When you鈥檙e stressed, you鈥檙e more impulsive. I certainly observe this in my own life 鈥� when I feel a lot of pressure and stress, I usually just seek immediate ways to relieve it, even if it鈥檚 not a good long-term choice. A new game or book feels good, so I鈥檒l sometimes fall right into that. Thus, it鈥檚 useful to seek out ways to reduce the amount of stress in your life. I meditate, pray, play games, read, and play with my children 鈥� all of these help me de-stress.

Be accountable to someone else
This is particularly easy if you鈥檙e married. The way we do it is by having completely open bills 鈥� credit card statements, bank statements, and other such things are reviewed by both of us. Because of this, it鈥檚 impossible to 鈥渉ide鈥� things 鈥� we have to be fully honest with each other. If you have a spouse, I highly recommend this. Of course, if you don鈥檛 have such a partner, you may have more difficulty doing this 鈥� a trusted friend, perhaps.

Allow yourself some impulsiveness 鈥� but keep boundaries on it from the start
My wife and I each have some leniency when it comes to impulsive buys. We essentially each have an 鈥渁llowance鈥� with which we can each buy whatever we鈥檇 like. Often, I鈥檒l buy a game or a book 鈥� my wife usually buys a book. This 鈥渁llowance鈥� often gives us just the freedom we need to not have a sense of being deprived while also keeping very good control over our personal finances.

Use the ten second rule and the thirty day rule
The 鈥渢en second rule鈥� basically means that you should spend ten seconds thinking about any purchase you鈥檙e about to make before making it. This helps you to reflect on potential impulse purchases and often put them directly back on the shelf. The 鈥渢hirty day rule鈥� means that you should spend thirty days before buying any item that costs more than a certain threshold 鈥� say, $25. This prevents you from drowning yourself on an expensive impulse buy.

What鈥檚 your impulse?
Most of us have impulses that work in opposition to our financial goals. We buy gum or a bottle of soda at the checkout. We pick up a DVD. We buy some new clothes. We purchase a new gadget or a new book. Most of the time, these decisions are heavily impulsive 鈥� done on the spur of the moment 鈥� and we often feel bad about them later, particularly when we find we鈥檙e not using them much and now we鈥檙e facing a bill that we can鈥檛 easily handle.

Breaking free of such impulses can have a very large and dramatic effect on your finances. It becomes easier to budget and plan ahead. You suddenly have more resources each month with which you can save, pay off debts, or invest for the future. Best of all, you find that you value the things that you do buy a lot more than you used to.

Impulse control is an essential tool for personal finance success.

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