Mindful spending: 10 ways to save money and lower stress
Clinically reviewed by Dr. Chris Mosunic, PhD, RD, CDCES, MBA
Explore how mindful spending can help you save money, stick to your budget, and lower your stress. Plus, 10 tips to be more mindful about your spending.
It can be easy to spend money without much thought. The lure of online shopping deals and a few quick taps on a phone screen can lead to impulse buys rather than considered purchases. And if our spending habits are consistently misaligned with our financial goals, it can lead to stress. Mindful spending can encourage us to pause and think about each purchase, to ask why we’re buying something, and whether it aligns with our financial goals.
Developing a deeper understanding and more intentional approach to using our money with mindful spending techniques can help us stick to our budget. This can lead to a better relationship with money, reduced stress and anxiety associated with finances, and better overall wellbeing.
What is mindful spending?
When you’re mindful, you’re aware of your thoughts and feelings without getting caught up in them, so mindful spending is about making financial decisions with a clear mind, being present, fully engaged, and free from distraction.
Understanding whether your spending aligns with your personal values, goals, and financial situation involves pausing to think. Before making a purchase, consider whether it will bring real value to your life.
Key aspects of mindful spending
Intentionality: Making every spending decision deliberately, not out of habit or impulse
Awareness: Understanding why you’re spending money and how it affects your financial health
Reflection: Thinking about your spending patterns and adjusting them as needed
Alignment with goals: Ensuring your spending supports your broader life goals and values
Mindful spending can help counteract mindless spending, which often leads to self-sabotaging financial behaviors. Without mindfulness, it's easy to spend money in ways that feel good momentarily but don't contribute to your long-term happiness or goals.
By being thoughtful about where your money goes, you can make sure your financial resources are being used in the best way possible for your personal wellbeing. It can be a powerful way to take control of your life.
Differentiating between wants and needs in order to spend mindfully requires self-discipline, which is an important part of effective money management. Learning how to become more disciplined with mindful spending can help you make choices that make sense in the short term but also contribute to a healthier, happier, and more balanced life. It can support your financial health, personal fulfillment, and emotional wellbeing.
The benefits of money mindfulness
Embracing money mindfulness can transform your relationship with finances and benefit your financial life, your bank account, and your wellbeing.
1. Achieving financial wellbeing: Mindful spending can help you prioritize your financial goals and manage your money more effectively. Focusing on what truly matters can help you budget wisely, leading to a healthier financial state.
2. Increased awareness of spending habits: Regularly practicing mindful spending can heighten your awareness of where your money goes. Understanding your spending patterns can help you make more informed decisions.
3. Reduced stress and anxiety: Mindful spending can relieve stress caused by financial worries by giving you more control over your finances.
4. Letting go of financial regret: Mindful spending can lead to fewer impulsive purchases and reduce the likelihood of buyer’s remorse. Spending with intention means you’re more likely to feel satisfied with where your money goes.
5. Enhanced decision-making skills: With each thoughtful purchase, you strengthen your ability to make choices that are in your best interests, both financially and personally.
6. Alignment with personal values: Whether it's investing in experiences over things, supporting small businesses, or saving for future goals, mindful spending encourages you to spend in ways that reflect your personal values. This alignment can increase your feelings of fulfillment.
7. Improved financial relationships: Mindful money management can lead to healthier discussions and better financial teamwork with partners or family members.
10 mindful spending tips
Implementing mindful spending in your daily life can seem challenging at first, but these practical tips can make it easier to take a mindful approach to financial decisions. Try not to think of it as restricting your spending, but as making smarter choices that can lead to a fulfilling and stress-free financial life.
1. Track your spending habits
To begin mindful spending, start tracking your expenses, no matter how small. This can give you an understanding of where your money’s going and helps identify areas to make changes.
2. Pause before purchasing
Before every purchase, ask yourself whether this transaction is necessary, if it aligns with your goals, and whether it’ll bring you lasting satisfaction. This pause can be a powerful tool against impulse buying.
💙 Reflect on the urge to spend money by learning about Compulsion in this guided meditation with Tamara Levitt.
3. Identify your triggers
Recognize what drives your spending. Is it emotions, certain environments, or specific people? Understanding these triggers can help you avoid unnecessary spending and find healthier ways to cope with the causes of impulse buying or overspending.
💙 Learn how to identify your money-spending triggers and combat those Cravings to spend money unnecessarily through mindfulness and meditation.
4. Use cash instead of cards (when possible)
Using cash can make spending feel more tangible and real. Handing over physical money can help you become more aware of the amount you're spending than when you use credit or debit cards.
5. Set aside money for personal enjoyment
Allocate a portion of your budget for guilt-free spending on things that bring you joy. Setting aside money for experiences, items, or other indulgences that bring you joy are more fulfilling than frivolous spending.
6. Practice delayed gratification
Put items you want to buy on a wish list and wait a few days or weeks before purchasing. This delay can help you figure out if it's something you truly need or just a fleeting desire.
💙 Explore the idea of persistent spending coming from a place of Boredom in our series on Staying on Track.
7. Create a conscious spending plan
Instead of giving yourself a strict budget, make a spending plan that aligns with your values and goals. Plan to use your money in a way that supports your long-term objectives and personal fulfillment.
💙 Building Consistency in your spending habits takes time and effort to implement and achieve, but with some time and effort it’s possible.
8. Understand your financial goals
Be clear about your short-term and long-term financial goals to guide your spending decisions and help you prioritize your expenses.
9. Reflect on your purchases
Regularly review your purchases. Ask yourself if each item was worth it, and what you learned from each spending decision to improve your future financial choices.
💙 Try to practice Self-Compassion as you reflect on your purchases. This isn’t about judging or shaming yourself, but better understanding your motives and patterns.
10. Educate yourself about personal finance
The more you understand about personal finance, the better equipped you'll be to make wise spending decisions.
Mindful spending FAQs
What are the 4 types of spending?
Essential spending: This covers the things you need to live and function, like rent or mortgage, utilities, groceries, transportation, and healthcare.
Discretionary spending: Discretionary spending is where you have more freedom. It includes non-essential purchases like dining out, entertainment, hobbies, and luxury items. Mindful spending can make a big difference here, as these expenses are more about wants than needs.
Obligatory spending: These are the payments you're committed to, like loan repayments, insurance premiums, and taxes. Although they might not be essentials for daily living, they’re obligations you need to fulfill.
Emergency spending: This is for unexpected expenses such as car repairs, home maintenance issues, or medical emergencies. It's important to have a financial cushion or an emergency fund to cover these types of expenses without impacting your other spending areas.
What is a spending habit?
A spending habit is the regular way you manage your financial resources. It can include everything from how often you shop to the types of products you typically buy, and even how you react to sales or discounts. These habits can be deeply ingrained, making them challenging to change. However, becoming aware of your spending habits can help you adopt a more mindful approach to managing your money.
What is obsessive spending?
Obsessive spending, also known as compulsive buying disorder, is a pattern of chronic, repetitive purchasing that becomes difficult to stop and can bring harmful consequences. People with this disorder often buy things they don't need and sometimes can't afford. It can lead to significant financial, emotional, and relationship problems. Treatment might involve cognitive behavioral therapy and developing healthier coping mechanisms.
What is the 50-30-20 rule?
The 50-30-20 rule is a simple budgeting guideline to help manage your finances effectively. It suggests dividing your after-tax income into three categories to help you enjoy life and secure your future without overspending.
50% on needs: Allocate half of your income to necessities, like housing, food, utilities, and transportation.
30% on wants: Use up to 30% for discretionary spending such as travel, dining out, and entertainment.
20% on savings and debt repayment: The remaining 20% can be saved, invested, or used to reduce any debts beyond the minimum payments.
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