How to stop spending money

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Some spending is, of course, necessary, but overspending can be problematic when you’re trying to grow your savings or clear debts. If you find yourself regularly buying things you don’t need or if you’re spending more than you earn, it’s time to learn how to stop spending money.

In this article, we’ll discuss some key strategies to help you stop spending money unnecessarily. Whether you’re trying to save money on a tight budget or you’re managing comfortably but have a specific savings goal, our top tips will help you to achieve your financial objectives.

How to stop spending money: key areas to consider

The importance of budgeting

Before you can curb your spending, you’ll need to track your existing monthly expenditure. Review your outgoings for 30 days to determine where your money is going and how much you’re spending. This will help you identify areas where you can cut back on your spending and establish how much money, if any, you have left over before payday. Online banking and banking apps provide an easy way to monitor your outgoings and that all-important bank balance.

Once you have a good grasp of your income and outgoings, you can then set a monthly or weekly budget. By drawing up a budget you’ll know exactly what you can afford to spend during the month, which is essential if you want to avoid getting into debt. Be sure to review your budget regularly to check whether your spending is within your set limits.

A budget planner doesn’t have to be complex and you can even use our free budget planner to guide you. There are also various apps available to help you track spending and manage your budget.

Living within your means

If you’re frequently going over budget or wasting money, then it’s time to rethink your priorities. Prioritise essential spending, such as your mortgage or rent, household bills, food, clothing and transport costs. After that, you’ll need to think carefully about what matters most to you and make your spending decisions accordingly. You’ll most likely need to make some sacrifices but the benefits will be worthwhile. For example, foregoing your £15 weekly takeaway could save you £780 over the year.

It’s also important to approach your spending with a realistic mindset. Most people would love an exotic holiday or top-of-the-range car, but your ideal lifestyle should not be allowed to dictate your finances. Instead, focus on how to have the best lifestyle you can within your existing budget. That’s not to say you can’t enjoy a few luxuries occasionally – you just have to accept that you’ll need to be patient and save.

Understanding your spending triggers

If you want to stop spending money on unnecessary things, you need to understand the triggers that cause you to spend in the first place. Are you more tempted to impulse buy when you feel upset or anxious? Perhaps you’ve made a habit of popping into the coffee shop on your walk to work. Or do you spend more when you’re with certain people?

Identifying and removing these triggers, whether psychological or emotional, is key to reducing your spending. For example, if you tend to spend money when you’re bored, try to keep busy. Go for a run, clean the house or do some baking – it doesn’t matter what you do, just stay active and resist the temptation to spend.

12 top tips to spend less money

1. Set some goals

If you want to stop spending money, it’s a good idea to set some clear, quantifiable goals. This will help you to stay motivated and maintain discipline. Whether you’re saving for a wedding, a deposit for a house or a new car, you can have a clear, set amount that you want to reach. Once you ring-fence your money for a specific purpose, you’ll be less likely to waste it on non-essential purchases. You could even put a list or photo in your purse or wallet as a reminder of the reason why you’re changing your spending habits.

Even if you don’t have a specific objective in mind, setting some simple short-term financial goals will help you to stay focused. It could be something like “I want to reduce my food spending by £50 a month” or “I want to save 10% of my monthly salary”. Whatever goals you choose, make sure they’re attainable and keep a reminder at hand.

2. Calculate the true cost

Whenever you’re tempted to spend, work out the true cost of your potential purchase. You can do this by calculating how many working hours it would take you to earn enough money to pay for that item. For example, if your purchase costs £160 and you earn £10 per hour, that’s 16 hours of work. That ‘must-have’ item can suddenly seem less appealing when you calculate its true value to you.

If you’ve set a specific savings goal (see above), consider how much longer it might take you to reach this goal if you were to cave in and make that purchase. For instance, if you’re saving for a baby, the £300 watch you have your sights on could pay for a cot. This change of perspective can deter you from spending money you might later regret.

3. Wait before buying

If you’re tempted to make a big purchase, give yourself at least three days to think about it. Take the time to consider your potential purchase and ask yourself some key questions: Do I really need it? Will I use it? Can I afford it? And can I find it cheaper elsewhere?

If, after the three-day waiting period, you still want the product (and you can afford it), then go ahead and buy it. However, once the rush of impulse shopping has worn off, you might decide you no longer need the item. Although it can be challenging, imposing a mandatory waiting time is a great way to spend less money and prevent those budget-busting impulse buys.

4. Say goodbye to the credit card

Spending on credit cards can easily snowball, often resulting in expensive interest payments and debts. Avoid the temptation completely and leave any credit or store cards at home before heading to the shops. Put them in a place where you can’t easily access them or, better still, cancel them. Remember, until you’ve paid it off, you’re technically spending someone else’s money.

And if you’re a keen online shopper, don’t forget to delete your card details from online shopping sites. Saving your payment details might make the checkout experience more convenient but it also makes impulse spending that much easier.

5. Only take cash

Want to limit your spending? Then opt for the simple solution and only take cash. With no credit or debit cards to fall back on, you’ll only be able to spend as much as you physically have in your purse or wallet. It’s an easy way to prevent those unplanned purchases that can push you over budget every month.

6. Curb your food spending

Food might be a necessity, but it’s also an area where it’s easy to overspend. The good news is there are plenty of ways to reduce your food spending. As a starting point, plan meals and prepare a shopping list before heading to the supermarket. That way you’ll know exactly what you need and will be less likely to buy unnecessary items. And never go food shopping when you’re hungry as the temptation to impulse buy will be that much greater.

Eating out is another area where you can cut back. Swap expensive coffee-shop drinks for homemade alternatives and take a packed lunch to work rather than stopping at the local sandwich shop. It might involve a little planning and preparation, but your bank balance will thank you for it.

7. Remove temptation

It might sound obvious, but if you want to stop spending money, avoid unnecessary trips to the shops. Stay at home and take up a new hobby or do some volunteering instead. Keeping busy means you’ll have less time to go shopping and overspend.

You can also remove the temptation to spend by unsubscribing from retailers’ emails and catalogues. If you don’t see their latest product offering, you can’t be lured into buying it.

8. Declutter your service subscriptions

It’s good practice to regularly review all of your subscriptions to identify areas where you can stop wasting money. You might find you’re paying for memberships that you rarely use. You can usually cancel them by logging into your online account or contacting your service provider. You could also cancel the direct debit with your bank directly. Find out more about cancelling recurring payments here.

If you’re serious about curbing your spending, ask yourself whether the services you do use are really worth the extra money. While you might enjoy going to the gym or watching the occasional Netflix documentary, they might be luxuries you can live without. If you really can’t bear to part with your TV or music subscription, consider sharing the service with another household and splitting the monthly cost between you.

9. Borrow instead of buying

If you’re looking to buy something for a one-off event or short-term use, consider whether you can borrow the item instead. Whether it’s a fancy-dress costume or a hedge trimmer for the front garden, it’s worth asking family, friends and neighbours if they would be willing to lend it to you. Or why not see if there’s a Library of Things in your area? You can often find a whole range of useful household items available to rent for a small fee.

If you really need to buy something new, you could sell something you already have to cover the cost. Not only will this minimise the chances of overspending, but it will also help you to keep on top of household clutter.

10. Collect spare change

Classic tips are often some of the best, and collecting loose change is no exception. At the end of the week, empty your purse or wallet and throw any spare change into a designated jar. While the odd 50p here or there might not seem much, it’s surprising how quickly it mounts up over the year. You could even label the jar as a reminder of your savings goal, for example, “new car” or “honeymoon”.

11. Do it yourself

Paying someone to wash the car, mow the lawn or clean the windows? If so, then it might be time to knuckle down and get your hands dirty. Yes, paying someone else to do these jobs is convenient, but if you want to stop spending money then try tackling some of these tasks yourself. It takes a bit of time and effort, but it’s an easy way to reduce your monthly expenditure.

12. Take on a no-spend challenge

If you’re looking to break your spending cycle, try taking on a no-spend challenge. A no-spend challenge refers to a set period of time when you stop spending money on unnecessary things. As part of the challenge, you’re only allowed to spend money on essential, budgeted-for expenses such as your rent or mortgage, bills or food shopping.

Whether it’s for one or two days a week or a whole month, taking a self-imposed spending hiatus is a great way to break old habits and kickstart your new approach to money. Not only will you save money by eliminating non-essential purchases, but you’ll be able to identify areas where you’re leaking cash.

Now you know how to stop spending money, what’s the next step?

Hopefully this guide has given you a few ideas on how to spend less money. Now you’ve mastered the art of mindful spending, it’s important to put all that effort to good use. If, after implementing these strategies you find you have some spare cash, put it towards clearing any credit card debts, bank loans and overdrafts.

You can then start thinking about building your savings pot or increasing your pension contributions. Raisin UK gives you access to a range of competitive savings accounts from our UK partner banks. Simply register for a Raisin UK Account to quickly and easily apply for free today.

Reforming your spending habits takes discipline and patience, so don’t be disappointed if you give in to temptation now and again. Changing your approach isn’t going to happen overnight but, with time, it is possible to learn how to stop spending money and achieve those all-important financial goals.