5 Simple Steps to Beat Impulse Spending

Hey there! Are you tired of feeling like your wallet has a mind of its own, always emptying itself faster than you can say "splurge"?

This situation is made worse because according to Trading Economics, Canada's household debt-to-income ratio is approximately 175%. This means that for every $1 of income earned, Canadians spend $1.75 on the average therefore relying on debts to cover the shortfall.

Picture this: you're strolling through the mall or scrolling online, you stumble upon that "must-have item". Before you know it, you've swiped your card, and then the thrill of the purchase is replaced by buyer's remorse. Sounds familiar?

Impulse spending can be a tricky habit to break, but there's always a way to regain control. Let’s embark on a journey to financial security by following a few logical steps.

⚡ Step 1. Recognize Your Triggers

Identify what prompts your impulse buys. Is it stress, boredom, or perhaps those enticing "limited-time offers"? Knowing your triggers can help you devise strategies to avoid unnecessary purchases.

📝 Step 2. Create a Spending Plan

A spending plan is a part of your budget and an essential tool to your financial freedom. Allocate funds for essentials, savings, and a little fun, but make sure to stick to it. Track your expenses and adjust as needed to ensure you are living within your means.

🧘🏽‍♀️ Step 3. Practice Mindful Spending

Before making a purchase, pause and ask yourself: Do I really need this? Can I afford it? Will it bring long-term fulfilment? This pause can help you make more deliberate choices and avoid impulsive buys.

⏸️ Step 4. Implement the 24-Hour Rule

For those tempting purchases, apply the 24-hour rule: wait a day before buying. This cooling-off period often reveals whether you truly need the item or if it was an impulse. If the urge to buy reduces, then consider not buying the item and saving/ investing instead.

📲 Step 5. Use Technology to Your Advantage

Apps and tools can help monitor your spending habits. Set alerts for when you're nearing your budget limits, or use apps that round up purchases and save the change to subtly boost your savings.

Learning to overcome impulse spending is not only about saving money, but also about gaining peace of mind and taking control of your financial life. We understand the challenges you may face and are here to support you with personalized solutions to help you reach your financial goals.

Your journey to financial independence starts here!

Additional reading: Recent developments in the Canadian economy: Fall 2024