A few years ago, when I was still in college, I had a full class schedule. On Thursdays, I was in class from 8am to 3pm, and then I had an hour in order to get across town to teach dance classes starting at 4pm into the night. It didn’t take me a full hour to drive from my campus to the dance studio, so I usually would take the extra time to study or run a few errands. One day in the middle of the semester, I decided to stop by Starbucks and treat myself to a white mocha frappuccino. It was delicious and the caffeine boost was exactly what I (thought I) needed to keep myself going.
Fast forward a month and I was going by Starbucks almost every afternoon to pick up a drink. Sure, it cost $4 a pop, but for the added boost in productivity, I considered it money well spent.
Right about the time the semester ended and my dance classes were finished, the AC in my car went out. I live in Alabama – AC is pretty much non-negotiable. It was a costly fix (about $1300) and I didn’t have all the cash at the time. I had to look at my budget and cut it to the bare bones so I didn’t have to go all summer without AC (although it did take a solid 2 months to save up for!). First item on the chopping block? That Starbucks stop. Guess what? Once I quit going, I realized that it wasn’t doing anything for me productivity-wise: it was just a want.
When you do unnecessary spending on a regular basis on a particular item/service/luxury, it no longer becomes a treat – it is now a habit. These habits usually start innocently enough, but they can be real budget busters if you are looking to slim down your budget.
One frugal trick that I have learned is to take something that you normally would have unnecessarily bought without thinking about as a habit (like that coffee) and turn it into a treat. Typically, if someone is able to have a little wiggle room in their budget, they assign themselves a small portion of it as “fun money”. Even if you don’t have a portion of your budget set aside for fun things, you can save yourself a little money if you take those small things that you do on a regular basis (expensive coffees out, restaurant meals, getting your nails done, a new book/cd, a new video game, a new item of clothing, etc.) and make it become irregular.
Now, don’t get upset – I’m not saying you should never “treat yourself” or never have any money in your spending plan for fun (more on that in an upcoming post). That’s just unreasonable. Rather, is it really a treat if you get your nails done every two weeks? If you buy a new hardback every paycheck? If you get a coffee out 3 times a week? In my book, I would consider those things habits, not treats. You grow accustomed to them and expect them. Instead of it being a little luxury, it becomes an expectation and you lose a degree of enjoyment. All I am asking is that you take a discerning eye towards where your money really goes: are there items that you regularly spend for small indulgences on that could maybe be cut back on in order to free up money for debt repayment or savings?
By turning a habit into a treat, I think three essential things happen:
1. You have more money to reallocate to other areas, whether that be debt repayment or savings.
2. You will be living a simpler life and may stretch your creative muscle in order to find more frugal ways to fill that void – and in the process, you might find something that you like better!
3. When you do treat yourself to something, your levels of appreciation and enjoyment skyrocket. Something that may have once been routine has suddenly become a luxury.
Here are a few things that I used to do regularly that I have cut back on at different times in the past in order to beef up my savings: haircuts, coffees out, music/cd/album purchases, any new books (only used), clothes, fancy makeup, going to the movies, getting my nails done (this was pretty rare to begin with – usually only 1 or 2 times a year), buying video games, eating out, buying magazines, and so on and so forth.
How do you feel about treats vs. habits? Are some of them items that I mentioned truly a treat for you, or is it just another line item in your budget?