A popular trend in the health community is cleansing – setting aside a week to 30-days dedicated to reigning in bad eating habits, losing weight, finding energy, or maybe just feeling better. Cleanses can help people reach short-term health goals faster, change their eating habits, and find new motivation to turn short-term discipline into a long-term lifestyle.
Imagine what could be done if more people applied this concept to purging out the bad things “feeding” their finances – a financial cleanse, if you will. Setting aside time to focus on money habits can make a huge impact on short-term financial health and provide just the motivation to kick bad habits, get your finances in order, and keep them that way. Here are a few tips you might want to try if you’re considering taking a summer financial cleanse.
- Clean out your financial refrigerator: identify and eliminate spending temptations.
One of the first steps people take when starting a cleanse is to get all the junk or off-limit foods out of their refrigerator and cupboards. By removing these immediate temptations, you’re showing you mean business and intend to stay on track. This same concept can be applied to your finances – specifically, things you have ready access to that tempt you to spend wastefully, compulsively, or out of boredom (just like a refrigerator full of junk food).
For me, one of the greatest spending temptations is getting emails with coupon codes from my favorite stores. Just when you find something you ‘need’ to use one of them on, they send you another coupon. Hitting unsubscribe, unfollowing, or even turning off your social media can help you purge these sources of temptation.
- Keep a food diary: record everything you spend.
Just as someone who goes on a cleanse might record everything they eat during the day to keep themselves accountable and reveal things that are sabotaging their goals, recording everything you spend can offer the same accountability and insight into your unconscious financial habits.
Using cash is one of the best ways to do this, but if you use a credit card for the points and rewards, you can still track your spending with an app, spreadsheet, and other tools. The idea is to get a better idea of where your money is going. You might be surprised to find that you’re spending way more than you realized in a specific category.
- Cut the calories or carbs: focus on one category you need to correct.
Cleanses are often focused on cutting or reducing calories and food sources. For instance, during a Whole 30 cleanse, participants cut out grains, dairy, added sugars, and other processed foods. With the insight gained from recording all of your spending, a financial cleanse can be further enhanced by cutting back one of the categories you’re splurging on a little too much. This might be entertainment, eating out, or buying lotto tickets and snacks every time you hit a fuel station, or something entirely different.
By focusing on correcting one aspect of your finances, it’s easier to gain a sense of accomplishment, which builds confidence to tackle other categories, as well.
- Separate your needs from your wants.
Once you’ve identified some of the problem categories, it’s time to look back at the essentials. During a health cleanse, this might mean ensuring you’re getting the essential amounts of protein, vegetables, or fiber in your diet before you “spend” on empty calories and treats. For a financial cleanse, this means looking at the category we all dread: bills.
Getting familiar with how much of your income is allocated for essential spending, compared to discretionary spending, can help you identify areas to work on in order to create a bigger gap between the two. The bigger that gap, the more you can start saving and planning for the future.
It might seem like a stretch to apply the concept of a health cleanse to your finances, but try these tips and see if they help you cut unnecessary consumerism and spending, energize your budget, and motivate you to pursue a healthier financial lifestyle.