A couple of months ago, my former colleague Alice asked me if I had any advice to help make her more disciplined to be better with her finances. I told her that I thought she was a reasonably disciplined person, but that she needed to change her environment to make it more saving and frugal-friendly. As someone who has spent months losing and keeping weight off, I asked Alice if she kept cookies and chips around all the time to tempt herself and test her willpower. She of course does not, and instead keeps an array of healthy foods around so that she can prepare healthy meals and snacks.
I see financial behavior in the same way. Too many people surround themselves with temptations for spending, splurging and wasting money; and then feel guilty because they gave into the temptations. When I left the corporate world and large corporate paychecks behind, I phased in a number of steps to create a frugal friendly environment. This is what I outlined for Alice:

–Stop using shopping as a hobby– Rather than tempt yourself, cultivate newer habits that don’t involve substantial spending such as hiking, going to public parks and museums and taking advantage of community concerts.

–Rid yourself of overwhelming temptations–catalogs with fancy clothes or swanky electronics or furniture can cause you to feel the urge to pull out the credit cards. Better to eliminate these altogether.

–Arrange group outings around activities that encourage lower spending levels — if you meet a group of friends regularly for a meal; go out for lunch or brunch instead of dinner; or better yet have a potluck.

–Set your savings and debt payment plans on automatic — rather than giving yourself the latitude to spend money before you have a chance to fund your savings or retirement, pay yourself first.

–Carry a limited amount of cash if you have problems staying within spending limits — many people find that not having the money is the best way to keep them from spending more

In recent weeks, Alice has done really well. She’s spent much less, especially on clothes and gifts, than before and has arranged to have retirement savings taken out of her bank account each month. She’s also managed to keep chocolate ice cream out of her freezer. Go Alice!

Source: Modern Gal