Psychological Tricks You Can Use To Save Money
Sometimes the only way to get yourself to do something that you know is good for you, is to psychologically trick yourself into doing it.
Why is this? Because our brains have been shaped over millions of years to repeatedly do the things that give us instant gratification even though those things aren’t always to best for us or healthy.
So here are some mind tricks to get past your psychological urge to spend, spend, spend.
#1. Use Automatic Deductions
I learned this one while reading The Richest Man In Babylon, whenever you get paid or some extra money turns up in your life, save a chunk of it.
I like to save 70% of what I earn but you don’t need to be that hardcore about it, I find that 20% is doable for most people.
If you can use an app or tell the place where you work to automatically deduct 20% of your money and put it into a separate account, the money will start piling up without you even missing that cash.
Almost anyone can get by comfortably on 80% of what they make because a lot of people just blow their extra money on frivolous things. You don’t need to go out to eat every day and you don’t need a new shirt this week. Shaving a bit of your money off to invest it into your future also has the great side effect of making you think twice about your spending habits.
In due time, you will have money to invest and earn money for you over time or you can use it for an emergency fund in case times get tough.
#2. Convert The Price Of Things Into Hours Worked
The way I think of a normal job, is that you are trading your time for money, so following that logic; If you get paid 12 dollars an hour, how much is a 40 dollar shirt costing you?
The answer is your trading just under 40 hours of your life for a shirt that isn’t even going to look good in a few months.
Converting the price of things into hours worked really opens your eyes to how much people are wasting their time on this earth, people making 8 bucks an hour are blowing their money on 30 dollar meals, I don’t even want to do that math on that one, it just sounds painful.
P. S. Instead of letting this idea cause you existential dread, use this knowledge to get out of the trading hours for a set amount of money and start your own business, yeah you don’t make money right away so it will feel like you are trading hours for nothing, but you will eventually make enough money that it will all have been worth it and you’ll think why doesn’t everybody do this?
#3. Create Extra Spare Change To Save
What does this even mean? There is an app called Acorns that makes it super easy for you to save and invest money.
It works by rounding up whatever charge you have to the nearest dollar, so if you buy something that is $5.50, Acorns will round that charge up to $6.00 but it will save the extra 50 cents, so every time you spending with your card, you are also saving.
this extra money gets deposited and invested so eventually your spare change is not only being saved up but is making money for you as well.
Again like the first method of automatic deductions, the money getting saved won’t be missed, after all when we buy something with cash we get change too but it isn’t being invested like it would with Acorns, it just sits there in your piggy bank or ashtray.
In Conclusion
There are many clever ways to trick yourself into saving money, you just need to actually implement them into your life, I’ve chosen the easiest ones I could find and if you use them, a positive change is going to come out of it.
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Originally published at https://forgefinancialfreedom.com on November 8, 2019.
