Money, money, money, this is what’s on everyone’s mind these days. Especially during these economically sensitive times we are living in, everyone is keeping a close on their bank accounts. With millennials being the largest generation in the workforce in the United States, they understand how crucial it is to closely monitor their finances. Mindful spending is an absolute must more than ever.
Using these 6 money-saving habits can help them evaluate their finances to start saving money.
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What exactly is mindful spending?
The most essential component of mindful spending is self-awareness and understanding how much you should truly be spending on certain things. When someone is able to acknowledge where they are financial, they can start to make better financial decisions that wouldn’t lead to unnecessary stress. Being able to emphasize the practicality of how someone should be spending their money. And since millennials are one of the biggest spenders in America, it’s only a matter of time before all those impulsive purchases catch up with you.
1. Check on your subscriptions.
Almost everyone from the ages of 18 – 40 are subscribed to a service that charges them monthly for their service, but there are a few of us that no longer use that service and still subscribe. Forgotten subscriptions are very common with millennials since many of them don’t even recognize the charges being made until it’s too late.
Peek into your checking account and see if you are able to recognize all the charges being made to it. Businesses make it very easy to subscribe then they do to unsubscribe. Subscription tracking apps are a great tool to help you locate and manage your monthly plans, FOR FREE!
Apps for tracking online subscription:
- RocketMoney : Basic plan is free, Premium is $3 to $12 per month
- PocketGuard : Free, upgrade to premium for $4.99 per month
- Bobby : Free standard plan, $0.99 to $2.99 for unlimited
- YNAB : Free for 34 days, pay $84 per year
2. At-home café.
It shouldn’t be surprising that millennials are the coffee-loving generation. With Starbucks being their main location for their much-desired brew. The average cost of coffee in America in 2022 is around $ 2.30. While this might not seem like a minimal expense for your daily cup of joe, it can easily add up, especially for avid coffee drinkers. According to yahoo news, women spend about $2327 per year, while men are paying $400 less.
Research has shown that depending on where you live, buying coffee daily will cost around $1 to $5 dollars but making it your own will only cost you between 16 & 18 cents. For some spending 5 dollars daily isn’t that crucial but for others, that can quickly add up. With the help of mindful spending and watching a couple of brewing tutorials, anyone can save hundreds of dollars a year by making their cup of joe at home.
3. Save it to your Wishlist.
Shopping online has to be one of mankind’s greatest innovations, if you were to ask someone in their 20s. The convenience to have what you’ve been wanting in your hand in less than 48 hours can make some adults feel like a kid waking up on Christmas morning. But having this incredible option at your fingertips can lead to a lot of unnecessary purchases.
By creating a wish list, you are allowing yourself more time to think before proceeding to checkout. Instead of buying something immediately, bookmark that item and continue t look around. You might be able to find it for cheaper somewhere else or even find a cheaper alternative.
Some people even use their wish list as a goal of how much they need to save in order to buy whatever it is they want. Saving your purchase for later gives you time to sort out your finances accordingly before you spend your money.
4. Luxury vs Necessity.
Society has perfectly branded in your minds that the more expensive something is, the more it can make you seem like a higher-value individual. Being able to possess items that many believe are what the rich would buy allows us to believe we are like them too. this type of marketing leads many lower-earring people that if they buy this “exclusive” item they too can seem like they are rich.
This is a common form of deceptive marketing, which is how many brands mislead their customer by persuading them that what they buy will make them be someone they are not.
Once someone is able to comprehend that what they want isn’t want they need, they can start making smarter purchases. Being able to fully evaluate if a purchase will benefit you long-term vs momentarily can end up saving you thousands.
Here is a list that describes different types of economic goods.
- Normal Goods: A normal good, also called a necessary good, doesn’t refer to the quality of the good but rather, the level of demand for the good in relation to wage increases or declines.
- Luxury Goods: A luxury good means an increase in income causes a bigger percentage increase in demand. It means that the income elasticity of demand is greater than one. A luxury good is also a normal good, but a normal good isn’t necessarily a luxury good.
- Inferior Goods: An inferior good occurs when an increase in income causes a fall in demand. An inferior good has a negative income elasticity of demand. (YED) Inferior goods are characterized by low quality – and are goods with better alternatives.
5. Control the impulse.
For many of us, just being able to go into a store and only get wants on your list is practically impossible. It’s almost like each aisle you walk down has something that catches your eye and if would be crazy not to get, right? WRONG! This is a common excuse for all impulse buyers.
Not being able to stay disciplined to your original list could have you spend hundreds of dollars on things you do not need. It’s recommended that before your swipe your card or put into your card’s details, take 5 minutes and rethink everything in your cart. One of the main causes of impulse buying is the fear of missing out on a good deal. This is just a marketing tactic to put pressure on customers to buy something now if they want the best deal. If you don’t need it now then just put it back until you do.
Being able to spend mindfully means you are going have to be honest with yourself and your money. This can be a hard truth to face, but living a lifestyle that is beyond your means will only add stress to your life. Once your able to get a better understanding of your finance your will be able to control how stable your lifestyle can be. This control will allow you to save much or and reach your finical goals.