To ask how you change your mindset when it comes to money

[isitjustmine]

Really looking to change my financial situation this year but I'm really struggling with actually changing my mindset when it comes to spending.

The temptation to spend is ridiculous and I have no self control whatsoever. Can't ever seem to say no to a takeaway, a meal out, clothes, other treats etc.

AIBU to ask how to change? It seems impossible

I know OP, I'm setting 2020 as my year to become financially organised. My plan is....

1. Two separate accounts, with my salary into one and dhs into the other.
2. All direct debits come out of one of those, with whatever remains left to build up.
3. The other account is our transient spend account.
4. Dh and I get an allowance on the 1st of the month for fritter money (if we want to buy work lunches, coffees out, clothes, nights out etc).
5. I've opened a Monzo account for my fritter money. It instantly shows you your balance, splits your spend into categories so you know where your money is going.
6. Be more prepared in packing lunch for work and using my travel mug for home made coffees.

Spreadsheet.

Split into two halves. One for bills, one for discretional spends. On the same sheet.

Top half, the bills. Input exactly what is forecast.

This includes grocery shopping etc.

At the bottom put your incoming money.

First month, spend as normal.

Then evaluate everything you've spent. See where you overspend.

I have a formula that calculates it all as I go. Every couple of days I log into it, and update with any spending. The bottom figure on that sheet has to match the money in my bank account.

It's all about accountability for me.
Also it means I value every penny. Say next month I know I have £2000 coming in, but £950 is for bills, then the surplus is mine. But the month after I've already predicted (based on a normal salary payment) I'll have £1400 coming in and £950 bills, I know it's best to make extra big spends next month and not the month after.

I think it's changing your thinking from saving as a goal to a commitment. Instead of saving leftover money, choose an amount to save, treat it like a bill and spend what's left from that.

@Kelsoooo This is a really good tip but unfortunately I'm shit at doing spreadsheets and formulas!

What do you want to change? eg, do you need to get out of dept, save for a rainy day, save for a deposit etc?

What I do is when I get paid I put a chunk of money into my savings account straight away (how much depends on the month - how much I've earnt and if I think its going to be an expensive month etc), give some to DH for our bills account (again how much depends on the month), and the rest is mine to spend.

If I haven't spent much I'll put more into my savings account the next month.

@Camomila Mainly just save for a rainy day. I would like to have some funds behind me in case of emergencies etc

I keep getting ads for a money app called Yolt - I haven't used it, but it looks like you divide up your spendings into different categories and set a budget. The app keeps track of what you're actually spending.

isitjust

A notebook would work just as well and can be carried around with you.

Draw a line down the middle, each day of the month at the edge of each row. On the left, list everything that is set to come out (direct debits etc). On the right put your salary and any other income in the relevant dates.

Work out the balance between the two and write it at the top of the page in pen.

As you spend each day, add in into the left hand side and keep a total in pencil next to the pen written amount. Make sure the pencil amount never goes above the pen amount.

I was exactly the same. I am reformed now!! And it feels great to be in control.the thing that helped me and I still do it is every penny I spend goes on to a simple spreadsheet...one page for each month. I can see exactly how much I have spent and on what. Then my goal was to reduce the spending each month.

I saw a piece of advice once to work out the value of your time. I.e. if you take home £20k a year after tax and spend £18k on basic living then you have £2k a year of disposable income (Adjust numbers and savings targets as appropriate). Assuming you work 260 days a year you will have £7.69 per day of disposable income.
So if you want that amazing Zara dress for £35 you are gonna have to work full time for just over a week to get it... do you still really want it?

I actually think it is quite hard to ‘change your mindset’. I am the opposite to you, mortgage paid off, substantial savings & investments but I am so frugal that I find it hard to spend money , I hate spending on eating out, I am a decent cook so I know I can cook more cheaply at home yet I miss out on the ‘occasion’ of eating out. Same with holidays, I can afford them but I think ‘what am I getting out of this’ all the time. Not sure what the answer is.

Making the decision to want to change your mindset is your first step and you have done that.

Meal plan, so you don't get a takeaway. Take packed lunch to work.

If you have debt, then adopt a plan to become debt free.

Listen/Watch motivational podcasts/videos, such as Top 10 Debt Free Screams: When you hear that others can do it, you start to believe that you can too.

Set achievable goals. You may be used to setting goals in your job, if so then adapt whatever goal structure you use to fit.

@Ragwort Teach me! I really wish I was frugal but I'm the total opposite.

I use an app called money dashboard. It's great. You set up budgets using buckets and then it uses open banking to import transactions from your bank accounts and credit cards. I find it great because it means I account for credit card spend in the months I make it not when I pay the bill. When transactions come through it tries to allocate items to buckets automatically. Sometimes I need to tweak them.

It means I just have a single bank account but see all my budgeting pots. It really helps me see where my money is going!

Set amount of cash out at the beginning of the week to spend on everything other than main bills? Then tuck your card away until the next time you take your cash out?

When you physically have the cash in your hands it makes what you spend a lot more real - especially if you are spending it on things like takeaways.

Use a separate bank account for all your bills and food using a set budget - when you get paid transfer in the months money immediately

Transfer 75% of what is left into a instant access savings account rest is your pocket money for the month - if you’re anything like me the buzz you get seeing savings grow puts a check on my spending - having to transfer the funds to current account to splurge is sometimes enough to make you change your mind

Buy an old fashioned note book.
Get a pen
Write down everything you you purchase or pay for, everyday.
Include dds and sos
You will be horrified
But you will also be empowered. Work out what life costs, see what money comes in. Monitor what goes out

Take control. You can do it.

Depends on your situation. Getting an offset mortgage totally changed my mindset and spending habits.
£3.00 a day on coffees isn't much, but over the working year that's around £650 off my mortgage.
Factor in bought lunches and there's over a grand.
You need to work out what you're spending and where.
Meal planning helps too.

I know I am terrible at dipping into savings, so put all my extra money into overpaying the mortgage. Whereas DH is much better at hanging on to savings so he is focussing on building up a savings cushion

Be warned though, I can be terribly addictive!

I made great headway last year having previously been shocking with money. This year I've got further goals and I'm excited to get started. As an example, we are going on holiday in the summer which will cost 4K. Previously we would have technically had the money to do this but it would be beyond our reach as we had frittered so much away. I've already paid half off and know clearly how and when the other half will be paid.

Get in the habit of saving a set amount each month as soon as you get paid . Then you can spend whatever is left . You’re stuck in a rut of spending what you want and then trying to save what is left which is invariably not very much .
You need to change your mindset . Treat your savings like another bill . Good luck !

I'm the same OP but DP and I have debt to pay off and really want to start saving for a house deposit so that is my motivation starting this year. Just before Christmas I logged onto our online banking and totalled up what we had spent on different things eg eating out, takeaways, clothes etc. I couldn't believe the amount we had spent. We could have paid off most of our debt with that money. It was a big wake up call. I recently read a book called No Spend Year which the author did to the extreme but it really did show how much is bought because of want rather than need.

I budget, track spending, meal plan etc. I just have no control when it comes to spending disposable income. Rather than paying more towards debt, I'll get takeaways or clothes. If I have £10 in my pocket, I'll spend it.

Always think about your purchases overnight . Buy quality rather than quantity. Wait for sales or look for discount codes and cashback . Shop around for insurance etc deals . Buy the best food you can afford and buy less take away food . Better to eat well at home than eat rubbish when out and about .

If you have children it can be worthwhile buying good quality or desirable brands in the sales in a bigger size and then reselling when outgrown .

Set up a automatic direct debit of a fixed savings a.ouny from current accounts to a savings account.
Easier.
It goes straight out. Yiu dont see it or feel it.
Ask yourself before each whimsical or impulse purchase...do I already have this at home?
Am i bored or unhappy and spending for the sake of it and be cause I can.
Respect for money can be learned.
Use cash instead if a card. It makes it a real transaction in real time
Contact less is even worse as all those tiny transactions add up.
Get rid of Justeat or Deliveroo again because it's so easy.
Think about what and why you r spenfing on Amazon asos etc.
Its the thoughtless spending that sends all the best intentions off track.