I Was a Chronic Overspender: The No. 1 Trick That Got Me To Stop
It started when I was 29 years old, when I got a job that paid me 30% more than the job I had prior. At work, we got free breakfast, lunch and dinner everyday through individual Seamless accounts. Sometimes I’d pop in on the weekends, when I was off, just to get free takeout. Who wouldn’t?
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I wasn’t swimming in wealth, but I was a young woman with no kids making great money and dedicated to living a big life in a big city (NYC). I had already been living below my means at my previous job that paid so much less. I lived in the same rent-controlled apartment I’d been burrowed in for seven years. I had two roommates. I cooked all my meals. I practiced frugal living in general.
When I got this new high-paying job, and one that, at the time, I expected to lead to even higher paying roles soon as my manager told me it would, I felt I could shed some of my frugal habits. Life was grand — until I spiraled into a “shop ’til you drop” mode. And folks, I would never drop.
I Saved Some Money, but Spent Just as Much of It on Nonessentials
Monthly, I put a chunk of my income away in a savings account. I sent another small portion of it to my mom, whose sole income is Social Security. Some I used for nights out with friends. The rest? I spent. And I spent it almost exclusively on clothes and shoes. I was primarily hooked on eBay and ThredUp, both sites where you can get gently used or even new-with-tags apparel for crazy low prices.
I Stubbornly Steered Clear of Investing
Though I never fell into credit card debt or spent so much that I couldn’t put money aside for savings, the thought to invest any of my cushy new income beyond the pennies I put in my 401(k) seldom occurred to me, and when it did, I immediately shut it down. Though I’m now an experienced financial journalist, I wasn’t one back then, and I nurtured the common (and dead wrong) assumption that I didn’t have enough money to invest. Yes, I had at least $200 a month to throw at dresses and boots, but nothing to invest. That was my thinking. If I’d ever stopped to really reflect on this, I’d hopefully realize how absurd my thinking was. But I never stopped to reflect. Guess I was too busy shopping online.
The Stuff I Bought Did Not Stand the Test of Time and Created Waste
It wasn’t uncommon for me to order at least one heavily discounted item a week.
I felt I’d become an embarrassment at my place of work. (I had most of my packages sent there to evade the porch theives lurking around our apartment). I always donned gorgeous and yet-to-be-seen-on-me garments, but for what? To impress the same group of techies at my job who rarely looked up from their computers? To dazzle the weary city crowds as I galivanted to the subway like a knockoff Carrie Bradshaw?
It was ridiculous and so terribly wasteful. Sometimes pieces lost my interest right away and I’d go sell them at consignment stores for a fraction of what I’d spent on them. A couple times these pieces were new with tags, unworn.
Getting To the Roots of My Chronic Overspending
I loved the challenging hunt for a deal. Looking for an Anthropologie sweater that once cost $280 on the rack but now costs $32 on eBay? On it. How about a pair of very specific vintage Frye boots that could go for hundreds, but that I’ll find in my size online for $45? Done.
The thrill of finding deals on so many things I coveted (and then bragging about my finds to anyone bored enough to listen) was a big part of why I spent so much, but there was more to the problem.
My mom and I didn’t have much money when I was growing up. When I was about 12 and at a new school, I started being made fun of for wearing stuff my mom got me on sale at JC Penney. No disrespect to JC Penney, but in 1997, during the height of grunge and skater fashions, its florals-friendly juniors’ section was not exactly aligned with what a middle schooler writing a novel inspired by Radiohead’s lead singer wanted.
I clung to the knowing that once I was a grownup, I would wear what I wanted to and I would be able to do so without worry, because by then I’d be making my own money. And now, here I was, a grownup making my own money and doing whatever the heck I wanted with it.
My Aha Moment
Though I wasn’t heading for financial disaster on a grand scale, I was getting in the way of my best financial interests by squandering cash I could have been investing. That really haunts me now, more than a decade later.
Another humiliating confession: I didn’t keep a budget. I mean, I wasn’t totally out of the loop; I knew my basic expenses every month and always put money aside (in a traditional savings account that rendered hardly any interest), but I didn’t keep track of my nonessential spending whatsoever.
When tax season came, I went to the accountant I’d been seeing for years. Another writer recommended him to me, exclaiming, “He will get you write-offs on everything!” The accountant, who worked out of disheveled closet of an office and was always taking hostile phone calls, told me to look through my bank statements and find all work-related expenses. I was still doing some work on the side as a self-employed writer and editor and was eager to get deductions.
So, I went through the previous year’s bank statements and … holy cow. I was in over my head by just how many times the words eBay, ThredUp and Etsy appeared on them. It was at once apparent that this little shopping habit of mine was not so little and that though I felt like I was feeding some childish void in my soul by doing it, I was actually just obscuring the void by burying it in stuff.
The Trick That Ended My Overspending Is Super Simple
I wish I could say that right after that brutal tax season wherein I tallied up the thousands I’d spent on nonessential stuff, I promptly got my financial act together. But that’s not what happened. I went on spending and spending and it wasn’t until I got engaged and began planning a wedding with my now-husband, that I made a vow to stop.
But the vow wasn’t enough. I needed to actually do something. So, I made the very simple move of crafting a budget that included $75 a month for nonessential items. I launched the budget on the first of the month and felt confident. LOL! Within a week, I’d spent $90 on a dress and a pair of pants. Clearly even a vow paired with a reasonable boundary wasn’t enough to stop me.
I elevated my budgeting game. I started writing down every single thing I spent money on that wasn’t essential. A bagel on Saturday? Documented. A martini with my bestie? Captured. A new $15 blouse previously priced at $180? I wrote it down in a notebook I carried in my $200 bag that cost me $15.
Every night, I tallied up any money I spent that I absolutely did not need to spend. Seeing the damage in garbled black ink between sharp blue lines made me gasp. I’d managed to blow $210 in five days. Forty-two bucks a day. Squandered.
On day six of writing down every little or big thing I bought, it all finally hit home. I was a chronic overspender and it was a real problem. I’m glad to know that groups like Spenders Anonymous exist, and maybe I would have benefitted from attending its meetings, but I managed to stop overspending without intervention.
The trick wasn’t deprivation (I still set aside money to splurge on my silly bargain finds each month), but it’s now within extreme reason. Sometimes I get incredibly tempted to spend more “just this one time,” and I did sort of relapse during the recent holiday sales, but I’m back on track now. This past week, in my nonessentials spending diary, there were no entries and I intend to write in this notebook less and less as the months of this still tenderly young year go on. I may always be a bargain hunting consumer at heart, but I’ve finally found the way to give my wallet (and my two closets) a rest so I can focus on building wealth.
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This article originally appeared on GOBankingRates.com: I Was a Chronic Overspender: The No. 1 Trick That Got Me To Stop
