How to spend consciously and cut wasteful expenses

Despite trying to cut out unnecessary expenses, you find yourself struggling to stay within your budget. If that’s the case, then you haven’t been spending consciously.

What is conscious spending?

It’s about being aware and intentional with your money. Instead of just spending without thinking, you ask: ‘Is this worth it? Does it bring me value?’ It doesn’t mean you stop spending altogether - it means you spend smarter.

Here’s how you can spend consciously and cut unintentional expenses:

Step 1: Set your spending rules

If your money keeps slipping away, it’s time to set some boundaries.

1. Save first, spend later: Decide how much you’ll save every month before you even touch your money. Even if it’s just $50, this mindset shift changes everything.
2. Use cash or debit only: Withdraw your weekly budget in cash or set a spending cap on your debit card. No credit cards, no Buy Now Pay Later (BNPL). You spend what you actually have.
3. Create a ‘fun fund’: Set aside a small amount (say, $50/month) just for impulse buys. That way, you get to enjoy the occasional bubble tea or Steam sale guilt-free.
4. Track your daily spending: Apps or simple Google Sheets can help you track where your money’s going. Once you see it, it’s easier to stop wasteful habits.
5. Stick to a daily allowance: Want to take it up a notch? Give yourself a daily budget. For example, $10 per weekday for extras. Bring it out in cash, and when it’s gone, it’s gone.

Step 2: Cut out unnecessary expenses

Once you’ve locked in your rules, look for places to cut without pain.

1. Audit your subscriptions: If subscriptions eat up hundreds of dollars a month, it’s time to assess if you need all of them. Consider deleting under-utilised subscriptions or getting a family plan that could be cheaper on a per pax basis.
2. Eat out less, meal prep more: It’s not a secret that eating out costs a lot more than a simple meal prep. Meal prep on the weekends so you’re not tempted to eat out or order food delivery. If you must, limit the number of times you eat out, e.g., twice a week. When you do this, you might have to adjust your ‘Needs’ budget because now you have to buy groceries for meal prep.
3. Watch your daily treats: A $6 bubble tea here or $5 game skin there might not seem to amount to much, but unnecessary costs do add up quickly. If you have a $900 ‘Wants’ budget and you spend $6 a day on bubble tea, that’s $180 a month or 20% of your ‘Wants’ budget! You may want to weigh that against other items that give you greater pleasure.

You could stop at Step 2. But if you’re interested to get to the bottom of why you tend to overspend, continue with the following steps.

Step 3: Recognise your spending triggers

Spending triggers are situations, feelings, or external factors that make it more likely for you to overspend. These triggers can be:

• Emotional (like stress or boredom),
• Social (like peer pressure or FOMO), or
• Situational (like seeing a sale sign).

Here’s a list of common spending triggers:

1. FOMO (Fear Of Missing Out)- You have to participate in all social activities, such as brunches, concerts, staycays, because all your friends are going and you don’t want to be the loser who misses out.
2. Love of convenience You take frequent private hire car rides, order food delivery regularly, and eat out with your colleagues every day when you work in the CBD area
3. Inability to resist sales - Shopee flash sales? 11/11 mega sale? You just have to buy everything because if not during sales, then when?
4. Comparing yourself with your friends’ highlight reels - Since friend A bought this bag and looks super cool with it, you just have to buy this bag to feel like you fit in.
5. The ‘Buy Now Pay Later (BNPL)’ trend– pricier purchases appear affordable by spreading out payments over weeks or months, leading to more impulse buying.

Step 4: Manage your spending triggers

Once you’re honest with yourself and identify your spending triggers, you can do the following to manage them.

Cutting costs doesn’t mean not being able to live your life; it just means trimming what doesn’t add long-term value to you.