The One Day Never to Open Your Wallet and Other Money Rules
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But, what about those visits that are more spontaneous? When a friend drags you to her favorite outlet or an afternoon stroll ends in a new neighborhood boutique, you'll find a master wish list might save you from yourself.
"I keep a shopping list on my smartphone," says Lauren Lyons Cole, a certified financial planner. A few times a year, she goes through cupboards and closets from attic to garage and notes what she needs. "I'm only allowed to buy the stuff that's on my list."
Although a small notepad and pen would do the job, a smartphone means access to apps such as Google Shopper, which not only can store your master list, but also can scan barcodes for price comparisons, reviews and more.
Think of a master list as the ever-present instructions for scavenger hunting items you most covet to be found at the very best price.
Her solution: "Challenge yourself to be more mindful and conscious of what kind of return on joy you're getting from every dollar you spend."
This requires not only writing down how much money they cost you, but how much joy they brought you. Highlight only those items in your notebook (or smartphone), and then take a look at what's not highlighted. That's where you start thinking about making conscious, mindful adjustments to your spending, Thakor says. In other words, that's where you should start cutting back.
Start with your monthly income and subtract your bills, retirement funds, children's college-fund or other saving-plan contributions. Divide this amount by 5. Put one-fifth in a separate account for annual spending (holiday gifts, weekend getaways, etc.) The remaining four-fifths are your pocket money for the month—think of each portion as your weekly allowance.
"When it's gone, it's gone," Lyons Cole says.
By taking money off the table at the start, you're setting yourself up for success no matter what distractions or urges crop up along the way.
Next: 6 money mistakes to avoid