Suze Orman: Use This Simple Hack To Spend Less
If you've ever walked out of Target having spent $200 on a cat-shaped vase and bathroom wall art that says “Please Seat Yourself,” when you went in for dish soap, Suze Orman sees you. But don’t worry, sweeties, she has a fix so simple you won’t be able to dismiss it.
In a recent blog post of hers, the legendary personal finance expert points to a Wells Fargo survey finding that more than 90% of adults want to be more intentional and thoughtful about their spending. If you are wondering where to get started, Orman offers a single two-second tool that actually makes that possible.
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Suze Orman's Hack: Ask Yourself ‘Is This a Need or a Want?’
That’s the whole kit and kaboodle and if you do it every time, you’ll start to see the results add up. "Every time you are about to buy something, whether it be $10 or $1,000, stop and ask yourself: Is this a need or a want? Every time, do you hear me?" Orman said.
The power isn't in the question itself, but rather in the pause the question creates. Most overspending is set to impulsive autopilot. Taking just a moment to truly analyze if you need something interrupts that self-automated spending before you swipe your credit card.
What To Do If It's a Want
If you're serious about reining in your spending, Orman’s advice is to skip the want entirely or at least set boundaries.
“If you are really serious about reining in your spending, my advice is to forego spending on wants. Or build in guardrails: I will spend only $X a week on wants. Either way, by stopping and identifying a potential purchase as a ‘want,’ you are elevating it as a potential source of saving. Either by forgoing the purchase entirely or opting for a less expensive option,” she explained.
What To Do If It's a Need
Orman insisted that even genuine needs have spending flexibility baked in.
“Even with needs, you might be able to reduce your spending. The less expensive brand — whether it be food or clothing — meets your needs and can save you money. And it’s even more in play for huge expenses, such as buying a car or a home (or the place you decide to rent). A car to get to work is a need. As is shelter. But what you choose to spend on both is up to you. Asking yourself if you might be able to fulfill the need and spend 10%, 15% or 20% less can transform your finances,” Orman said.
Why Orman’s Hack Works When More Complicated Systems Don't
Just by taking a beat before your next purchase, whether it’s that coffee, book, piece of clothing or online cart checkout, simply stop and ask the question. It takes two seconds. The answer might surprise you and over time, so will your bank balance
Most budgeting methods require spreadsheets, apps, weekly reviews and category limits, leading to most people abandoning them by week three. The need vs. want question takes exactly two seconds before you buy something, which is exactly when it matters most. Or as Orman said: "[It's] guaranteed to help you pay more attention to how and when you choose to spend money.”
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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