Cultivating mindfulness is all the rage right now – and for good reason. Learning to be more aware of your thoughts and actions is a crucial step towards a healthier, happier and more focused mindset.
But the topic is usually discussed in terms of spirituality and emotional awareness, ignoring the more practical applications it can provide. Developing mindfulness in your everyday activities is just as important, and nowhere is that more apparent than with money. Financial mindfulness will lower your anxiety, focus your approach and save you money.
So how can someone develop that mindfulness? Read on for tips on how to make your mind and money one.
Track Your Expenses Manually
Instead of glossing over your bank statements at the end of the month, try tracking your purchases manually as you make them. Write down what you spend by hand while you’re making the transaction.
Using Mint.com’s services can also help you track your expenses. You can set up alerts in Mint so you know when you’re over budget, instead of spending with no clue on how much you’ve racked up. Mint can also help you know when your checking account is low or when you’ve had too many ATM fees – helping you save money.
Awareness starts in realizing what you’re spending money on and how much you’re spending. By getting in the habit of tracking your expenses, you’ll become more aware of your purchases and what they mean for your overall financial health.
Set a 24-Hour Waiting Period
It’s so easy to buy something without considering if you really need it, especially in the age of Paypal where all it takes is the click of a mouse. To stop yourself from spending in a vacuum, set a waiting period for items above a certain price point.
If you’re not sure whether you really need something, wait 24 hours (or longer). If you’re still thinking about it after the waiting period, give yourself permission to buy it. The more expensive the item is, the longer the waiting period should be.
Realize What the Trade-Offs Are
It’s easy to spend money if you’re not aware of what you’re giving up in turn. For example, spending $100 on eating out might not seem like a big deal, but $100 a month could go toward paying down debt, starting a retirement fund or saving for a trip to Cuba.
Make a list of what your dreams are and compare that to what you spend money on. If the two lists show some cognitive dissonance, you might want to reconsider how you’re using your finances. For example, while you may personally value travel, your spending habits could indicate that going out with your coworkers for happy hour is actually your biggest priority.
Take Stock of What You Have
If you have a habit of spending money aimlessly, take an afternoon to do an inventory of what you own.
If you love to buy clothes, go through your closet and dresser. You might be surprised at what you haven’t worn in a while and how many new outfits you could make. If you’re a bookworm, go through your collection to see what you haven’t read. If you’re a gamer, go through your cabinet or hard drive and take a look at all the titles you haven’t played in years.
Reminding yourself of what you have can curb the craving for more stuff, and that’s really the essence of mindfulness – being aware of not only your actions, but the motivations behind them and the factors that could change your decision.
Zina Kumok is a freelance writer specializing in personal finance. A former reporter, she has covered murder trials, the Final Four and everything in between. She has been featured in Lifehacker, DailyWorth and Time. Read about how she paid off $28,000 worth of student loans in three years at Debt Free After Three.