How to stop spending money

Spending is part of everyday life, but it can become problematic if it outpaces your income (especially if you're trying to save money or clear debts). If you regularly buy things you don’t need or spend more than you earn, you may need to learn how to stop spending money.

In this article, we’ll discuss some key strategies to help you stop spending money unnecessarily. Whether you’re trying to save money on a tight budget or targeting a specific savings goal, these tips may help you to achieve your financial objectives.

The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.

Before you can curb your spending, you’ll need to track your existing monthly expenditure. Review your outgoings for 30 days to determine where your money is going and how much you’re spending. This will help you identify areas where you can cut back on your spending and establish how much money, if any, you have left over before payday. Online banking and banking apps provide an easy way to monitor your outgoings and that all-important bank balance.

Once you understand your income and outgoings, you can set a monthly or weekly budget. Drawing up a budget helps plan what you can afford to spend during the month, which is essential if you want to avoid getting into debt. Be sure to review your budget regularly to check whether your spending is within your set limits.

A budget planner doesn’t have to be complex - you can even use our free budget planner to guide you. There are also various apps available to help you track spending and manage your budget.

If you’re frequently going over budget, you may need to rethink your priorities. Prioritise essential spending, such as your mortgage or rent, household bills, food, clothing and transport costs. After that, you’ll need to think carefully about what matters most to you and make your spending decisions accordingly. You’ll most likely need to make some sacrifices but the benefits will be worthwhile. For example, skipping a £15 weekly takeaway could save you £780 over the year.

It’s also important to approach spending with a realistic mindset. Most people would love an exotic holiday or top-of-the-range car, but your ideal lifestyle should not be allowed to dictate your finances. Instead, focus on how to have the best lifestyle you can within your existing budget. That’s not to say you can’t enjoy a few luxuries occasionally – you just have to accept that you’ll need to be patient and save.

If you want to stop spending money on unnecessary things, you need to understand the triggers that cause you to spend in the first place. Are you more tempted to impulse buy when you feel upset or anxious? Perhaps you’ve made a habit of popping into the coffee shop on your walk to work. Or do you spend more when you’re with certain people? Identifying and removing these triggers, whether psychological or emotional, can reduce your spending.

Setting clear, quantifiable goals can help you stay motivated and maintain discipline. Whether you’re saving for a wedding, a deposit for a house or a new car, ring-fencing your money for a specific purpose may make you less likely to spend it on non-essential purchases. You could even put a list or photo in your purse or wallet as a reminder of why you’re changing your spending habits.

Even if you don’t have a specific objective in mind, setting some simple short-term financial goals can help you stay focused. Short-term goals could include “I want to reduce my food spending by £50 a month” or “I want to save 10% of my monthly salary”. Whatever goals you choose, make sure they’re attainable and keep a reminder at hand.

Whenever you’re tempted to spend, work out the true cost of your potential purchase. You can do this by calculating how many working hours it would take you to earn enough money to pay for that item. For example, if your purchase costs £160 and you earn £10 per hour, that’s 16 hours of work. That ‘must-have’ item can seem less appealing when you calculate its true value to you.

If you’ve set a specific savings goal (see above), consider how much longer it might take you to reach this goal if you were to cave in and make that purchase. For instance, if you’re saving for a baby, the £300 watch you have your sights on could pay for a cot. This change of perspective can deter you from spending money you might later regret.

If you’re tempted to make a big purchase, give yourself at least three days to think about it. Take the time to consider your potential purchase and ask yourself some key questions: Do I really need it? Will I use it? Can I afford it? And can I find it cheaper elsewhere?

If, after the three-day waiting period, you still want the product (and you can afford it), then go ahead and buy it. However, once the rush of impulse shopping has worn off, you might decide you no longer need the item. Although it can be challenging, imposing a mandatory waiting time is a great way to spend less money and prevent those budget-busting impulse buys.

Spending on credit cards can easily snowball, often resulting in expensive interest payments and debts. Leaving a credit or store card at home can help you avoid the temptation completely.

If you’re a keen online shopper, deleting your card details from online shopping sites may have the same effect (as saving your payment details can make impulse spending easier).

With no credit or debit cards to fall back on, you’ll only be able to spend as much as you physically have in your purse or wallet. This may help prevent those unplanned purchases that can push you over budget every month.

Food might be a necessity, but it’s easy to overspend on groceries and meals. Planning meals and preparing a shopping list may make you less likely to buy unnecessary items. Food shopping when you’re hungry may increase the temptation to make impulse buys as well.

Swapping expensive coffee-shop drinks for homemade alternatives and taking a packed lunch to work rather than stopping at the local sandwich shop may help reduce your spending too. It might involve a little planning, but your bank balance will thank you for it.

Avoiding unnecessary trips to the shops may help reduce unplanned spending.

You can also remove the temptation to spend by unsubscribing from retailers’ emails and catalogues. If you don’t see their latest product offering, you can’t be lured into buying it.

Regularly reviewing all of your subscriptions can help identify memberships you rarely use. You can usually cancel them by logging into your online account or contacting your service provider. You could also cancel the direct debit with your bank directly. Find out more about cancelling recurring payments here.

If you’re looking to buy something for a one-off event or short-term use, consider whether you can borrow the item instead. Whether it’s a fancy-dress costume or a hedge trimmer for the front garden, it’s worth asking family, friends and neighbours if they would be willing to lend it to you. Or why not see if there’s a Library of Things in your area? You can often find a whole range of useful household items available to rent for a small fee.

If you really need to buy something new, you could sell something you already have to cover the cost. Not only will this minimise the chances of overspending, but it will also help you to keep on top of household clutter.

Classic tips are often some of the best, and collecting loose change is no exception. At the end of the week, empty your purse or wallet and throw any spare change into a designated jar. While the odd 50p here or there might not seem much, it’s surprising how quickly it mounts up over the year. You could even label the jar as a reminder of your savings goal, for example, 'new car' or 'honeymoon'.

Paying someone to wash the car, mow the lawn or clean the windows? If so, then it might be time to knuckle down and get your hands dirty. Tackling some of these tasks yourself may help reduce your monthly expenditure.

If you’re looking to break your spending cycle, try taking on a no-spend challenge. A no-spend challenge refers to a set period of time when you stop spending money on unnecessary things. As part of the challenge, you’re only allowed to spend money on essential, budgeted-for expenses such as your rent or mortgage, bills or food shopping.

Whether it’s for one or two days a week or a whole month, taking a self-imposed spending hiatus is a great way to break old habits and kickstart your new approach to money.

Hopefully this guide has given you a few ideas on how to spend less money. Now you’ve mastered the art of mindful spending, it’s important to put all that effort to good use. If, after implementing these strategies you find you have some spare cash, put it towards clearing any credit card debts, bank loans and overdrafts.

You can then start thinking about building your savings pot or increasing your pension contributions. Through Raisin UK, you can explore a range of competitive savings accounts from our UK partner banks. It's free to register for a Raisin UK Account, which lets you manage your accounts in one place. 

Changing your spending habits takes time, but small, steady steps can lead to lasting results. Stay consistent, and you’ll be better placed to reach your financial goals.