Are you wondering how to curb your spending without sacrificing your happiness? Well, you are not alone. When it comes to 2022 goals for the average consumer, it turns out that managing their money better is at the top of their list. The need to spend better and smarter stems from the realisation that 65 percent of people had no idea how much they spent in the previous month. Additionally, as more people take on side hustles and alternative sources of making money outside of the traditional employment box, they are also looking to spend smarter and save more without overhauling their lifestyles. Why not try a spending plan?
Put Away For Retirement Sooner Not Later
One of the main stressors for many families is the overwhelming realisation that they may not be as prepared as they thought for life after retiring. With the cost of living inching up, inflation surpassing predictions, and retirement savings down, it is more important than ever to start your retirement planning earlier. In fact, 1 in 6 of those 55 and older have no pension savings according to a study by Unbiased.co.uk. A general rule of thumb is to aim to put away 10 to 15 percent of your income. Alternative tax-friendly saving tools like the Lifetime Individual Savings Account (ISAs) are a good place to put those savings. You can also boost those savings with one-off raises like choosing to redirect your unused vacation funds to your retirement savings or adding your annual bonus to your ISA contributions.
Spend On Experiences Not Things
Stress and impulse spending is up. Around 61 percent say they are spending more online during the pandemic. Termed ‘comfort spending’, it can be easy to be tempted by the endless shopping adverts popping up on our social media feed. Yet, the satisfaction it can bring is often short-lived. On the other hand, research has shown that investing in experiences provides more happiness than material possessions. So when choosing when to spend on wants, ensure it is something that is not only within your budget but also that can provide sustained benefits like long-term memories.
Help Your Budget And Happiness By Making It A Treat
Science has shown that purchases and experiences tend to bring more joy as treats. Splurging more unnecessarily and regularly not only hurts your bank balance and budgeting abilities but can also reduce the happiness you feel when consuming it. Instead, opt for moderation and take a break from your favourite takeaway or shopping excursions. Limiting yourself to one takeaway per month instead of weekly can save you a significant amount and give you something to look forward to.
The balance between spending smarter and enjoying life to its fullest can become tricky at times. Remember that it is a continuous adjustment and your approach will change as you go through life. What is certain, however, is the power a good budgeting technique and dedication to savvy spending can have in creating a happier future.
