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How to Reshape Your Money Mindset

Geoff Williams

If you often find yourself s pending money on products and services you don't really need and making poor financial decisions, now is the time to set realistic goals and take action. Maybe you often make impulse purchases. Perhaps you often spend more than you can afford. Or maybe you lack a well-rounded financial plan that's prevented you from spending, saving or investing strategically. Regardless of your past money-management patterns, if you want to regain control of your finances and reframe your attitude toward spending, you can change your outlook and break bad habits by adopting a few smart strategies.

Here are four easy ways to reshape your money mindset:

-- Identify your bad habits.

-- Analyze your spending patterns.

-- Use technology to your advantage.

-- Reflect on your poor spending patterns.

[See: 10 Foolproof Ways to Reach Your Money Goals.]

Identify your bad habits. If you recognize that you're always running out of money or can't seem to save enough, Amit Chopra, a certified financial planner and managing partner at Forefront Wealth Planning and Asset Management in Suffern, New York, suggests removing online marketplace apps from your phone. He especially recommends deleting Amazon's app, which he calls the "Amazon Triangle." "It's just like the Bermuda triangle except your money disappears," he says. "Amazon makes making impulse purchases easier than ever before, and it can become a bottomless pit of spending." By eliminating the Amazon app from your phone or iPad, you can break bad financial habits. "This has an immediate impact," he says.

That said, he doesn't suggest avoiding visiting Amazon altogether. With Amazon's automated service, you can buy things that you always use, "such as body wash, diapers and dog food," which can help you with budgeting and save you time.

That may help in other ways, too, according to Chopra. "Having to run to the store for something tends to lead to other impulse purchases. You can use Amazon to combat the very impulse purchases it was causing to begin with," he says.

Ultimately, you want to look at where your money is going and what you're doing to contribute to your spending habits -- and try to change your behavior. If you're an emotional spender, you could eliminate your tendency to make impulse purchases by adopting the tried-and-true strategy of waiting a day before buying an item and reassessing if you want the item after 24 hours.

"This helps remove your emotional state from the decision-making process, and you'll often find that after the 24-hour period, you don't actually want what you almost bought before," says Brian Ford, an Atlanta-based financial executive at SunTrust.

[See: 10 Ways to Save More in 2019.]

Analyze your spending patterns. If you do end up making a purchase after 24 hours, Ford suggests writing it down. Note everything you're spending money on and, at the minimum, pour through your bank and credit card statements to look at where your money is going, he advises. "When you go back and see what you've spent, you'll likely find places where you can make cuts -- and save money," he says.

Even better, look back at the last six months of your statements, suggests Byron Ellis, a certified financial planner with United Capital Financial Advisers, and founder of Doing Money Right, a financial coaching blog based in The Woodlands, Texas.

Ellis suggests looking for any recurring unnecessary expenses you can cut. "Also list out any expenses that seem high that you might be able to reduce. How much do you really use your Netflix, Hulu or Amazon Prime memberships? Be critical of where your money is going," he says.

Use technology to your advantage. If you don't have the personality to clip coupons or look for ways to save money, Ellis points out that there are a lot of apps that can do that work for you. "Ebates, Ibotta and Shopkick are all great rebate apps that help you save money or earn rewards on shopping you would do anyway," he says. With these apps, you can receive cash back when you shop online. "Honey is also a useful browser plugin that scours the web for online coupons, then applies it to your shopping cart," Ellis adds.

Reflect on your poor spending patterns. Aside from assessing the money habits you want to break, ask a trusted family member or friend for candid feedback about your attitude toward your finances. And if you need additional help, consider turning to a financial coach or therapist.

Amanda Ponzar, communications executive with Community Health Charities, a nonprofit that raises awareness and financial resources for health and well-being that's based in Alexandria, Virginia, suggests asking yourself: "Why did I buy this? Did I need it? Can I afford it, and was it in the budget?"

"I realized I used to buy cheap things because I grew up in a family where money was tight, and my parents were big savers and faithful givers, so we couldn't afford nice things," Ponzar says. She says that if the family ever went out to a fast-food restaurant, they never went without a coupon.

"Saving is good, but it can't just be about coupons and the lowest price," Ponzar says, adding that she used to buy the lowest-priced coat on sale for a rock-bottom price -- but she would later realize that she didn't like the purchase and was unhappy wearing it. So, she was wasting money, even if it had been a seemingly attractive deal.

[See: 11 Expenses Destroying Your Budget.]

Once Ponzar identified this wasteful spending pattern, she was able to focus on buying services and products that are not only reasonably priced, but also of good quality. And now, she says, "if I do eat out at a restaurant, I don't just eat what we have a coupon for, unless I like it."



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