Many people struggle with saving money, especially when the cost of living continues to be high. Impulse buying can cause many people to fritter away their cash, making it difficult to save money.
Whether you’re looking to save money for a deposit on a house, have big plans for the future, or want to build an emergency fund, the 30 day rule could help.
This article explores a saving strategy aimed at curbing impulse spending, ultimately assisting you in constructing a more secure financial future.
How does the 30 day rule work?
The 30 day rule is simple. When you feel the urge to spend money on a ‘want’ you have to put the amount you’d spend on it into a savings account. Then you wait 30 days. At the end of this period, if you still want to buy the item, you can. If you don’t want to anymore, you should leave the money in the account.
The idea is that you take the emotion out of the purchase, and give yourself the time to consider if you really want to take the leap and purchase the item. Often, when people impulse buy, they are searching for the initial dopamine hit that comes when you purchase something new. When you take this factor out of a transaction, you decide whether you actually want the item for its function, rather than the feel-good hormone hit.
What constitutes a ‘want’?
A ‘want’ is very different from a ‘need’. ‘Needs’ are essential things that you need to survive. This includes food, water, shelter and clothing. Your gas and electricity bills are a need, as is buying a new pair of shoes when your old ones have worn through.
‘Wants’ are items that don’t fall into this category. You may want to buy a new pair of shoes, but if you already have many pairs that are in perfect condition, you don’t need to buy more. Food is essential, but buying a takeaway every week is a ‘want’.
There’s nothing wrong with wanting extra luxuries. However, many people end up spending lots of money on them, making it impossible to save and sometimes putting themselves into debt.
Knowing the difference between ‘wants’ and ‘needs’ is essential when it comes to the 30 day rule. This helps you distinguish what items you should apply the rule to.
How to succeed with the 30 day rule
There’s a few steps you can take to make the 30 day rule a little easier to manage.
Firstly, set up a dedicated savings account. You’ll need an easy-access account if you want to be able to withdraw the money after the 30 days. Shop around for an account with a good interest rate, this way, you’ll end up gaining some interest on your money, helping to grow your savings overtime.
You should also set up a separate fund for ‘little wants’. This means that you have a set amount each month for spending on non-essential items. You need to factor this into your budget, to make sure you can afford it. This means that you don’t have to go completely ‘cold-turkey’ with spending, making it easier to adjust to the 30 day rule.
Finally, it’s important to be patient. You won’t build up your savings overnight, but with time and patience, your finances will strengthen. It can take a long time to build a new habit, so make sure that you remain committed to the plan. Being realistic with your expectations will help you understand the long-term benefits of the 30 day rule.
Summary
The 30 day rule is a practical and useful measure that anyone can use in their daily spending.
If you are a person who struggles with impulse buying, this strategy can help you slow down your approach to shopping. It takes out the emotional element of buying something new, and helps you rationalise your purchase.
Understanding the difference between ‘wants’ and ‘needs’ will help you understand what you should be spending your money on. ‘Needs’ are essential and you should always prioritise these purchases over any ‘wants’.
To discover success with the 30 day rule, you need to set up a dedicated savings account. Try and find a savings account with a high interest rate so that you can maximise your money. If you can fit it into your budget, set aside money for ‘little wants’ every month in a separate spending fund. This means you have a dedicated amount to spend on things you want each month.
Remember, patience and dedication is the key to succeeding with the 30 day rule. It will take some time, but if you remain consistent you will see your savings grow.
