Cutting back is one way to save money, but you know what’s better? Opting out.
That is because cutting back is a slippery slope, it does require a lot of discipline. Opting out completely is a cold-turkey method. There is no grey area. And you just have to do it. And it could be for small or big savings. For example, you could opt out of eating out. Totally and completely! Or opt out of purchasing a home with all its costs and maintenance.
So how do you go about it? It is easy. Detect an area of spending that you can live without and slash it. For example, no more lunches out. Pack yourself lunch to take to work or have ready snacks, so you don’t have to buy lunch. Tough but doable.
Similarly, if you find that you’ve been spending a lot on weekend getaways, cancel this category. Find local activities that don’t break the bank, and stick to this plan for as along as it takes to achieve financial goals.
But that is not everything that you could do. Opting out works best when you identify a relatively large situation that typically drains a lot of money. For example, if you opt out of summer vacations, you might be able to save thousands of dirhams. If you opt out of shopping during end-of-year sales, regardless to how tempting, you may turn this period to a time to recover financially instead of draining more of your resources.
Easier said than done, right? True, but you can master the skill of opting out by following these steps.
Know your priorities
A lot of spending is driven by temptation, impulse or lack of discipline. Take a look at your recent credit card or bank statements, and pinpoints items that you could have lived without. If you see a pattern of spending that fits that category, that is where you need to start.
For example, have you settled in a habit of shopping online for clothes, electronics or furniture. Now is the time to opt out. Just end it. Don’t shop online anymore unless you absolutely need something or have to replace an essential item. Doing so will help you kick off the habit and save.
Marketers do a great job in being in front of you all the time. If you search an item online, you get targeted and retargeted online with advertisements that are in line with your search. Although you might initially resist the temptation, just seeing these ads repeatedly may create a fake sense of need.
So be ready to remove these temptations. Ignore ads and unsubscribe from emails, if you can. If not, create a separate email address to use for daily communication with family, friends and work that you don’t use for online accounts. Gmail already split your emails to primary, social and promotion. So use a similar system to protect yourself for overexposure to advertising.
Simply don’t participate
How others spend their money is no indication of financial health. You may be struggling to keep up with friends in terms of going out, dining out and travelling, and thinking that is because of your income. You might find that they also struggle but both of you and they are in this situation together. Don’t hesitate to opt out. You actually may be doing them a favour.
Think of is a better way of living. If you begin a diet, you might be sharing the news of your progress with others and encouraging them to follow suit. How about you be the pioneer in opting out of activities that drain your budget every month. Share the good news with others, and they might be grateful to being able to save.
Rania Oteify, a former Gulf News Business Features Editor, is a Seattle-based editor.
How to opt out
Detect and slash spending categories
Skip activities that don’t matter
Prioritise to know what doesn’t matter