What is mindful spending and how to do it

Many of us spend money without giving it much thought, which can lead to financial stress and prevent us from reaching our goals. Mindful spending offers a solution.

Mindful spending is all about being intentional with your purchases. And making sure they align with your values and goals. This guide will show you how to practise mindful spending and take control of your finances.

What is mindful spending?

Mindful spending means being intentional with your money. It’s about thinking carefully before making a purchase and spending only when you have decided that it’s the right choice.

In practice, mindful spending involves:

• Understanding your spending habits.
• Knowing what you spend money on.
• Understanding how your purchases make you feel.

The aim is to spend your money in a way that aligns with your values and long-term goals. You could think of mindful spending as the opposite of impulse spending:

Impulse spending

Impulse spending is when you buy things that you hadn’t planned or budgeted for. It could be small like grabbing a snack at the checkout or bigger like buying a TV unplanned just because it’s on sale.

Examples of impulse spending include:

• Clothes purchased because of advertising, but not really needed.
• Tech bought because it seems like a ‘good deal’ on sale.
• Snacks that weren’t on your shopping list.

Some people enjoy shopping as ‘retail therapy’, finding excitement or happiness from impulse buys. However, the excitement often doesn’t last long, and can leave behind feelings of regret or unfulfillment. 

That’s where mindful spending could help.

How can mindful spending help me?

Taking time to fully consider a purchase before making it has multiple benefits. Here are some:

• Save money - By cutting down on impulse buys, you’ll likely save money over time. 
• Understand your needs vs wants - Mindful spending helps you distinguish between spending on needs (essentials like food and rent) and wants (extras like eating out or entertainment). It’s okay to spend on wants if you’ve thought about the impact on your budget and made sure your essentials are covered.
• Reduce financial stress – Mindful spending can reduce stress by encouraging thoughtful buying decisions. You may be less likely to make impulse buys and more likely to prioritise purchases that are aligned with your long-term goals. This could make you feel in control over your money, which may lead to less financial stress.
• Align spending with your values - If sustainability or supporting local businesses is important to you, mindful spending lets you research and make choices that reflect these values. This can lead to feelings of fulfilment.
• Reach your goals - By saving money through mindful spending, you can put this money towards what’s important to you and your long-term goals. For example, this could be saving for a holiday, building an emergency fund, paying off debt, or donating to a charity you care about.

6 tips to help you practise mindful spending  

Here are six easy tips to help you stick to mindful spending:

1. Track your spending:  Start by tracking all your spending. This helps you see where your money is going and identify where to make changes. Look at your bank statements, use a spreadsheet or try budgeting apps.
2. Understand your spending triggers:  Learn what prompts you to spend money on non-essentials. By tracking where and when you spend, you might notice patterns, like often buying things on your phone, through social media, or at certain shops or times of the day. Understanding your triggers can help you avoid them in the future.
3. Wait before buying:  Pause before making any non-essential purchase. Waiting gives you time to think about if you really need it. Try waiting 24 hours, a week, or even a month before deciding to buy.
4. Add friction: Make it harder to spend in the moment. Remove saved card details from online shops, avoid taking credit cards out with you, or set yourself a no-spend day once a week.
5. Remove temptations: Try to stay away from your triggers and shopping temptations. For example, unsubscribe from promotional newsletters or emails, avoid window shopping and limit browsing online shops for fun.
6. Set up a budget: Create a clear plan for your money, based on your own financial situation, goals, and values. Before purchasing something, think about how it would impact the rest of your budget. Read our guide on how to make a budget and stick to it for help getting started.

Questions to ask yourself before making a purchase

Before buying something, you could pause and ask yourself these questions:

☐Do I really need this?

☐Does buying this align with my goals and values?

☐Will this give me long-term value or happiness?

☐Can I borrow this item or buy it second hand? 

☐Am I only buying this because it's on sale?

☐Is this something I've wanted for a long time?

☐What else could I do with this money? 

Still want to buy?

If you’ve considered these questions and still believe the purchase is worthwhile, that’s okay. Mindful spending isn’t about restricting yourself; it’s about making choices that align with your priorities. As long as you’ve covered your essentials, it’s okay to use some money for fun.

Key takeaways

Spending mindfully is all about being present and understanding your own behaviour. Use our tips to help you get started.  And remember, control over your spending is achievable!

Take some time to identify areas where you can make positive changes. And by practising mindful spending, you can take charge of your finances, align your spending to your priorities and work towards your long-term goals.