4 Simple Steps to Break Bad Spending Habits and Achieve Financial Freedom

We all have those guilty pleasures – a quick online shopping spree, an impulsive trip to Target, or treating ourselves to a dinner out when we know we shouldn't. It's easy to let these little habits slip by, but when they add up, they can become the very thing standing between us and our financial goals. If you're tired of falling into the same spending traps, you're not alone. But here's the good news: breaking those habits doesn't require willpower alone – it’s all about changing your environment and implementing a system that works for YOU.

In this post, we're diving into proven strategies based on James Clear’s Atomic Habits to break those bad spending habits and help you take control of your finances. I’ll break it down step by step and provide actionable tips you can start implementing today.

1. Why Your Spending Habits Aren’t About Willpower – They’re About Systems We often hear about people who have “great self-control,” but the reality is, the most successful people in financial matters are the ones who don’t rely on willpower alone. Instead, they create systems that make it easier to make the right decisions.

James Clear, in his best-selling book Atomic Habits, explains how our habits are the result of our environment and cues, not just sheer willpower. This is great news for you! Instead of trying to fight your urge to splurge, we can shift your environment and the way you approach money to make it easier to make good financial choices.

Think of this as setting yourself up for success without having to constantly rely on your willpower. The key is making your bad spending habits harder to access and making the good choices more appealing and easier to follow through with.

2. Make Your Spending Habits Invisible Have you ever tried to break a bad habit and been tempted by the same old triggers? Maybe you always get sucked into an online shopping spree when you check your email or find yourself browsing the clothing section at the mall. The solution? Make those habits invisible.

James Clear emphasizes the power of the “out of sight, out of mind” principle. When you’re constantly exposed to the thing you’re trying to avoid, it’s nearly impossible to resist. For example, if you know that you tend to overspend when you walk into Target, make it harder to get there in the first place. Find alternate stores to shop or, even better, stick to online shopping where you don’t have the impulse-driven environment of physical stores.

Here’s an example of how to apply this to your own life:

• Delete shopping apps: If you tend to make impulse purchases on Amazon, eBay, or any other platform, consider deleting the apps from your phone. The fewer steps it takes to impulse-buy, the more likely you’ll fall into those habits.

• Remove subscriptions: Do you have a monthly subscription to a service that encourages unnecessary purchases, like Amazon Prime? Consider pausing or canceling your subscription to remove that temptation.

3. Make Your Spending Habits Unattractive Our habits are largely driven by the rewards we expect to receive. If you feel a quick rush when you splurge on something, that’s the reward that’s reinforcing the habit. But you can flip this around. To break a bad spending habit, make it unattractive.

One simple way to make spending less appealing is to use cash instead of cards. Studies show that when you use a credit or debit card, the transaction feels less real, which can encourage overspending. By paying with physical cash, you can make the act of spending more tangible and painful.

Here’s a fun exercise to help you feel the impact of your spending:

• Withdraw cash for the week: Go to the ATM and take out a set amount of cash for your weekly expenses. Only use that cash for non-essential purchases. This way, you’ll feel the weight of your spending every time you make a purchase, which can help you make more mindful decisions.

4. Make Your Spending Habits Difficult Another strategy from Atomic Habits is to make bad habits difficult to engage in. If you know that you tend to impulsively buy things when you’re scrolling through social media or checking your favorite stores, take action to make those purchases harder to make.

For example, if you’re prone to online shopping binges, take your credit card information out of the autofill option in your browser. Or, if you always seem to add extra items to your cart while scrolling, consider disabling one-click purchasing options.

Here’s a quick fix:

• Set up barriers: Add additional steps to your purchase process. This could mean requiring a password for every online purchase, even if you’ve previously saved your information, or using a shopping app that forces you to wait 24 hours before making any purchase. Giving yourself time to reconsider can often make the impulsive decision feel less appealing.

5. Make Your Spending Habits Unsatisfying Bad habits are easy to keep up with because they often provide immediate gratification. For example, buying something new gives you an instant rush, even though the long-term consequences (like increased debt) may be harmful. To break a bad habit, you need to tie it to something that’s unsatisfying in the moment.

One great way to make spending habits unsatisfying is by introducing an accountability system. It could be as simple as having a friend or family member keep track of your spending and hold you accountable.

For instance, if you buy something without checking your bank account, make a promise to return it. Even if you can afford it, going through the process of returning an item you didn’t need can serve as a powerful reminder to make better choices in the future.

Here’s a quick action step:

• Create a habit contract: Write down your financial goals and habits you want to break. Share this contract with a friend or family member who can hold you accountable. You’ll feel more pressure to follow through when someone else is watching, and the pain of failing will feel more real.

6. Create Systems, Not Just Goals When it comes to your financial future, goals are important, but systems are what will actually get you there. It’s easy to say you want to save more, cut back on spending, or stick to a budget, but without a system in place, you’re setting yourself up for failure.

By using these strategies, you’ll create a financial system that works for you, not against you. Break your bad spending habits by making them harder to engage in, less satisfying, and more visible in terms of their consequences. Set yourself up for success by eliminating temptation and building new, healthy financial habits that support your long-term goals.

Breaking bad spending habits doesn’t have to be a battle of willpower – it’s all about creating systems that work for your life. By making your bad habits invisible, unattractive, difficult, and unsatisfying, you can gradually build a healthier relationship with money and start making progress toward your financial goals. Start small, be consistent, and before you know it, you’ll be in a much better position to take control of your finances and build a brighter future for yourself.

Are you ready to start taking control of your finances and breaking those spending habits? Grab my free Mama’s Budgeting ebook, packed with practical tips for creating a budget that works for YOU and your family. Let’s take this journey together!

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