Wednesday, February 22, 2023


Chapter 9 | Watching What You Spend

What Freezing Really Means

Freezing means going cold turkey on your spending—you temporarily stop buying.

You freeze your spending for a predetermined amount of time—usually six to twelve months—and just stop shopping. Of course, you can still buy groceries and the required supplies for your home, but you don’t buy anything else.

Establishing What’s Really a Need

Understanding the difference between a need and a want is really the crux of sorting out your financial difficulties.

In an effort to make ourselves feel better about being consumers, we continually elevate wants to the level of needs. But we actually have few needs, at least in the realm of products that you can buy:
Food and water

Humans need a way to stay warm and dry, but they do not need ten suits or eight pairs of jeans.

And while everyone needs food and water to survive, that food does not have to come from a five-star restaurant. You also only need enough calories to survive, not enough to add three to five pounds each year,

Identifying the Consequences of Not Meeting a Need 

After you’ve listed all your needs, identify what would happen to you if you didn’t get each one, asking yourself the following questions: 

Would you or others around you die?
Would you or others suffer physical pain or extreme physical discomfort?
Would your health or the health of others suffer in the long term? 
Do you know for sure that you would lose your job without this item?

If none of these would happen, it isn’t a need, it’s a want, and you have no business buying it during a spending freeze. Remember this the next time your mind tries to talk your wallet into giving in.

Establishing—and Sticking to—a Shopping List for Your Needs

Before you leave the house and head out to spend money, write out a shopping list of your needs (which are likely to include only groceries and toiletries). Be sure that they’re needs, and don’t pad the list because you’re in the mood to buy. Keep in mind that you are probably feeling deprived, so you may try to satisfy your spending itch by splurging on groceries and toiletries.

Don’t justify veering from the list because something is “such a good deal.” Instead, remember that the best possible deal is to spend $0, so even if an item is half price, you can’t buy it unless it’s on your list.

Put Away Your Credit Cards

For six months, pay for all of your day-to-day purchases with cash and pay your bills with a check.

Tuck Away Your Debit Card

If you take $80 in cash to the grocery store, you’ll be very careful not to exceed that amount with convenience foods. But if you take a debit card, you’re not likely to be nearly as careful. Put the debit card in the same place you put the credit cards—your best bet is in a safe-deposit box.

When you feel the itch to spend, go online or look at a friend’s catalogs and write down the item number, description, page number, and so on, of any item that looks interesting. Act as if you’re really going to buy the item. But don’t. Just add the item to your list and let the list sit for a while. The act of writing the item down will feel, strangely enough, very similar to how you feel when you actually buy something. It sounds completely crazy, but it works!

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