How come eating more makes us fat but spending more makes our wallets thin? That doesn’t seem very fair now, does it?
So should we tackle budgets like we do diets? Should we even bother at all? A recent article in Time Magazine broke down some pretty interesting research. Let’s get nerdy and dive into the stats.
Here’s Five Fast Facts on budgets and diets:
- 😝 Vibe Check - Back in 2018, researchers at the University of Minnesota found that people view budgeting as unpleasant, which makes them less likely to keep them going. In their study, participants tracked their shopping over Black Friday weekend and found they enjoyed spending less when they were on a budget. They also found that the feelings were stronger the less money participants had.
- 🔄 Hamster Wheel - U of M researchers also discovered that budgeting had both positive and negative effects on spending. When participants spent more than they budgeted, they typically evened things out by spending less the following week. However, when they spent less, splurges were more likely in the week that followed. Talk about a vicious cycle.
- 🪀 Yankin’ My Yo-Yo - These same restrict-and-binge cycles are super-similar to what we see in dieting. Just as experts have found that dieting doesn’t necessarily lead to long term health, budgeting doesn’t always lead to less money stress. In a 2016 study by the Financial Consumer Agency of Canada, only 8% of participants said that budgeting reduced their financial stress. Additionally, only 13% said they felt more in control of their money.
- 🫣 My Own Worst Enemy - While budgeting may work for some people, the restrictive, controlling mindset can give us the ick. When we judge ourselves and self-monitor, experts say we might be less empowered to live life more intuitively and use money to support our goals and desires.
- 🧘 Savings Swami - So what’s the cure? One way to revamp your money mindset is through “conscious spending,” or being more mindful of your money moves. In other words, be present and active in your choices that involve money and put your inner wisdom to good use. Journaling, sitting quietly or meditating, and daily check-ins with your feelings towards money all count.
🔥Bottom line: Conscious spending might sound a little woo-woo, but don’t knock it til you try it! Who knows, this might just be the year where your personal finances get as ripped and lean as Richard Simmons in his prime. Want a clean recipe for a tight credit score? Bop on over to this article.
Are you ditching your budget this year?
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