Anyone who has ever come into a significant amount of money from a win quickly knows how challenging it can be to stay in control of spending habits, even when you feel as though you currently have the luxury of buying whatever you want.
Of course, excessively generous spending habits can leave your business and savings account in a much worse position than necessary, while also stunting expansion and reducing cash flow. Self-control is the name of the game, but beyond that there are several specific tips you can use to keep your spending habits reasonable after a sudden increase in funds:
1. Pretend Like You Don’t Have It
While it might seem like a silly suggestion, this classic trick is an effective way to keep yourself from dipping into your savings unnecessarily. You’d be surprised what people can manage to get by with when they pretend like they’re broke, so this is a good preliminary psychological trick to implement before you incorporate the methods below into your frugality efforts. Theoretically, if you were able to survive and enjoy yourself prior to making the money, then you should be able to continue doing so without a problem.
2. Open a Savings Account
Opening a savings account that isn’t linked to a physical debit card is a great way to keep your money out of reach. Even if you already have a general savings account, opening a separate account specifically for your new nest egg may help you further segregate your finances to keep yourself from spending recently received funds. This “receive but don’t spend” mindset is the key to keeping your account growing instead of declining.
3. Set a Predefined Budget
Budgeting is perhaps the best way to ensure that you’ll be meeting all of your needs and leaving yourself a reasonable amount for leisure and luxury without going overboard. When you know exactly what you’re allowed to spend, you won’t be tempted by impulse purchases because you’ll have all your spending money allocated to specific items or activities ahead of time.
4. Invest in Assets that are Easy to Liquidate
If you absolutely can’t resist the urge to spend money now that you’ve just received a bunch of it, ideally, you’ll want to spend it on things that can be easily sold and turned back into cash in the near future. Buying things that will depreciate in value or are difficult to resell is the equivalent to flushing your hard-earned funds down the drain.
5. Discipline is the Bottom Line
Ultimately, all the fancy tricks in the world can’t serve as a substitute for sheer discipline. You can put the money in a savings account, create a budget, and even pretend like you threw it in the ocean, but when the urge to spend comes lurking, the only thing that really keeps you from dipping into the pot will be your own resolve and restraint. If you won your funds by betting/playing the lottery, self-restraint is extra important. Thankfully, the majority of websites now have deposit limits which can be seen through lottoz.co.uk whose system stops you from depositing more money than you want to. Taking advantage of these deposit limits is highly recommended when betting your money as it prevents you from losing too much.
If you approach frugality with that in mind, you’ll be in a better position to successfully prevent yourself from dwindling your newly acquired wealth via overzealous spending.