Sometimes the smallest of changes will get us exactly where we need to go. Author, James Clear says that “If you get one percent better each day for one year, you’ll end up thirty-seven times better by the time you’re done.” On the opposite end, if you get 1% worse each day, you’ll be headed into pretty rocky territory. Here’s where micro habits come in. If we challenge ourselves to stick to the smallest of habits every day then eventually the results from the habits will all pay off. I’ve pulled together a few micro money habits that will help you grow your finances over time. Most of these are habits that I’ve been using for years or just started using to tighten up my finances. Let’s get into it why don’t we?
LIFESTYLE
- Double-think purchases and consider if you are spending just to spend money or if you are spending because you truly love that item or experience. For example: Is your coffee shop habit a truly joyful moment or is it just habitual?
- Meal prep a few or all of your meals during the week to save money on takeout
- When shopping around for service vendors, compare three cost options before settling on one to ensure you’re getting the best price
- Instead of committing to a gym that you go to, some of the time, consider an option like Classpass that allows you to try multiple gyms and workout classes throughout the month
- Think twice about expensive everyday “luxuries” that add up, I’m talking $5 kombuchas at the grocery store, $150 nails every two weeks or weekly Doordash orders. Those things really add up over time and may be putting a dent in your wallet that might hold you back from reaching your financial goals
SHOPPING
- When shopping for anything online, go through a “cash back” site for every purchase – My favorite is Rakuten
- Reduce impulse purchases by saving an item that you like to a “wishlist”. You might find that after you get through the initial moment of wanting the item you don’t really want it anymore. I know I’m guilty of this!
- When purchasing clothes, think of the “cost per wear”. This is the amount of money “per wear” that it will cost to own an item. A great pair of jeans might have a cost per wear of pennies vs. a sparkly ball gown that you’ll wear one time. The calculation is: (COST OF ITEM/APPRX # OF TIMES TO BE WORN)
- Speaking of! Consider renting one-time-use outfits vs. buying them. I love Nuuly and Rent the Runway for these one-time “stunner” pieces. I only purchase one-time wear outfits if I’m obsessed with them. Even then I try to find another opportunity to wear them again. This is also a great option for vacation outfits that may not fit into your everyday wardrobe.
MANAGING MONEY
- Set up recurring plans for saving, investing, etc. so that you know for sure that the money will be saved consistently. Need a savings account? Check out Ally Bank with my personal referral link.
- If you haven’t started saving or investing, try saving 1% of your income each month
- Create mini “sinking funds” for expenses that occur every six months, annually, etc. (Birthdays, Christmas gifts, Car Taxes/Insurance, Medical Expenses, etc.)
- Check your bank and credit card accounts daily
- Opt-in to text alerts for daily account balances, deposits, negative balances, etc.
- Make sure you can pay for an item with your cash reserves before swiping your credit card
- Review your expenses regularly for errors, opportunities to save, etc.
- Cancel underutilized or useless subscriptions
- Opt out of checking and savings accounts that charge you a fee to do business
- Review your credit card benefits to ensure that you are maxing out what is available to you. For example: Some credit cards offer free phone insurance so you may not need to pay for that through your phone company
- Pay bills by the due date or a few days earlier to avoid late fees
- Check-in on your entire financial picture regularly, this can be weekly, quarterly, or annually but check-in to ensure that you are tracking toward your goals
OTHER
- Have a “no-spend” day, week, or month to occasionally practice money discipline
- When getting your car serviced, always do a quick Google search to find a coupon for the service fee. You can usually find at least a 10% discount somewhere. A dollar saved is a dollar earned!
- Make a plan for “unexpected money”, I have the rule to save at least 50%, use 23% toward a financeial goal, and use the remaining 25% however I see fit
- Try a “one-in, one-out” rule where with every new thing you bring into your home, you take one thing out. Either sell or donate that item to reduce clutter around your home
- Intentionally use credit card rewards for purchases that you would feel good about like a trip to a place that you’ve been wanting to go or a new pair of shoes
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