In a few short months, you’re probably going to give yourself a money-related New Year’s Resolution that will last all of about two or three weeks. It might be to save more money or spend less. It might be to start keeping a budget or invest more in the stock market. Whatever it is, the odds of you keeping your resolution past a few weeks is really small because that’s how resolutions are. Just because the calendar says January 1 doesn’t mean you’re a different person.
So, rather than just making a resolution, why not make it harder for you to do the things you want to avoid? Let’s talk about creating some financial roadblocks that will help you be more fiscally sound.
Freeze Credit Cards
Debt busters have used this technique for years. Take your credit card, wrap it in paper, and freeze it in a block of ice. If you want to spend it, you’ll have to wait until after the block of ice thaws before you can read the numbers (the paper is crucial, otherwise you might be able to read the numbers!). This will prevent you from making spontaneous spending decision, like buying something you saw on Amazon.com, as long as you don’t have your payment information presaved.
Don’t Save Payment Information
Amazon.com was very clever when they created their 1-Click purchase system. You could click one button and, since your payment information was saved in the system, could have a purchase happen with very little intervention. You can help curb some of your spending simply by deleting your payment information from an account. The next time you want to buy something, you may discover that your credit card is in the other room, maybe frozen in a block of ice, and you really don’t want that product as much as you want to keep sitting down! This has the added benefit of additional security. Since your data isn’t stored elsewhere, it can’t be stolen there either.
Lock Up Your Money
This tip is another dual-benefit roadblock. “Lock” up your funds by saving them in a bank CD (Certificate of deposit). A certificate of deposit is a type of deposit account where you can get a higher interest rate than a regular savings or checking account. The downside is that a CD will have a maturity period and you won’t be able to withdraw your funds from the account without a penalty. Generally a CD will charge you several months of interest if you want access to your money. That interest penalty will probably be enough to convince you not to take out your money.
Don’t Carry A Lot of Money
With your credit card frozen in a block of ice, the next step is to carry a little bit of money on your person. I’m always hesitant to advise this because of emergencies but if you carry around a debit card, it’s not too bad. By carrying only a little bit of money, you aren’t tempted to spend it because you’re carrying so little. It also means you have less money to spend, should you really really really want to buy something. If you do end up needing cash, you can always find an ATM. If you end up needing a lot, you can always rely on your debit card.
What did you think of these financial roadblocks? Are there any that you current use or a roadblock I haven’t mentioned?
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.