Experts Share How You Can Save $600 a Month With Loud Budgeting: What It Is and How to Pocket Cash
Plus, learn how to say no to unnecessary spending and learn what slow shopping is
Loud budgeting is the latest viral social media trend that people are claiming has helped them save a lot of money. But what is loud budgeting? We have an expert to break down what it is, how much it saves and how to get started.
You’re not the only one whose curiosity has been piqued by “loud budgeting” since it started trending on social media. Research from ClarifyCapital.com shows that online searches for this term spiked by an astonishing 765% in a single month in the US alone!
So, what is this new savings technique? “Loud budgeting is about turning down requests from others to spend money on activities or make purchases that don’t fit within your budget’s goals,” says Shaywanna Harris-Pierre, PhD, Licensed Professional Counselor and Certified Financial Therapist Level I.
What is loud budgeting?
“What makes it ‘loud’ is that people are clearly and directly sharing that they’re saying ‘no’ because they’re putting their financial goals first,” Harris-Pierre explains. This means no more making up excuses about why you can’t splurge, such as not being available the day of an event. Instead, it’s about being honest and open about wanting to meet your money goals.
“One example of loud budgeting,” Harris-Pierre offers, “would be rejecting an invitation to an outing with friends by saying something like, ‘I’d love to come to brunch today, but it’s not in my budget this month’. Another example: ‘I wish I could celebrate with you, but I can’t join your birthday trip this year. I have financial goals that are preventing me from spending that much money on travel right now. But I hope you enjoy yourself and want to celebrate with you when you return.’”
How much loud budgeting saves
People who’ve embraced loud budgeting have been saving $629 on average every month, the same research shows. That’s a whopping $7,548 a year you can put toward paying down bills or fattening your piggy bank! “Loud budgeting helps you save money because you’re prioritizing your financial future over feeling obligated to spend money on activities or events that aren’t vitally important to you,” she says. “Also, saying what your money goals are out loud and setting clear boundaries around how you spend your money helps you hold yourself accountable to meeting your financial goals.”
Getting started on loud budgeting
“To become a loud budgeter, first make your financial priorities clear to yourself by writing a list of what your values are (for example, it may be important to you to regularly spend time with friends) and how your spending habits align with those values (for instance, you may prefer hanging out with pals at home rather than at expensive restaurants). Then, create a budget based on your income, values and money goals. This way, when friends offer you invitations (for example, to dine out), you’ll know right away if it’s something you want to do or decline. And if you decline, you can let them know it’s because it doesn’t align with your financial goals and priorities.”
Trouble saying ‘no’?
If you find it difficult to speak up and tell others when you don’t want to spend money, reflect on what creates this discomfort, urges Harris-Pierre. “When we want to say ‘no’ to others about financially draining obligations, we can often feel guilty, ashamed or afraid of causing conflict. When these emotions arise, name them, acknowledge their validity and extend yourself grace around how those emotions have influenced your ability to set firm boundaries in the past. This way, you can approach setting financial boundaries differently in the present and future.”
What is slow shopping?
We now know what loud budgeting is, but what is slow shopping?
Picture this: You’re in a store or browsing online for a certain item, when another product catches your eye. It’s not on your shopping list and you don’t need it, but it would look fantastic in your kitchen. Many shoppers would put it in their cart right away. But people using the “slow shopping” strategy wait before deciding whether to buy it. That’s because this method lets you pause and consider a purchase carefully, says Julie Guntrip, Head of Financial Wellness at Jenius Bank (JeniusBank.com).
“This extra time could be a few minutes, 24 hours or even longer, depending on the situation,” she says. “It’ll help you evaluate why you want something. Odds are, when you revisit it with fresh eyes, you’ll be less likely to buy it.”
While retailers work hard to prevent you from having too much time to think—it’s why they use a variety of strategies to prompt quick decisions, such as low-inventory alert and limited-time sales—you can thwart these high-pressure tactics and use slow shopping to keep more cash in your wallet. Just keep reading to learn how!
When you want a product or service that’s not on your shopping list, create an easy way to delay your decision. One option: Set an alarm for 24 to 48 hours, suggests Guntrip. Or give yourself a place to temporarily hold products while you consider them, like an online wish list (WishList.com). A study from Texas Tech University reveals that shoppers who delayed buying online products by adding them to a wish list were 42 percent less likely to purchase them.
The researchers found that when you come across a new product, you first focus on the flashy, fun aspects of it. But when you put it back down and come back to it, you’ve cooled off, allowing you to focus on whether it fits your everyday needs. If it doesn’t, you often decide not to get it, without feeling deprived.
While slow shopping is a savvy way to resist small impulse buys, it’s just as impactful for expensive purchases because it gives you time to compare features. “For me personally, car shopping is a great opportunity to practice slow spending,” says Guntrip. “Experiencing the new car smell and playing with the gadgets make me fall in love a little too quickly.” To guard against getting caught up in the moment, she doesn’t allow herself to buy the car the same day she shops. “I walk away and consider all the information. This ensures I evaluate multiple cars and price points.”
Slow shopping doesn’t mean depriving yourself. In fact, splurging every now and then makes it easier to stick to a budget, says Guntrip. “If you enjoy occasional shopping sprees that amount to around $500, for example, consider keeping a little more than that in your ‘splurge fund’ to cover those expenses and provide a buffer.” This way, you’ll avoid going overboard while still enjoying life’s little pleasures.
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