Apply the $100 Rule to Kill Impulse Purchases
As I’m planning on going to Japan in august again, I see a high need to cut down on my spending. But the thing is it’s always hard to save up money in the last moment or not to buy that 1 little thing you saw in the window.
I read on Lifehacker how you can save money by dividing the price of the item by 100 and then rethinking it that many days. Ofcourse in my case I would have to divide it by a much smaller number like 25 or 50 as I have a maximum of about 15 euros a day to spend on bullshit if I want to go to Japan.
Here is the base principal from the original article on the No Credit financial blog.
I like stuff – gadgets, gizmos, and thingamajigs. I also like saving money. So, I’ve created the $100-A-Day-Rule.
For every $100 that I want to spend on the purchase of a new product, I must wait one day before I make the purchase. This creates a self-imposed ‘cooling-off’ period.
If a new gadget costs $100, I have to wait one day until I can purchase the gadget.
If a new gizmo costs $400, I have to wait four days until I can purchase the gizmo.
If a new thingamajig costs $1400, I have to wait two weeks until I can purchase the thingamajig.
I tend to live ‘in-the-moment’, which is just a fancy way to say, I like to impulse buy. In the past, when I wanted something, I just went out and bought it. And, in the past, I’d be stuck with payments, long after the desire for the product had gone away. I once purchased a video game console – because a good buddy had one – and I don’t even like video games. I used my credit card, bought the console, played a few games of Madden, and then never touched it again. A $250 gaming console sat, unused, in my entertainment center, for three years.
Now, when I want something, I use the $100-A-Day-Rule. I spend time researching, looking for cheaper alternatives, and deciding if I really want the item.
No Credit Needed Blog