How would you like to control impulse shopping with one simple money saving trick? What is the 30 day rule and can it really help you save money?
Imagine, controlling your spending while shopping online or in-store. As a result, you start saving money and break the living paycheck-to-paycheck cycle.
Luckily for you, I’m going to show you exactly how the 30 day rule can break your overspending. What will you do with all your extra money?
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What is the 30 day rule for saving money?
The 30 day rule for saving money is a method for controlling your spending. When shopping, take note of items you would impulse buy and reevaluate 30 days later. After 30 days, purchase the item if you still feel inclined to purchase.
For example, I’m walking through Target and see a cute baby outfit that I must have. Rather than purchasing, I’ll make a note of the item on my phone with the date and location.
Now, I have 30 days to consider purchasing the baby outfit. After 30 days, I’ll purchase the item if it’s still something I want. Otherwise, I’ll ignore it and move on with my life.
Click to Tweet! Please Share!Click To TweetWhat makes the 30 day rule so effective?
The 30 day rule is effective because it reduces your impulse shopping. Too often, we see something we like and decide to purchase it on the spot.
It’s not your fault too. Shopping can produce a chemical reaction in our brains, releasing dopamine. Dopamine is a “feel good” chemical, making shopping a pleasant experience.
Basically, the 30 day rule allows you to “sleep on it,” so you aren’t making important decisions in the moment. Sleeping on it has been scientifically proven to reduce buyer’s remorse.
Buyer’s remorse is when you purchase something and then regret it the next day. People often experience buyers remorse after major purchases, like a house. Home purchases are such a financial commitment that people lay awake at night wondering if they made a good financial choice.
The 30 day rule is also effective for controlling clutter around your house. If you’re purchasing less then you’re bringing home less “stuff” to fill your home.
It’s really easy to live paycheck to paycheck when we purchase items without budgeting. Setting up a proper budget will help you control spending while saving for important financial goals, like retirement.
What is the 50 20 30 budget rule? Is it better than the 30 day rule?
The 50/20/30 rule is the solution that will help your finances with doing minimal work. The basic premise is that up to 50% of your income goes to the essentials, minimum of 20% goes to savings, and up to 30% goes towards personal spending.
Up to 50% of your income goes to the essentials that you need to survive. This money is for paying bills and setting aside money for emergencies. This money is not for luxuries such as gym membership, eating out, entertainment purposes, etc.
A minimum of 20% should go towards investing, paying off debt, or saving for the big costly items. For example, you might have 10% savings towards your 401k and 10% towards paying off debt.
The remainder of your income goes towards personal spending. This money is for entertainment, eating out, hanging out with friends, and gym memberships. You can spend this money however you would like.
Click to Tweet! Please Share!Click To TweetSo is the 50/20/30 budget better than the 30 day rule?
Not necessarily, but the 50/20/30 budget rule provides a structured system for your money. It doesn’t matter if you do the 50/20/30 budget or 30 day rule, but you need a budget for your money.
With the 50/20/30 budget, you are planning where your money goes. You ensure the essentials are covered with the 50 percent and your savings goals are met by saving 20 percent. The 30 percent allows you to have your impulse spending within reason.
The 50/20/30 budget can help you budget if you are low income because it forces you to save. However, keep in mind the percentages are only guidelines and can be adjusted to your situation.
How much of my salary should I save?
As I mentioned, the percentages of the 50/20/30 budget rule are adjustable for your situation. However, you’ll never break the paycheck to paycheck cycle if you aren’t saving money.
Therefore, I highly recommend keeping the 20 percent savings, but understand if you need to adjust.
Keep your retirement age in mind and ask yourself, will you have enough money at retirement? You can use a retirement calculator once you know how much money you want in retirement.
Per the Dave Ramsey baby steps, he recommends investing 15 percent of your pre-tax income into your 401k. However, investing 15 percent of your pre-tax dollars can be a huge hassle for a lot of people.
While I think 401k investing is important, I also think you should take advantage of low-cost exchange trade fund investing. Personally, I have my 401k and I have a maximum amount that I keep in my checking or savings account. Anything over the maximum amount is invested into ETFs.
Click to Tweet! Please Share!Click To TweetSummary: 30 day rule for saving money
The 30 day rule allows you to save money by controlling impulse shopping. The idea is that you wait 30 days before purchasing an item that would be considered an impulse buy.
Effectively, you’ll reduce spending on purchases you didn’t really need or want. If you are really wanting to purchase an item, you’ll want to purchase it 30 days from now. Otherwise, you were probably experiencing a shopping high or living in the moment.
While you can sleep on it, budgeting is a far better way to control your spending and meet financial goals. The 50/20/30 budget helps most people living paycheck to paycheck have spending freedom while actually saving money.
Budgeting with the 50/20/30 allows up to 50% of your income goes to the essentials, minimum of 20% goes to savings, and up to 30% goes towards personal spending. However, not everyone can meet these exact percentages, so modify them to your needs.
For example, someone with a low income may need to live on 70/20/10 budget percentages.
TightFist Finance
John is the founder of TightFist Finance and an expert in the field of personal finance. John has studied personal finance for over 10 years and has used his knowledge to pay down debt, grow his investment portfolio, and launch a financial based business. He is committed to sharing content related to personal finance based on his experience in his career, investing, and path towards reaching financial independence.
