Restaurant trips, weekends away, day festivals and are all eating away at our current accounts – and most of us are feeling the pinch now restrictions have lifted.
Simply put, we’re overspending more than we should because we’re trying to make up for ‘lost time.’
After a year of being cooped up inside, we don’t want to experience any FOMO – so every invitation is a ‘yes,’ and we aren’t afraid to spend once we’re there.
Mentor Natalie Trice tells Metro.co.uk: ‘There is little surprise that as we come out of the cocoon of Covid, that so many people are feeling the need to return to how things were, and this includes splashing cash that, quite frankly, we might not all have.
‘It’s easy to get carried away with the expectations of others and live beyond your means for fear of looking like you can’t keep up and are letting the side down.’
Saying no to things isn’t enjoyable, but it’s vital when it comes to our finances.
So – despite being in various lockdowns for over a year – we need to ensure our bank accounts can handle our social plans.
If you’re feeling the pressure to spend right now – experts have shared some simple things to keep in mind.
If you can’t afford to do something, it’s important not to feel pressured to run up credit card bills just to save face.
True friends may be a bit disappointed but, ultimately, they will understand this.
Natalie adds: ‘Decide if you actually want to do that thing. If you do, can you find a way of making it work, and if you can’t either be honest and say you can’t afford it this month, or give a reason why you can’t make it – maybe catching up with family and friends, doing an extra shift at work or simply that you are too tired.
‘Yes, it might not go down well with everyone, but knowing that you have the money to live within your means is so much more empowering than trying to keep up with others – who maybe in a very different situation to you – and then getting into debt as they carry on with their lives none the wiser.’
Helen Forward, money expert at saving and investment platform Chip, adds that even though restrictions have lifted, there’s no need to go overboard.
She says: ‘Take it easy – you don’t have to be out every single night to make up for lost time. It’s not just about finances but also about re-adjusting emotionally and socially.
‘Not putting too much pressure on yourself will also help you take it easy on your bank balance.’
Set a budget for social events
Just how you might set a budget for monthly food shopping, you can apply this principle to social events.
Helen says: ‘Think about how many times you can afford to go out and how much can you afford to spend on a social occasion without it making too much of a dent in your finances.
‘Don’t feel bad about pushing back against plans that look like they might put a big hole in your finances.’
Also get more creative with social meet-up ideas that are less costly or even free – and don’t be afraid to push these.
Helen adds: ‘If your friends suggest something that you feel is too expensive, offer a more affordable alternative.
‘Swap a bottomless brunch for a picnic if the weather is nice. Instead of a cinema trip, suggest a visit to a free gallery or a museum. Suggest a walk and a coffee instead of lunch.’
Adjust your mindset
‘To be able to say “no” to spending, actually to anything in life, we have to see the benefits of the opposite situation’ says human behaviour expert Nevşah Karamehmet.
‘For example, if you want to say “no” to spending and you cannot, this means, you don’t see the benefits of saving yet – or you don’t see enough benefit right at that time.’
Nevşah suggests going as far as writing down at least 100 benefits of saving.
She adds: ‘That will create enough inspiration to stop spending and start saving. Of course, it is also very important to write down the benefits of saving and how these correspond with your values. We all live and get inspired by our values. If we can see something “valuable enough” we will be able to act upon it.
‘So ultimately, we need to see the benefits of saving enough to stop spending. I believe if people practice this exercise sincerely, they will stop spending immediately.’
Work out how much it costs you in work time
When we pay for things on our card, it often doesn’t feel like real money – one simple tap and it flies out of our account.
This is pretty concerning considering how hard we’ve worked to get that cash.
A good way to stay grounded with spending is to work out how much something will cost you in work time.
Sarah Neate, editor in chief at Ocean Finance, says: ‘It’s often harder to spend money when you think about how long it’s taken you to earn it. Think about your hourly rate.
‘Even if you’re salaried an annual figure, you should be able to work out a rough value by multiplying your weekly hours (e.g. 35 hours) by 47 weeks to get the total number of hours worked per year (assuming you’re entitled to five weeks of annual leave), then dividing your annual salary by that number.
‘When you find yourself overspending, ask yourself a question before purchasing something. “Is this £10 cocktail worth the 45 minutes I had to work to purchase it?” or “is this mid-week pick-me-up takeaway worth working a full hour?”’
Move money out of your current account
If you’re finding it difficult to reign in your spending at social events, there’s one practical method that might help.
Helen says: ‘If you find it difficult to control your spending, or to stick with your saving habits (or both), move money out of your current account – out of sight, out of mind. An easy trick is to pay yourself first and save money on payday.
‘Move an amount of your choosing into a separate savings account as soon as you get paid and before you get caught up in the excitement of your pay hitting your account.’
The idea is that you’ll think twice before dipping into your savings to retrieve more cash.
Have at least one ‘no spend day’ per week
Having a dedicated day of limited or zero spending will make you feel more in control of your finances, and will also help with willpower.
Sarah says: ‘Try allocating at least one day per week to a “no spend day.” These days, you should be cautious about spending on “wants” – which is anything you would like to have but do not need to have.
‘For example, a takeaway coffee to help energise yourself on the way to work, or lunch from your local café as you forgot to make a packed lunch for work. It could even be a spontaneous purchase when your favourite shop hosts a sale.
‘Refraining from making “want” purchases on at least one day per week will help curb impulsive buying, while establishing a more positive attitude to money – as you realise you can have still fun without the need to spend.’