How to Gain Control Over Spending (4 of 4)

We are not quite finished discussing the non-necessary purchases.

Yesterday, we talked about Ego and Tradition Purchases, and we have one left.

7. Guilt Purchases. This category is similar to tradition purchases, but the irrational motive here is guilt. Gifts given to meet other's expectations are guilt gifts. In the past columns I have challenged you to take control of your finances by tracking how you spend your money. That means keeping a simple written record, day in and day out, of how you spend your money. Recorded on something like an index card (one card per day), a Daily Spending Record shows you exactly where your money goes. It requires two entries for each purchase: "What?" and "How much?" Now you need to add a third entry: "Category".Of the seven purchase categories, the first two (Need Purchases and Investment Purchases) are almost always winners. The second two (Pleasure and Convenience) are neither winners nor losers, while the last three (Tradition, Ego and Guilt) are the debt-makers. Take a few minutes to have a heart-to-heart talk with yourself.

Think about the purchases you've made in the past that had a negative impact on your financial health. Funny isn't it, how the purchases we regret the most are higher in the purchase category chain?

As you begin to see your purchasing by category something wonderful will happen. You'll change the way you spend your money, making it possible to take back control of your life!