Does spending less than you earn come naturally to you…or do reading those words raise a guilt-flag in the back of your head?

You may spend when you're bored, when you want to reward your efforts, when you're feeling depressed, when you have a new date or an important upcoming event…

when, when, when…

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For some people, every occasion is a legitimate opportunity to spend money. There may be remorse later when the bills come due and there's only $17.46 remaining in your bank account (5 days left before your next pay, no less). Or there may be no remorse at all but you have the sneaking suspicion that saving money for the future is something you should get around to.

(right after you check your credit report and before you settle in to shine up your baseboards).

If you're a “spender without a cause”, there are definitely some options to reign in your habit. You may think it odd at first, but many people give themselves physical restraints so that they will not use their debit/credit/cash.

You would be amazed at what people will not do because of one little extra obstacle.

A negative example of this: approximately 46% of Americans eligible to participate in their company’s 401(K) matching retirement plans do not participate due to the fact that they have to opt-in (which involves what amounts to a phone call and possibly a sit down with your HR person).

Physical restraints placed between you and your moolah might be just the thing to jump start your savings.

physical restraints

Physically Separate Yourself from Your Credit and Debit Cards

There are several ways you can physically separate yourself from your plastic. The first option is to put them into a plastic sealable bag, fill it with water, and put it in your freezer. You can also cut up your cards (but still keep the accounts open for credit history purposes or to continue to pay off debt), or you could open up a safety deposit box at the bank and put your cards in there.

Each of these methods gives you a cooling off period to really think about your purchase before you make it (figuratively, and literally, in the case of the ice block).

Purchase Penalty-Laced CD Savings

You likely have a few large expenses each year, such as property taxes, six month insurance bills (if you pay these all at once sometimes you save a few bucks), tuition, etc.

Do you ever get afraid you might spend the money before the bill is due, or that somehow it might just get absorbed in the no man's land between your checking and savings accounts? Purchase CDs in the amount of your planned, large expenses. Make sure they mature right before your bill is due. Not only will you earn a little bit of interest, but because there's a penalty to cash them out (not to mention you might have to travel to an actual brick-and-mortar bank) you're not as likely to touch that money.

Pay Too Much in Taxes

I would normally never recommend doing this, because when you pay too much in taxes, you are giving your money to the US government instead of it earning interest or otherwise working for you (you're welcome, Uncle Sam).

But we're talking about ways to physically restrain you from spending your money…and I can't think of a more effective method then involving the IRS.

Work with your HR professional to purposefully have them withhold more taxes than you should actually owe (typically you'll change your withholding on a W-4 tax form). It's pretty much forced savings. The trick here is that at the end of the year when you receive your tax refund, you need to immediately put this money into a savings account and forget about it—it’s not an extra lump sum that you can spend.

Use a Gift Card Allowance System

Have you seen those gift card kiosks popping up in everywhere from grocery stores to Home Depot? Pick yourself out several at stores you frequent (including the grocery store), and fund each with your budgeted money for that month.

You can either fund one gift card with all of the money for each of your categories of spending (such as a Visa or American Express gift card), or use one gift card per category, such as food, gas, and entertainment. When the gift card value is gone, so is the spending.

Note: this physical restraint might penalize you with an activation fee, so be prepared.

Put a Freeze on Your Credit

When you choose to freeze your credit, then each decision that is made to open up a new credit card or credit line, purchase a car, a home, etc. will entail a phone conversation to a representative at each of the three credit bureaus (Experian, TransUnion and Equifax). Talk about an inconvenience!

Un-link Your Credit Card Information to Online Stores

It is so much easier to just click “buy” online when you have your credit card information saved to your account and do not need to enter it all over again. By un-linking your credit cards and deleting the information, you are introducing one more physical barrier between you and whatever item you feel you need/want.

Do you use any sort of physical barriers to keep you from spending your money? I'd love to hear about them in the comments below (and you might help someone else out!). 

16 replies
  1. TK
    TK says:

    I have a question about the physical separation of cards. I’ve always had a credit card on me when I’m driving in case there is an emergency, which has happened before. If my card is in my freezer at home, what good is it doing me? I don’t think I can hand a business a piece of paper with my card number and expiration date.

    While I normally love your blog and have taken a lot of its advice to heart, I am disappointed to see yet another suggestion of giving the government an interest-free loan. Someone with an overspending problem would be better off dumping that money into an HSA or setting up an automatic savings transfer to be executed on the day that the paycheck clears. Getting an influx of money all of a sudden that seems “free” is a recipe for a splurge, not a heftier savings account.

    • Amanda L Grossman
      Amanda L Grossman says:

      Hello TK!

      Thanks for your comments (by the way–love your hiroshige gravatar!).

      The credit card in the freezer does you no good in emergency situations; but some people simply cannot help their spending habits. I honestly do not know what shopaholics do in emergency situations as they may have maxed out their credit limits and spent their savings anyway. They probably do not have funded emergency accounts either, so perhaps the plastic is useless to them.

      Also, the problem for some people is that they may never set up another bank account (and true, once they get their refund or interest-free loan that they gave to the government, they still need to physically put it into a saving account and not touch it).

      An HSA is an interesting idea.

      I’m glad you enjoy my blog!

      • TK
        TK says:

        Thank you for your response (and your kind words about my gravatar!). I’m always interested to learn more about how people save money.

  2. Melissa
    Melissa says:

    I like the CD idea for regularly, yearly bills. Also, I have put a credit freeze on our accounts, not to rein in our spending but because one of our accounts was compromised and I didn’t want to risk having that happen again. Since the freeze, I have not gotten one single credit card offer in the mail.

  3. Olivia
    Olivia says:

    Love your ideas.

    It must be hard to be a shopaholic. Really, no sarcasm here. I normally use cash for everyday and credit cards for already saved for bigger items.

    My mom’s best friend was plagued by bill collectors. I remember her pulling sherrif’s sale notices off her property before her kids got home from school. No way to live.

  4. Jenny
    Jenny says:

    “Each of these methods gives you a cooling off period to really think about your purchase before you make it (figuratively, and literally, in the case of the ice block).”

    Wouldn’t it actually be a ‘warming up’ period, in the case of the ice block? Lol.

  5. Kate @ Money Propeller
    Kate @ Money Propeller says:

    That picture was funny, I couldn’t imagine myself doing that! 🙂 I confess that I was a shopaholic before and I’m happy that I changed that habit, now I don’t usually buy things that are not really necessary.

    • Amanda
      Amanda says:

      I’m glad you like my pic!! Way to go on changing your habit. Do you feel like you’ve given up more than you’ve gained, or vice versa?

  6. Bill Dwight
    Bill Dwight says:

    Regarding the Gift Card Allowance system: a more flexible alternative would be to use a collection of reloadable prepaid cards. We offer a family pack of connected prepaid cards (for one low fee) originally designed for parents to deliver allowance to kids. But increasingly, we’re seeing parents allocate the cards and corresponding allowances to themselves – one for each high level discretionary spending category. It’s an e-friendly equivalent of the classic cash envelope system. Happy to give anyone a demo anytime – just tweet @FamZoo. -Bill

  7. Kenneth
    Kenneth says:

    I have had to use physical restraints for more than just overspending.
    For example, taking junk food out of the house (and not bringing any more in) to help with a diet and exercise program. Going to Gambler’s Anonymous for 2 years because I was gambling too much. Way too much. That was years ago, the urge has passes, and I don’t partake any more. And there were episodes of falling off the wagon in those two years. Also, closing stock trading accounts, because I realized I was not investing, but “gambling”.

    Fast forward to now.
    I have a $275,000 paid for home.
    I have no debt of any kind.
    I have $300,000 in index fund investments.
    My savings rate is 77 percent of take home pay.
    I lost 70 pounds from 275 to 205.
    Life is good.
    Put those restraints on!

    • Amanda
      Amanda says:

      Wow Kenneth! You’ve done a phenomenal job. Thank you so much for giving us a living example of this principle.

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  1. » Best Of Money Carnival says:

    […] L Grossman  takes a look at how compulsive spenders can reign in their spending with her post Physical Restraints to Help Shopaholics Stop Spending Money posted at Frugal Confessions – Frugal Living.  Sometimes if you know you  have a spending […]

  2. […] This article from the Frugal Confessions – Frugal Living. Provides some great examples of Physical Restraints to Help Shopaholics Stop Spending Money. I did not see leather straps or chains on the list. Am I even allowed to state that? If you […]

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