How and Why You Should Change Your Mindset About Money

I used to be someone who questioned how people could have enough income to afford things like a day at a spa, travel, investment portfolios, nice clothes, retirement savings, or weekly meal service. But now, I’m one of those people! I’m still working on the traveling often part, but I’m getting there! None of this is because of a pay increase. Here’s what happened.

I revisited my priorities and changed my mindset on money.

Money priorities:

A new survey by Student Loan Hero reveals that 83% of Americans (up 7% from last year’s survey) wished they’d handled their money differently.

With the way I spent my money, you’d think my priorities were:

1. Living expenses
2. Take out / fast food
   • I often forgot to bring lunch or was too lazy to make dinner
3. Entertainment
   • I went to brunch, dinner, happy hour, and did other activities with friends and my boyfriend
4. Self-indulgence
   • Whenever I had a bad day, I’d walk around the mall and buy something small like one-time use beauty products or cute decor
5. Groceries
   • Since I knew I spent a lot on the categories listed above, I tried to save money with this category. But it ended with me getting tired of the food I made, eating out, and wasting the leftovers

Because of the way I spent my money, I couldn’t afford to buy the things that aligned with my priorities and made me happy:

• Personal development
• Retirement
• Selfcare
• A meal subscription box so I could eat a variety of healthy, delicious meals and eat out less often
• Date nights
• My blog
• Nice clothes that I felt comfortable and confident in
• Investment portfolio
• Travel

But to be able to afford these things, I had to change my mindset on money

I used to think of budgeting as income – expenses = fun money. But now, I think of budgeting as income – self-investment – living expenses – other priorities = 0 (also known as zero-based budgeting).

How I used to think of budgeting:

$200 for a day at a spa sounds crazy. But I can afford $30 on brunch with some friends every week.

Because I revisited my priorities:

I switched out two months of weekly meal outings for a day at the spa. Turns out, a day at the spa once every 2 months makes me much happier than eating out twice a week.

How I think of budgeting now:

Instead of spending $30 on brunch every week, I can save that money up for a day at the spa with a massage, facial, lunch, access to the spa and have some money left over.

Because I was so excited after that spa day, I took a hard look at my budget to see what else I could switch out.

Here’s how I save money:

• Drink office coffee instead of going to a coffee shop
  • My taste buds weren’t a fan, but at least I got the caffeine I needed
• Changed my internet package and renewed the contract
  • I had this on autopay so I didn’t even realize that my contract had expired. Not renewing your internet package is like paying month-to-month rent (expensive and unnecessary if you know you will be staying for a while).
• Put aside 15% of my paycheck toward my 401K and pretended that new amount on my paycheck was what I always received
  • By doing this, I prioritized my retirement funds and didn’t have to see the money being taken out of my account.
  • More information on the benefits of signing up for your employer retirement plan
• Only shop during sales
  • I subscribed to all of my favorite stores’ mailing lists and only shop when there’s a sale. Sometimes I see something that isn’t on sale. When this happens, I bookmark the page and whenever I get a sale email, I check to see if that item is on sale. If it’s not, I wait. If it is on sale and in my size, I get it. If it’s on sale but doesn’t have my size, I make peace with the fact that I just wasn’t meant to have it.
• Borrow books from the library
  • I only buy the books that I feel I will need to reference again. As a bonus, this saves space in my apartment and means fewer things I need to KonMari (so in a way, it also saves time).
• Keep a list of the big-ticket items I want to buy at my desk and on my notes app
  • Whenever I feel the strong urge for retail therapy, I take a look at those lists and remind myself “I can spend $15 on this cute mug or put that $15 toward a trip to visit my family.” Then I put aside that $15 so I can spend it on a big-ticket item.
• Exchanged some outings with the girls for a day at the spa
  • Saying “No” to friends isn’t selfish
  • I love time with my girl friends and still make sure to have time with them because when we are together, we spend more than half of the time laughing. But I did spend a lot of time complaining about work drama and found that a day at the spa was a more fulfilling emotional and mental coping mechanism. Needless to say, time with my friends has become more light-hearted.
• Switched out my take-out/fast food budget runs for a meals subscription service
  • By buying a meal subscription service, I actually save money because I don’t need to eat out as often
• Started being more selective about how my boyfriend and I spend money on date nights
  • Date nights don’t always have to cost money
• Use my credit card so it works for me
  • I completely pay it off every month and use points to get money back.
• Signed up for loyalty rewards at my favorite shops
• Stopped spending money on alcohol
• Buy in bulk
  • Things like cleaning supplies, toiletries, and spices have a long shelf life so I know that I can buy these items in bulk and not worry about things going to waste

What’s next?

Check out these other blog posts on personal finances for recent college graduates:

• How I paid off my student loans in less than 5 months
• 7 Personal finance tips for new graduates
• 6 free personal finance spreadsheets for yours 20s
• Should you be using cash or credit to pay for expenses?