5 Psychological Tricks to Help Save More Money

1. Change your environment, change your behavior

Our environment exerts a powerful, often subconscious, influence on our choices. And these days, the pressure to spend is everywhere. Just think about the last time you scrolled through your favorite social media apps—how many ads or sponsored posts did you see in your feed?

According to behavioral scientist Wendy De La Rosa, “We have to recognize that the environment is stacked against us. Everything around us is focused on spending.” And if your environment is making it too easy to spend, she says, you’ll need to strategically alter your surroundings to set yourself up for financial success.

“The number one question to ask yourself should always be: How can I reduce my exposure to this environment and make good financial decisions easier for myself?” De La Rosa continues. If you know it’s hard to resist ordering food delivery after a long day, or that you’re susceptible to social media advertising, simple actions like deleting those apps or removing your credit card information from them can make spending a little less convenient (and saving a whole lot easier).

2. View your money as weekly income versus monthly

A monthly or bi-weekly paycheck can often feel like a windfall, leading to an inflated sense of how much discretionary money you have to spend. To avoid unnecessary purchases when that check hits, try reframing your financial perspective by thinking of your income in weekly chunks. You might suddenly find that a daily coffee or impulse purchase feels like a larger percentage of your “weekly allowance.” It’s a simple mental shift that can go a long way toward encouraging more mindful spending throughout the month.

De La Rosa also recommends creating a “frequency budget” to hold yourself accountable. “Instead of focusing on the amount of money in your account, which can be hard to track, focus on limiting the number of times you go out to eat or use ride-sharing apps,” she says. “If you set a limit of eating out two times a week, you'll have a much easier time adhering to your budget.”

3. Use the power of pre-commitment to help unlock financial goals

It’s easy to set intentions or tell yourself you’ll start saving next month—𠊋ut following through can be much harder. Why is that? According to De La Rosa, “Fundamentally, we think about ourselves in two different ways: our present self and our future self,” she explains. “But the reality is, who you are today is most likely going to be who you are tomorrow, and we can use that bias to our advantage.”

Pre-commitment, De La Rosa explains, is a great way to encourage follow-through on your financial goals. This strategy involves making a decision now about an action you’ll take in the future—making it harder to deviate when temptation strikes. “Think about when you might have some extra income coming in, like a tax return or an extra paycheck if you’re getting paid weekly,” she says. “If you know you’re getting some extra cash, pre-commit to yourself saying, ‘I'm going to save 20% of that extra paycheck.’” The key, she explains, is making those commitments easy for yourself, and ensuring you’ve changed your environment accordingly to support those goals.

4. Leverage “fresh start” moments for saving

Psychologically, we’re more motivated to make changes during “fresh start” moments or periods of transition. Many people find it easier to start focusing on their financial goals when it feels like a “new beginning,” notes De La Rosa—and we can actually create those moments ourselves. “You don’t have to wait until the new year or a major transition to create those ‘start moments,’” she says. You can tie them to a birthday, a new season, the beginning of every month, “or even the start of a sporting season—your team is going to win this year, and so are you!” 

The important thing to remember about “fresh start” moments, De La Rosa adds, is that they don’t happen until we make time for them. To that end, “I like to ask people to take a financial health day,” she says. “Everything that we’re talking about takes time, so it’s important to understand your current situation and goals, and commit to making some of these important changes.”

5. Get a handle on small, frequent purchases

Those daily coffees and small online purchases can seem insignificant in the moment, but they add up over time. If you start tracking these minor expenses for a few weeks, you’ll likely be surprised by how much you’re actually spending. (De La Rosa notes that some of the most common financial drains she sees come from food delivery apps, bar tabs and sports betting.)

Once you have a clear picture of your cash flow, you can identify areas where you can easily cut back without feeling deprived. A few small reductions in frequent purchases, De La Rosa says, can lead to significant savings over the long run. “The most important part in behavior change, at least in my mind, is not trying to engage in this massive overhaul of your personality,” she explains. “You can still buy things that you bring you joy—you just have to be mindful about it. Engaging in just small, tiny improvements that compound over time can go a long way to improving your financial future.”