In our daily life, spending temptations abound. You might be tempted to buy an extra gadget you don’t really need, a pair of expensive boots when you already have five pairs in your closet, or splurge on the overpriced cookies at your favourite coffee shop. Whole industries are devoted to making you spend money, and even the best financial plans are tested many times each day.

What is the best way to resist these temptations? Rather than just supressing impulses—using “willpower”—you can use strategies that make it less likely to give in to the temptation. Strategies are thoughts and behaviors that can make the temptation less tempting and thus make it easier to resist.

What Are Some Of These Strategies?

There are many different actions and thoughts that can reduce temptation both before and during a tempting spending situation. Some of these strategies include behaviors before a spending situation occurs, such as avoiding tempting situations, making money harder to access, or creating budgets and concrete spending plans. For instance, the cookies sold at your favorite coffeeshop can be less tempting if you brought along a different snack to go with your coffee that you know is sitting in your bag right now. A weekly snack budget might also reduce the number of times you give in to the temptation of the cookies.

There are also thoughts and behaviors that can make overspending less likely when already faced with a spending temptation, such as stopping to think about whether you will later regret the purchase, thinking about your savings goals and your future self that will benefit from any saving decisions today. For instance, thinking about possible future cookie regret, remembering your goal to save up for a vacation, and thinking of your financial retirement plans might all make it less likely you’ll buy an expensive cookie in the spur of the moment.

Are Strategies Effective At Reducing Spending Over A Month?

My colleague Mariya Davydenko and I asked 308 adults to think about specific financial strategies at the beginning of the month. Some participants considered expert strategies (strategies that have been tested and been shown to be effective in lab experiments conducted by psychologists and economists), whereas others were asked to think about and write in their own strategies that they themselves used.

For some participants, they were reminded of these financial strategies several times throughout the month; others were not reminded. For everyone, we tracked their spending during the month.

We expected that people who were reminded of financial strategies would give in to fewer temptations, compared to people who were not reminded of these strategies, which would—across the many days and many spending decisions in a month—save them money.

What did we find? Reminders helped, but the types of strategies mattered, too. Strategies participants generated themselves were more effective! Participants who called to mind personal strategies spent on average $236 less than the control group who was not reminded of any strategies and spent $186 less than those who were reminded of expert strategies.

Why Were The Self-Generated Strategies So Much More Effective?

It might be that personal strategies fit people’s personality and lifestyle better than other strategies, even if those other strategies have been shown to be effective, on average, for spending decisions in the lab. For example, the strategy of keeping future goals in mind might be more effective if this outlook fits with how much a person looks towards the future, but a person who is more present-oriented and less motivated by future plans might not find this strategy all that effective. 

We tested this explanation in another three studies in which we gave participants hypothetical scenarios and asked them to rate how well certain strategies would fit this scenario and how well they would fit their personality. Consistently, self-generated strategies were rated a better fit—both for the situations and for the participants’ own personality. Greater perceived fit was also linked to participants’ decisions to not give in to spending temptations in these hypothetical scenarios and to how effective they perceived the strategies to be.

In sum, strategies can help you keep your finances on track. Don’t just rely on “willpower”! Strategies are an essential part of self-control. And when it comes to deciding which strategies to use, focus more on what fits you personally rather than what experts tell you. Expert strategies might be effective on average, but you know better what works for you personally.

For Further Reading

Peetz, J., & Davydenko, M. (2021). Financial self-control strategy use: Generating personal strategies reduces spending more than learning expert strategies. Journal of Experimental Social Psychology, 97, 104-189.

Davydenko, M., Kolbuszewska, M., & Peetz, J. (2021). A meta-analysis of financial self-control strategies: Comparing empirical findings with online media and lay person perspectives on what helps individuals curb spending and start saving. PloS one, 16(7), e0253938.

Johanna Peetz is an associate professor in the Department of Psychology at Carleton University in Ottawa, Canada. Her research includes a range of topics connected to decision making across domains of personal spending, time perception, and interpersonal relationships.