How to stop spending money mindlessly

REUTERS/Mark Blinch

We all know it's important to save money.

Saving for retirement and socking away cash for emergencies often involves making sacrifices. The money that you would have spent on a trip to Uruguay or on new shoes could instead go into your IRA or your savings account.

Making responsible financial decisions can be difficult, of course, and if you're having trouble holding onto your coins, here's how to stop spending money recklessly.

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1. Find out what you're wasting money on

If you're trying to start spending less and saving more, it's a good idea to find out where your money is going. Are you spending a large percentage of it on baked goods or electronics? By being aware of what's causing you to waste money unnecessarily, you can be proactive about avoiding those triggers.

2. Keep tabs on your spending

Having a budget in place is essential if you want to avoid overspending. But if you realize that's not enough, you might have to take things a step further and either use an app or actually write down how much you're spending on a daily basis.

While that might seem tedious, it could also be a huge wake-up call for someone who's prone to making impulse purchases. Seeing that you used two-thirds of your paycheck to wine and dine your significant other might be enough to convince you that it's time to rein in your spending.

3. Get an accountability partner

Kicking a bad habit can be hard, especially if you're doing it all on your own. Finding a friend or family member who can hold you accountable for your actions can be an effective way to curtail your spending.

Your accountability partner can serve as a source of encouragement. Plus, if he or she is also committed to saving more, you can challenge each other to see who can save more money within a certain window of time.

4. Pay with cash

Not everyone has this issue, but for some people it's easier to waste money when you're swiping a card to make a purchase. Paying for $100 jeans might hurt a lot more if you have to hand over a $100 bill instead of pulling out a credit card. If you're guilty of living beyond your means, it might be better to pay with money you already have rather than accumulate interest and credit card debt that might take years to pay off.

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5. Don't shop without a list

Another good tip for anyone with a spending problem: Always make a shopping list and try your best to stick to it. If sales and clearance signs usually drive you to overspend, it probably isn't wise to enter a store or go into certain sections unless you have a legitimate reason for being there.

To take things up a notch, you can make a list in advance, estimate how much each item will cost and only bring enough cash to cover those purchases. That way, you can't buy more than you planned to.

6. Plan your meals in advance 

If you find that you're spending too much on food, meal prepping can help you cut back. By taking the time to think about what you're going to cook for the week (or even for a few days) and setting up a budget, it might be easier to save money. Randomly buying whatever you're craving could be costing you more than you think.