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Financial guru Dave Ramsey hates debt. And he hates the idea of consumers landing in debt even in the context of buying a car or home. To this end, he often advises consumers to steer clear of credit card usage and pay for all purchases in cash.
Now that advice may be a little extreme, namely because credit cards can be beneficial to consumers. They can result in reward points and cash back on purchases, and they can sometimes provide protection in cases where merchants sell defective products or don't make good on their promises.
At the same time, a big reason some consumers end up with credit card debt is that they use their cards to make unplanned purchases. And the costs there can really add up.
Now that we're deep into the holiday shopping season, it can be especially difficult to steer clear of impulse purchases when every store you walk into has a sale going on. And chances are, even when you're sitting at your desk trying to work, you're constantly bombarded with emails advertising different limited-time offers. Those, too, might prompt you to spend money you weren't planning to part with.
But while impulse buys can be very hard to resist, Ramsey has some good advice for avoiding them. Here are some of his tips worth employing.
1. Follow a budget
If you commit to following a budget, you may be less likely to spend money on a whim. Doing so might mean having to cut back in a given spending category for the rest of the month, and that may be less than ideal. Also, when you put a budget together, you're more likely to be mindful of your spending -- and what you can and cannot afford.
2. Incorporate unplanned spending into your budget
If you plan for an impulse purchase and make one, does it count as an impulse purchase? That's questionable. But Ramsey insists that it's a good idea to incorporate some room in your budget for leisure spending on things you don't necessarily plan in advance to buy. That might help you avoid budget-busting impulse buys, because it's easier to say no to something when you've already treated yourself to something nice.
3. Force yourself to wait a day before completing a purchase
It's easy to get tempted in the course of shopping, especially when you see different items in front of you that look appealing. But Ramsey says that waiting a day to complete those purchases could help you avoid them. Often, once that initial urge to buy something passes, you won't be nearly as tempted to go through with a given transaction.
4. Bring an accountability buddy along when you shop
If you've been known to make impulsive purchases in the past, ask a friend or family member to keep you in check the next time you hit the stores. If that person does their job well, you might avoid racking up extra charges on your credit cards.
Impulse buys can land you in debt, and clearly, that's something Ramsey finds problematic. If you follow these tips, you can avoid spending too much money on unplanned purchases -- and avoid the unfavorable consequences that go along with it.
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