9 Brain Hacks To Save A Ton Of Money


Chances are you are looking for ways to exponentially increase your ability to save money and in turn improve your financial life. If so, you’re in luck because you’re about to learn 9 ways you can trick your brain to save money and have your bank balance growing at lightspeed!

Hack #1: Pay In Cash

When was the last time you bought anything with cash? In today’s day and age, the use of cash is almost non-existent with debit cards being the most popular purchasing tool to use at checkout. However, whether you pay with debit or credit, there is no substitute for the psychological impact that paying with cash can have on your spending behaviors. You see, when you pay in cash, three things happen. The first is that your brain feels more pain when paying with cash than with debit or credit. This pain we feel when we spend cash is due to what researchers call coupling.


When someone buys an item with cash, they immediately know how much that item cost, which can be painful. However, when someone pays with a credit card, there is a time period between when they purchase the item and when they have to pay for it, which makes the cost seem less important. This sensation alone causes most people to spend less and save more but there are two other important aspects of spending with cash you should know. Humans tend to be hoarders of things with higher perceived value and while this means it’s easier for us to spend one dollar or five-dollar bills, it means that spending a hundred-dollar bill is much more psychologically traumatic which prompts us to save it rather than spend it. And you know what that means, more savings!

The final psychological aspect of paying in cash is seeing the depletion of your money. When you pay in cash, you can see the amount of money you have on hand diminish however when you are paying by plastic you do not get that same sensation. As a result, paying with plastic generally makes us spend more money. So just how much more will it cost you to pay on credit versus cash? In 2001, MIT published the results of a study analyzing spending behavior when spending cash versus credit. The results highlighted that shoppers spend up to 100% more when using their credit card to pay instead of cash. Therefore, if you want to curb your spending and employ this brain hack then cut up your credit cards and start carrying around more cash!


Hack #2: Start A Piggy Bank

Now that you’re going to be paying in cash, you’re going to need a place to store all of that loose change. This is where a piggy bank comes into play. You see, before I had a credit card, I used to pay with cash all the time however I would then leave my loose change in my pocket or around the house which meant that I never accumulated any real money in my piggy bank. Then one day, my Dad challenged me to see if over the next year I could fill up my piggy bank with all the loose change I would accumulate. Then, he said that if I could guess the total amount in the jar when it was full, he would double it.

From that point forward, I deposited every penny I got back from my purchases into that jar and come the end of the year I had it completely filled. Then, the moment finally came when I was to guess how much I had saved during the past year. I held up the piggy bank, as if I was able to weigh out how much would be in there and guessed $234. My dad and I then went to the bank to get them to count it. The final count was $187. Seeing my disappointment, my dad gave me an extra $100 to deposit into my bank account anyways but at that point I learned two important lessons. I learned that gamifying money helps you make positive progress in your financial life and that I had one of the best dads on the planet.


Hack #3: Capitalize On Rewards

Now, I know that I have just gone over the benefits of paying with cash but I know that not everyone will be willing to go to the bank and withdraw money every week or every month for their routine expenses which means that I need to ensure you are still saving money when paying with plastic. Now, it would be nice if everything in life was free, but since we need to spend money to live, you may as well make it worth your while by receiving rewards and other bonuses. Nowadays, credit card companies offer very lucrative reward programs in order to entice you to sign up and these rewards usually come in the form of either cashback or points. Cashback will usually range between 1–5% of each purchase or statement total and points will vary depending on the amount you spend and where. What I recommend is that you shop at stores that offer you the most cash back possible so that you can lessen your total expenditures and soften the psychological blow that routine spending can impose.


Hack #4: Use Automated Deductions

What if you could take all the effort out of saving so that you could focus on more important life activities like your job, your family or your friends? Well, one way you can do just that is by leveraging the power of automated deductions. In fact, one of the best things I have ever done for my finances was setting up automated deductions from my pay with my employer. In essence, what these deductions allowed me to do was send part of my paycheck directly into a savings account instead of the full amount going right into my checking account. When I initially set this process up, I allocated 10% of my after-tax income to my savings account but over time I have found I am able to up this to 20% and double my monthly savings. Now, I think this saving technique has been so successful for two primary reasons. First, it allowed me to pinpoint exactly how much I wanted to save. In fact, by using automated deductions, you can set your deduction to the amount you have designated as monthly savings in whatever budgeting system you currently employ to ensure you need your target figures. Second, it took the thought of having to save off my mind allowing me to focus on other important things like improving my skills in order to make more money.


Hack #5: Rounding Up Purchases

What if I told you there was a way to save your loose change without paying in cash? If you’re like me then you hate carrying change around and thanks to round up purchases, you can save money and avoid change at the same time. If you haven’t heard of round up purchasing, here’s how it works. First, you need to set up this function with your debit card provider so that every time you buy on debit, a greater charge is applied to your card than the value of the items you bought. Then, that extra amount will be deposited into a bank account you designate for savings. Here’s an example of how this would work.

You go to Starbucks and purchase your usual latte which costs you $4.35. Instead of paying the $4.35, your card will be charged $5 and the difference of 65 cents will be deposited into your savings account. Now, as one instance this won’t result in much of a savings however when done routinely over time, you will begin to accumulate money in that savings account in the same way you would if you were to deposit your loose change into your piggy bank.


Hack #6: Real-Time Cost Analysis

When you want to buy a shiny new item, what thought goes through your head? What the true value of the item is or how much joy that new item will bring you? I would argue that for more people it’s the latter however if you want to save money you need to assess the true value of the items you buy. One item I used to get sucked into buying regularly were new phones.

I would imagine how great it would be to own the latest phone and enjoy all the new features it had to offer however as you probably guessed, that enjoy I anticipated getting was short lived. In order to truly assess the value of the item you are buying; you need to determine what your usage of that new item will look like. For me, I wanted a new phone for the better camera however I rarely took pictures so the cost I was paying certainly didn’t justify the return I was getting. When you start to analyze all your purchases in this way, you will soon realize that you need to spend much less money than you are presently.


Hack #7: Counting The Clock

The third last brain hack that you can use to save more money is to use the counting the clock method. Essentially, you are assessing how many hours of work every item you buy will cost you. For example, if you make $20 an hour at your job then buying that new $100 t-shirt is really 5 hours of your time. Once you’ve performed this calculation, ask yourself if the item you’re are obtaining is worth the time it took to earn the money to pay for it, or in this example, is that shirt really worth 5 hours of work time? When you begin to see your purchases in this light, it will dramatically change how you perceive the value of not only your money but your time as well.


Hack #8: The Stranger Test

You walk into a store and see a shirt that you think would look great on you. While you now know that you should assess how much time you are exchanging for that $50 t-shirt, you still feel inclined to buy it. Well, before pulling out your wallet and completing the transaction you should be running yourself through the Stranger test. If you’ve never heard of the Stranger test before, let me explain.

Imagine a stranger standing in front of you; in one hand, they have the t-shirt, and in the other hand, they have $50. Which would you rather have? In most cases, the cash is probably more appealing. When taking this approach on a regular basis, you will start to see yourself continuously picking the money over the item which solidifies your position in not splurging and instead keeping that money in hand.


Hack #9: Internalize Saving

While all the other hacks are very useful when it comes to saving money, the number one way to dramatically increase your ability to save is to tell yourself you’re a saver. You see, using these hacks will help you make better money decisions but until you internalize that you are a saver, you will always feel as if the act of saving is going against your own free will. Instead, tell yourself you’re a saver. When you do this, you will be more inclined to take regular action to save money since your actions will be aligned with your core values. Once these values are in place, you will also be more inclined to set money goals revolving around saving, which, when pursued with consistent effort, will ensure that you not only hit these goals but also achieve your stated savings target!