Do you spend too much money on Amazon? It’s easy to do! Inspired by my recent work with a client, I decided to write a blog post on controlling your Amazon spending.
The lure of Amazon’s vast inventory, convenience and speedy delivery can be compelling. But without diligent tracking, the seemingly innocent clicks can build up, leading to potential overspending. If you feel your expenditures on Amazon are veering off course, you can regain control. This discussion offers practical guidance to help you balance the convenience of Amazon with sound financial habits.
The Magnetism of Amazon Shopping
Boasting a staggering array of more than 12 million products in the U.S. alone, Amazon transforms our shopping experience by bringing global storefronts into our living rooms. Add to this, the ease of 1-Click ordering and free Prime shipping, and it becomes apparent why spending can easily get out of hand.
Harnessing the power of online shopping requires us to be mindful and intentional. Minimize impulsive shopping decisions by taking steps to closely monitor your spending. Here are some strategies you can use to better control your Amazon spending:
1. Know What You’re Spending
An effective first step is revisiting your monthly Amazon expenditure by analyzing your statements or transaction history. If you’re finding it difficult to see how much you have spent on Amazon, the best way is by looking at your transaction history. Simply navigate to “your account” and scroll down to the bottom to find a link to “your transactions.” The insights might take you by surprise.
Understanding where your funds are going provides a firm foundation for implementing spending changes.
2. Curb Impulse Buying
Consider implementing measures to reduce impulsive buying habits. Generally, making it more difficult or increasing the amount of time it takes to buy something can reduce impulse buying tendencies. This is because of the way human psychology works. Impulse buying springs from our desire for instant gratification. More time gives our rational brain more time to kick in and evaluate our purchases.
One solution is to add things to your wish list and come back later to buy them. If that doesn’t work for you, you could delete the Amazon app from your phone, thus establishing a minor roadblock that requires you to pause and reflect on each purchase. Turning off Amazon’s 1-Click ordering on your account can also create a crucial moment for contemplation before confirming your order. Another method would be to delete your credit card information from Amazon. This would make it more difficult to make purchases and it would require more time to do so.
3. Institute a Monthly Quota
Just as with groceries and entertainment, devising a budget for Amazon spending promotes financial prudence. Allocating a fixed Amazon budget on a monthly basis, via an Amazon gift card, helps regulate expenditures. Once the balance is depleted, refrain from further purchases until the next month. Amazon’s Allowance program can also be beneficial in distributing gift card credits for anticipated purchases.
Disciplined buying fosters a more intentional approach to shopping.
4. Cancel Subscription Purchases
Amazon’s subscription feature—a service designed for recurring automatic delivery of select items—is undeniably beneficial. With the potential to secure a 10% to 20% discount on regular orders, it’s an attractive choice for frequent purchases. However, it’s important to consider the long-term impact of such expenses, especially for items that aren’t used in a timely manner.
Taking a few moments to review your account for such auto-deliveries could be beneficial for your monthly budget. Disabling the auto-reorder feature, even temporarily, can help ensure intentional spending. Keep in mind, the beauty of this feature lies in its flexibility—you can reactivate it at any point when it aligns with your budget or the need resurfaces.
5. Assess the Necessity of Prime Membership
Prime membership undeniably enhances your Amazon experience, but it can also unconsciously escalate spending. Recent data illustrates that Prime members tend to spend an average of $1,400 per year on Amazon, a significant leap from the $600 average of non-member shoppers.
If supplementary Prime benefits, like media streaming or photo storage, are not regularly utilized, you may consider downgrading your membership to save the $139 annual fee. You can still responsibly patronize Amazon without being a Prime member.
Better Spending Habits Lead to More Wealth
The convenience of Amazon can encourage inadvertent spending if not closely monitored. And the real danger of overspending is that it puts us at risk of not saving enough money to achieve our lifelong goals like retirement or financial independence. By developing better spending habits, you will be able to save more money and create exponentially more wealth.
Are you earning a great income but struggling to put away money for your long-term goals because you’re spending too much? We’re here to help. Schedule a free consultation, and together we’ll help you develop an effective cash flow plan to keep your spending in check while making progress toward your goals. Contact us at 859-291-9879 or email@example.com today!
Also, be sure to tune in to The Lawyer Millionaire Podcast, where we discuss topics like this and more!
Darren Wurz is a fee-based financial advisor and co-owner of Wurz Financial Services, where he operates the Northern Kentucky/Cincinnati office. He is a CERTIFIED FINANCIAL PLANNER™ professional and has a master’s degree in financial planning from Golden Gate University. Darren specializes in serving the unique financial planning needs of attorneys and law firm owners. He is the host of The Lawyer Millionaire Podcast and author of The Lawyer Millionaire: The Complete Guide for Attorneys on Maximizing Wealth, Minimizing Taxes, and Retiring with Confidence, published by the American Bar Association.
Darren is a member of the American Bar Association and the Financial Planning Association. He is also active in his local community as a member of the Northern Kentucky Bar Association, Cincinnati Bar Association, Covington Business Council, and Northern Kentucky Chamber of Commerce. To learn more about Darren, connect with him on LinkedIn.