These 4 Money-Saving Life Hacks Can Help You Get Out of Debt

money hacks

You can be your own worst enemy when it comes to managing your finances. You resolve to do better one week, and the next week you’ve sabotaged your finances and fallen off-track.

That’s where money hacks come in. They help you work with your psychology, rather than against it, to make better financial choices.

There are some simple, science-backed strategies that you can use to reframe your finances and make better money choices. Here are four life hacks to save money and help your decision making.

1. Follow the money advice you’d give a friend

When it comes to making tough financial decisions, it’s hard to be impartial. Our money choices are tied up in our own wants, emotions, and judgments. It can be tricky to get past all the personal stuff to make an objective, smart money decision.

That’s where money-saving life hacks can help. If you’re struggling with an area of your finances, for instance, one study from researchers at the University of Michigan found a solution. Distance yourself from your situation.

Based on three experiments, the study found that participants had wiser reasoning when it came to another person’s problems compared with their own.

This money hack means instead of obsessing about your financial issues, take a step back. Ask yourself what advice you would give to a friend, or even a stranger, in the same situation.

Maybe you’ll see the hangups holding you back are really just excuses. Or you might realize that you don’t feel you’d know enough about a financial topic to give friend advice and take that as a sign that you need to learn more.

2. Take a moment before making money choices

Money hacks can be very simple: Even just hitting the pause button before making money choices can be effective.

“Studies have shown that response accuracy can be improved by prolonging the decision process, to allow the brain time to collect more information,” according to a study from Columbia University Medical Center. That’s because the brain needs distraction-free time for the information-processing centers to work.

When you’re making a financial decision, your brain first collects information to base it on.

What’s the price?

What’s your budget?

Is it affordable?

What value are you getting in return?

Pausing and giving yourself a moment free of distractions or new information can give you greater clarity. This allows your brain to fully integrate and process the information. Then you can make a decision based on the most accurate information and analysis your brain has to offer.

3. Visualize your future self

Smart money decisions often comes down to making sacrifices today to benefit yourself tomorrow. But this delayed gratification is hard to pull off because your future self often feels abstract and distant.

Studies show that people tend to view their future selves similarly to how they view strangers or other people. However, people who connect to their future selves make more responsible choices, according to research from the New York University’s Stern School of Business.

In the study, some participants looked at images of themselves that were aged, while others looked at current images of themselves. Then they were asked to decide how to allocate $1,000.

“Subjects exposed to aged avatars put nearly twice as much money into the retirement fund as the other people,” said Hal Hershfield, an NYU professor who worked on the study.

You can imagine yourself five, 10, or more years in the future. Doing so will prime you to make wiser decisions that are will benefit your future self.

4. Switch to cash over cards

How you pay can also affect your financial decisions.

A study from MIT’s Sloan School of Management tested the hypothesis that credit cards increase spending. It found that “willingness-to-pay can be increased when customers are instructed to use a credit card rather than cash.” The effect was pretty dramatic, with people willing to pay up to 100 percent more.

This is because credit cards make money feel less real and tangible than cash, making it easier and more painless to spend. Credit cards remove the natural limits on spending — like how much cash is in your wallet. These limits are replaced by an artificial credit limit.

Plus, credit cards are backed by marketing messages designed to get you to spend. Even a glimpse of a credit card logo can trigger a conditioned response to spend more, according to The New York Times.

That’s why many money-saving life hacks revolve around putting away the plastic and replacing it with paper. Leave your credit cards at home and remove saved credit cards from online shopping accounts. You can even go as far as to freeze your credit cards in a block of ice.

Switch to doing your shopping in-person and with cold, hard cash. It might require a bit of effort and planning, but it can go a long way in resetting spending habits. When limited to cash only, you’ll naturally be more frugal.

So the next time you find yourself financially stuck, try one of these money hacks instead. They can help you get out of a rut and do more with your money.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (
  2. Personal LoansFixed rates from 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 4.98% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 21, 2017 and are subject to change without notice. Not all rates and amounts available in all states. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 4.98% APR assumes current 1-month LIBOR rate of 1.34% plus 3.89% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate Disclosure: Fixed interest rates range from 4.99% – 16.24% (4.99% – 16.24% APR) based on applicable terms. Lowest rates shown are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.39% - 29.99%$1,000 - $50,000
Check rate nowon SLH's secure site
4.98% - 14.24%1$5,000 - $100,000
Check rate nowon SLH's secure site
8.00% - 25.00%$5,000 - $35,000
Check rate nowon SLH's secure site
4.99% - 16.24%2$5,000 - $50,000Visit Citizens
5.99% - 35.89%$1,000 - $40,000Visit LendingClub
5.25% - 14.24%$2,000 - $50,000Visit Earnest
Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print, understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.