The 30-Day Rule
The 30-day rule says you can save money if you delay an impulse purchase by 30 days. Does it really work or is it simply bad, regurgitated advice? Many, if not most, personal finance blogs think it’s good advice.
In my personal opinion, I don’t think it’s a good rule for everyone.
As you’ll see, it has advantages but also several flaws. By the end of this article you’ll be able to make an informed decision… You’ll know if it’s right for you or if there are better ways to save money and control your spending habits.
What Is the 30-Day Rule?
The 30-day rule (often called the 30-day savings rule) says before you make an impulse purchase, wait 30 days. During this time, consider the following:
- Do you really need or want the item now?
- Wouldn’t it be better to save the money or pay off debt?
- Isn’t there something else you would rather have?
Make sure you don’t spend the money on something else during the 30-day waiting period!
If after 30 days you still want the item AND can afford to buy it without going into debt then go for it. But before you buy it, shop around to see if you can’t find it cheaper elsewhere.
Note: The 30-day rule applies to cash purchases, including using your debit card. The intention behind it is to help you save money, not rack up more credit card debt.
10 Things I Like About the 30-Day Rule
1. Can Help Some People to Control Their Impulse Buying
There is a thin line between impulse buying and “retail therapy” or having a compulsive buying disorder. That’s why I’m saying it can help some people. People who are suffering from a buying disorder are highly unlikely to find the 30-day rule useful.
2. Encourages More Self-Discipline When Spending Money
The 30-day rule can help people who lack self-discipline in their spending habits to correct their behavior for the sake of self-improvement. It’s easier if you follow a specific rule you believe can help than if you just try to do it naturally.
3. Discourages Wasteful or Unnecessary Impulse Purchases
Many, if not most, impulse purchases are unnecessary, or at least not needed right away. By resisting the urge, you won’t go to the store to buy X just to return home with X, Y, and Z.
4. Teaches People to Prioritize Their Needs and Wants
Most people don’t have the money to buy everything they want. The 30-day rule forces them to consider if they really want an item or if there’s something else they want more. It gives them time to think about it so they don’t later regret they didn’t use the money for something else.
5. Can Help People to Save Money
Deposit the money you need to buy an item in a savings account while you think about it. Once you’ve cooled down, chances are you’ll realize it’s better to have some savings than buy the item.
You don’t have to deposit the money in a savings account. You can keep it in cash or leave it in your bank account. Either way, you’ll still save by not spending it.
6. Can Help People to Pay off Their Debt Faster
It’s much better to pay off high-interest debt such as credit cards first before wasting money on a nice-to-have item. Have a look at my tips on how to get out of debt to see how paying a bit extra can make a big difference.
7. Helps Avoid Instant Gratification Turn Into Buyer’s Remorse
Instant gratification is nice but delayed gratification is much sweeter, and much more fulfilling. Impulse buyers often regret buying an item afterwards, thinking things like: “I shouldn’t have bought it” or “Why did I buy it?” It frequently comes with a sense of guilt!
Buyer’s remorse makes you feel bad about yourself and stirs up a host of other negative emotions. It often leads to the “blame game” where it ends up being someone else’s fault. Many people hate taking responsibility for their own actions!
8. Encourages People to Look for Better Deals
The 30-day rule gives you time to shop around for a better deal. You can end up spending less on an item than you would have spent if you bought it straight away. Comparison shopping is a good way to save money.
9. Doesn’t (Usually) Make People Feel Deprived
You’re not depriving yourself by saying no. Instead you’re saying maybe later.
Saying NO can make you feel as if you’re depriving yourself of something you want (that’s why so many people say YES instead). Feeling deprived can lead to resentment, and have a negative impact on your self-esteem.
Instead of saying yes or no, the 30-day rule allows you to say MAYBE LATER. There’s no negative emotion connected to it. You’re simply being smart by taking time out to think it through.
10. Makes People Feel Less Pressured
Most salespeople are trained to convince potential customers to make a decision right away. They’re also taught what to say to overcome objections. It’s normal if you feel pressured by a salesperson in a store or by a “special” online offer that’s about to expire in 15 minutes.
In their defense, most salespeople know the following… If they can’t convince a customer to buy an item straight away, chances are they’ll never see that customer again.
The 30-day rule helps you avoid being pressured into making snap decisions.
Note: My standard reply to a pushy salesperson is: “I understand what you’re saying but I have a rule to think things over on my own. If you insist on getting an immediate answer then the answer is NO.
10 Things I Dislike About the 30-Day Rule
1. Doesn’t Apply to a Lot of People
The 30-day rule only applies to cash / debit card transactions. It’s there to help you save money by persuading you to hold off on impulse purchases. It’s done in the hope you won’t go through with it after 30 days.
It doesn’t apply to credit card purchases, unless you pay your credit card in full every month. This automatically excludes many people who don’t have money to pay for impulse purchases.
The people who need to save money the most are people with no or little savings and a lot of high-interest credit card debt. They don’t have money saved up that can be used to pay for impulse purchases. They tend to charge impulse purchases to a credit card.
2. Can Turn Rich People Into Misers
A miser is someone who has a lot of money but spends as little as possible. If you can afford to buy lunch for a poor person do it even if it’s an impulse purchase. Waiting 30 days isn’t going to make a difference to your savings. It’s only going to make you feel miserable.
If you’ve been able to save a lot of money on your own, you don’t need an external rule to tell you how to save.
3. Can Lead to a Scarcity Mindset
The 30-day rule can have a negative impact on the way you think.
It doesn’t encourage you to think in a positive manner, such as thinking “how can I afford it?” Instead, it can lead you to believe you can’t afford things, even if you have the money to buy them.
4. 30 Days Is Too long
30 days is a long time to ponder about an impulse buying decision! This is especially the case if you write it down, as some suggest you do, so you’re reminded of it every day. It’s simply occupying too much time in your head. There are many other, more constructive, things you should be thinking about.
Note: Personally, I believe sleeping over something is often a good idea. By all means, give yourself 24 hours to make a decision. But 30 days is getting absurd.
Tip: If you really want it but can’t afford it right now, put it in next month’s budget. If it costs a lot, add it to your savings goals and start saving for it.
5. It's Too Rigid
We’re all unique and have different personalities, dreams, and goals. The 30-day rule doesn’t take any of these or your personal circumstances into account. It simply can’t, and this is where it falls short.
Whatever you may learn about managing your personal finances, you should tweak and adjust it to fit your needs. One size doesn’t fit all… We may all need clothes but that doesn’t mean we should all wear the same clothes.
6. Ignores the Importance of Budgeting
One of the key principles of personal finance is you need to make a budget. It’s very difficult to manage your finances without a budget. This includes managing your expenses, and saving money.
A good budget makes provision for both needs and wants.
Needs: Essential items needed for your survival or to maintain your standard of living.
Wants: Non-essential items that make your life more enjoyable.
Most impulse buying decisions fall under the category of WANTS. What some people don’t realize is your budget should contain both needs and wants. It’s important to have a healthy balance between them.
If you budget correctly, you should be able to afford small impulse purchases such as buying yourself an ice cream without having to wait 30 days!
7. Large and Small Impulse Purchases Are Treated Equally
The 30-day rule doesn’t differentiate between small and large impulse purchases. Whether it’s a low cost $5 plant or a $100 bottle of perfume, it’s treated in the same way.
You can’t even spend $5 on impulse for a new plant for your house or garden. You have to think it over for 30 days first, then return to the store to buy it if you still want it. Assuming the plant hasn’t been sold, it’ll cost you more than $5 if you take gas, parking, etc. into account.
This doesn’t even include the time you’re wasting to return to the store. Time that could have been spent more productively. It simply makes no sense.
8. Relies Too Much on Willpower
It’s difficult to get your personal finances in order without an action plan. And if you have to rely on willpower to save money, you’re in trouble.
The 30-day rule requires a lot of willpower. If you already have a problem saying no to impulse buying, prolonging the decision by 30 days may not be enough.
9. Can’t Always Plan 100% in Advance
Sometimes you really need or want something but haven’t been able to get it. Over time you stop thinking about it. Then you go to the store and there it is! Since you weren’t planning on getting it, it’s now an impulse purchase.
Nobody can plan in advance what they need or want to buy with 100% accuracy all the time.
10. Doesn’t Take Scarcity Into Account
Let’s assume you’re a big fan of Lady Gaga (on any other band). You haven’t heard she’ll be performing in your city in the near future but a friend tells you ticket sales have just opened. If you have to wait 30 days (because it’s an impulse buying decision) you won’t get tickets. If you have the money and can afford it, buy the tickets!
Here’s another example:
You really enjoy honey on your bread but haven’t been buying it because it’s become too expensive. You go to the store and see they’re running a special promotion on honey for the next hour. Pondering about it for the next 30 days is simply not an option.
One of the biggest flaws of the 30-day rule is it isn’t flexible enough and doesn’t take scarcity into consideration.
Is the 30-Day Rule Right for You?
Whether the 30-day rule is right for you will depend on your own personal circumstances.
If you have savings but often waste money on impulse buying then the 30-day rule can help you save money.
If you’re not an impulse buyer, or don’t have money for impulse purchases unless you use your credit card or go deeper into debt, then the 30-day rule doesn’t really apply to you.
However, you can always use some of the concepts behind the 30-day rule, namely:
- It’s always good to think twice before you spend money on an item you were not planning on buying.
- It’s smart to shop around to make sure you’re getting the best deal.
The intention behind the 30-day rule, namely to help you save money by avoiding impulse purchases, is good. It can certainly help some people. However, as discussed in this article, it has some flaws and isn’t suitable for everyone.
I have mentioned 10 things I like about it, and 10 things I dislike about it. The problem I have with “rules” such as the 30-day rule is it removes the personal from personal finance. It tries to impose itself on everyone.
We all have unique financial circumstances and rules are generally not flexible enough to be the right solution for everyone.
At xUSD, saving money is one of five key personal finance areas you need to focus on if you want to achieve financial freedom. It’s not always easy to save money, and many people are convinced they can’t save money.
I wrote an article on the reasons why you can’t save money and recommend you have a look at it. It covers reasons you’re more than likely not aware of. It also explains what you can do about it.
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I’m Casper du Toit, founder of xUSD.com.
Are you worried you may not be able to retire comfortably one day and might outlive your savings? It’s never too late to get financially savvy. My mission is to help you take control of your finances, even if you think you’ve left it too late.