Use Financial Roadblocks to Trick Your Brain

If you make it harder for yourself to spend money, then you'll avoid temptation.

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Have you ever wanted to buy something online but didn't because your wallet was in the other room? How about when you saw something on sale in the store but didn't buy it because the line looked too long? Those roadblocks prevented you from spending and, for the most part, you weren't any worse off without having made the purchase, right?

[Slideshow: 10 Things to Splurge on This Summer.]

Responsible financial roadblocks, when used properly, can help you adjust your behavior even when your willpower can't. It's really easy to make decisions when you're not emotionally invested, so you need to throw a few roadblocks in your way so it’s harder to make bad decisions.

Save with CDs

If you have a problem saving money, consider "locking" up your funds by putting them in a certificate of deposit. You get a higher interest rate on your savings but you can't withdraw your funds without a penalty. It's usually a pretty stiff penalty too, enough that you probably won't do it unless you're facing a real emergency.

There is also the added benefit of earning more interest. The best CD rates pay more than a savings account, so you get a roadblock and a benefit all rolled into one.

Freeze Credit Cards

Credit card debt is insidious. It's so easy to spend when all you have to do is swipe a little piece of plastic and worry about it later. They're designed that way. It's the same reason why casinos use chips - your brain doesn't recognize it as money.

The easiest way to stop yourself from spending on your credit card is to leave them at home. If you're at home and a compulsive online shopper, this isn't enough! You need to freeze them in a block of ice. This makes them accessible, if you can wait until they thaw, but it lets you lose the emotional buying impulse while you wait. This is a technique very popular among people trying to pay off credit card debt because it stops you from buying spontaneously but still lets you use the card if you really need to.

[See How to Lower Your Credit Card Interest Rate.]

Don't Save Credit Card Information

Remember the example I gave in the beginning about not buying something because your wallet was in the other room? Web companies know this, which is why they "let" you save your credit card information into your account. This solves that problem, so you need to reintroduce it by not saving your credit card information.

You should also avoid anything that makes your purchase easier, such as Amazon's 1-Click purchase system or their new PayPhrase system. Don't sign up for Amazon Prime, where you get 2-day shipping for free, so you are forced to think about each purchase.

The next time you want to buy something on Amazon, you'll have to wait until your card thaws and then enter it in! (Bonus: Since your credit card information isn't stored anywhere, it can't be stolen there either!)

Don't Carry A Lot of Cash

Finally, don't carry a lot of cash if you know you have a tendency to spend it if you have it. With your credit cards frozen in a block of ice at home, you'll want to be smart about how much cash you have on you because the less you have, the less you can spend!

If you're worried about emergencies, I recommend keeping a debit card on you in the event you find yourself needing additional purchasing power so you can use an ATM (or the card directly). If you don't like debit and prefer a credit card, keep an emergency one sealed in paper (it's better than having nothing in the way of you and spending) you can bust into should you need it.

What did you think of these financial roadblocks? Are there any that you current use or a roadblock I haven't mentioned?

Jim Wang writes daily at his personal finance blog Bargaineering and can be found on twitter as bargainr.