The very first thing to do if you want to spend less, according to financial planners

Business Insider

24-05-2025

Even if you know you need to spend less, it can be hard to know where to start. Learning how to budget can be overwhelming without guidance, and not going in with a strong plan can lead to frustration and difficulty sticking to your goals.
Business Insider asked CFP® professionals what their first response would be if their clients asked them how to spend less. Their responses fell into three major groups, all focused on understanding how you can make your budget work for your savings goals.
Understand your motivation to spend less
When asked the first thing they'd say if a client wanted to know how to cut spending, multiple financial planners said they would first want to dive into the client's motivations.
Understanding your motivations will not only keep you dedicated to spending less, but it will also help you determine what cost-cutting steps you should take going forward.
"I think understanding the why is really important, right?" says Christopher Stroup, CFP® professional, founder and financial advisor at Silicon Beach Financial. Stroup says the cause could be credit card debt, a dwindling bank balance, or just wanting to be more proactive about saving. "Ask what's behind their reason for that, so we can better understand what to do next."
Once you have a firm grasp of why you want to save, you can start diving into your current spending habits.
See if your current spending matches your priorities
Before you can start cutting down on expenses, you need to know what expenses there are to cut.
"The first thing I tell them is to understand what they're spending now; to really get clear on, OK, what are you currently doing? Let's make a list," says Angela Moore, CFP® professional, financial guide at Fruitful.
She says that doing this can help you spot easy places you can save, whether by cutting subscriptions you aren't using or negotiating bills down.
Valerie Rivera, CFP® professional, founder of First Gen Wealth, says it's important to review your spending and make sure it's aligned with your priorities. "So I ask them, do you feel like, now that you've reviewed your spending, that your money is going to where you prioritize? And a lot of times, what I hear is, 'Oh my goodness, no, I had no idea that I was spending this much on takeout.'"
If you're struggling to know where to start on sorting your spending, a budgeting app can help. Apps like Rocket Money, Monarch Money, or the YNAB App can auto-sort your expenses and categorize them for you. You'll probably have to go through and manually sort your expenses afterward, but budgeting apps give you a place to start if you're overwhelmed.
Apps like Rocket Money even offer concierge services, which will do things like cancel subscriptions or negotiate bills for you. These services come with fees, so you'll have to decide whether those fees are worth the money you'll save.
You'll also want to consider whether you're willing to pay money for a budgeting app, or if you'll want to use a free one. Free budgeting apps are hard to find, but many apps, including the YNAB App and Monarch Money, offer free trials. If you just need help getting started, you could start a free trial with one of these apps and copy the information into a Microsoft Excel sheet before the trial is done.
Choose one or two areas to focus on cutting spending in your budget
Once you know what you're spending on, you'll need to actually start cutting spending.
Adrianna Adams, CFP® professional, head of financial planning at Domain Money, says that once you know what you're spending on, it's time to choose one or two places to cut spending.
"The very first thing is you have to do a deep dive of where your money is going, because you need to pick one or two things to focus on," says Adams. "When clients just try to pare back everything, it's very hard to really make any habitual changes," she adds.
Choosing budgeting areas to concentrate your energy on also lets you keep discretionary expenses that are meaningful to you while cutting spending in areas that aren't as important.