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Going on a so-called cash diet may not be the best way to fatten your wallet

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It sounds like a great idea. To solve your financial woes, you temporarily change your habits and hope that will result in more cash and better habits.

Problem is, it may backfire. At best, the key word is "temporary." Just like with food or health diets, whatever you do to make some kind of change has to be sustainable and permanent.

If you merely cut calories for a month, the weight will come back when you resume your old eating habits.

If you ramp down spending for a month, your financial picture is going to return to its former dim view when you go back to dinners out and shopping sprees.

Whether or not any diet works is up for grabs.

Monica Sipes, a certified financial planner and senior wealth advisor at Exencial Wealth Advisors in Frisco, Texas, never recommends this strategy.

"It usually follows an overspend or a bad financial situation," Sipes said. "It's a restriction, often temporary, and I haven't ever seen it work well."

You're better off with a budget and some financial goals, which you support with some type of savings and perhaps a sacrifice. "Ultimately, it comes down to why you are making the decisions around your money, not a temporary restriction to undo bad spending habits," Sipes said.

The 'diet' problem

Alicia McElhaney, founder of She Spends, a personal finance website aimed at women, says there's nothing wrong with comparing saving with healthy eating. "It's described as an investment in your future, which is great," McElhaney said.

What McElhaney doesn't like is when people equate not saving money with being overweight or lazy. "I've seen quite a bit more talk about dieting, body hate and discomfort with fatness on social media in personal finance circles than I expected when I first got into this," McElhaney said.

Weight is a fraught subject in our culture, McElhaney said, "so, of course, it seeps into everything, including personal finance."

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The best tips are sensible

The standard diet advice — do it sensibly — holds true for your finances.

A budget doesn't have to be restrictive. It just means you create a plan for your money. Your goal is to become more aware of how you spend, says Lauren Anastasio, a CFP at New York personal finance company SoFi.

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The best time to restrict your spending in a determined, short-term way is when you have a specific financial goal. Whether you'd like to pay off credit card debt or save for a vacation, reducing your discretionary spending frees some income to allocate toward those goals, Anastasio says.

Her firm encourages members to divide their income into three parts commonly known as the 50/30/20 rule of budgeting: 50% should go to fixed, essential expenses such as rent, utilities and insurance; 20% goes into savings; and 30% is for discretionary spending.

Be realistic

As can happen with food dieting, being too restrictive financially can end in a binge. Whether it's money or calories, the goal should be something practical and sustainable.

"Reevaluate your plan and make adjustments," Anastasio said. You can taper off regular check-ins after you've established some good habits.

Definitely tweak your plan as you go along. "Sometimes we like to think we can make it to the gym every morning before work but find that we're more likely to go to the group exercise classes offered in the evening," Anastasio said.

Think mindset

Spending diets, no-buys and no-spends aren't on Pauline Yan's radar. "The brain doesn't process the negative part that well," said Yan, a portfolio manager in Toronto who has a personal finance blog. Instead, all your brain is likely to hear is "spending," "buy" and "spend."

Pauline Yan, 42, says managing your money starts with scouting your feelings.
Source: Pauline Yan

And your brain will then notice all the opportunities to buy and spend.

That's why people boomerang after a diet. "They used up a lot of willpower to make it through," Yan said. "But I find the yo-yoing back and forth to be worse for my overall budget."

It helps to dig into the "why" of a purchase. After all, most of us have pretty much everything we already need. New lipstick? Yan says she's got plenty. "I don't need a new one," Yan said. "Same with clothes. No one needs another little black dress."

Analyze this

Purchases often come on the heels of a feeling. "People are not in touch with what they're feeling," Yan said. "We don't want to admit we feel bad. If we do, we're trained to buy our way out of it."

The solution is to get in touch with your feelings. Why do you want to make a certain purchase?

Yan does two things when she wants to buy something. First, she scouts whether she already owns a similar item. If she does, she writes it down, which sparks her to ask why she'd like to buy it again.

She found herself eyeing a makeup palette that she might use on a trip and had a light-bulb moment. "The reason I liked it is, I really enjoy traveling," she said. "That's going to be perfect when I go somewhere. I was trying to buy the feeling I have when I go on vacation."

Her solution was to plan a trip and find a picture of a destination. Yan kept it in her wallet as a reminder of her true goal. "I feel like a lot of the buying [we do] has to do with a value that we want in our lives," she said. "We're just going about it in a very consumeristic fashion."

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