Few days after payday, do you ever ask yourself, “Where did all my money go?” Have you ever found yourself spending way too much? If this sounds familiar, then it’s likely that you’re overspending.
Overspending is the act of spending way too much money as you have planned in the first place. We can see how this can be a problem, especially in the long run. Thus, it creates issues such as financial difficulties, dept, and even relationship issues. Once this starts to develop, it’ll be a downward spiral from thereon.
If you notice yourself doing this, it’s time to put an end to it as soon as possible. Overspending is a form of addictive behaviour. Like every addiction, this needs to stop before you suffer even more from it.
“How can I be sure that I’m overspending?” you may still ask. Let’s go ahead and identify the signs of overspending to check if you are!
Ten Signs of Overspending
No Idea Where Your Money is Going
If you don’t have any idea where your money goes monthly, then it’s a sign of not spending it on planned purchases.
Stress About Bills
If you feel anxious when bills start to come in because you don’t know if you can for it, this may be a sign.
Declined Credit Card
Once you empty your bank account and max your credit cards, this is a clear sign that you spend too much.
Only Afford Base Payments
When you can only cover the smallest amount of payment for your credit card debt, then that’s a problem.
It is a great habit to keep a budget. It would help if you had a spending plan for the current money you have. If you can’t follow it and balance due to lack of funds, this can be a sign.
If you spend money daily on things that are not necessary, then that’s a bad spending habit and a clear sign.
Have you seen some of your items stored in one place unused? That means you bought things just because you like them. Not that you need it.
When you start shopping every time you want to make yourself feel better, this is a sign of addiction.
A clear sign that you’re living beyond your means would be having a solid income but no savings at all. It indicates that you spend your extra money rather than saving them instead.
Lying or keeping your spending habits a secret is an ample warning since you don’t even want others to know about it. If you’re hiding it, then it must be wrong.
Now that we know the common signs of overspending, we’re done with the first step, knowing if you qualify it. Were you able to relate to it? If so, then let’s look at the reasons why you could be doing it!
Understand Spending Triggers
Overspending is a behaviour that can result from various things. Specific emotional or psychological triggers can cause us to spend more. Before we can get rid of our overspending habits, we need to identify our triggers.
Understanding spending triggers will help us avoid situations that can trigger our need to shop. And once we are already aware of what it is, we can also start making better decisions.
Change in Mood
Different emotional states and moods can make us feel the need to go on a shopping spree. The most common emotions that can trigger this could be sadness, stress, and anxiety.
To make themselves feel better, people lean towards impulsive shopping. It’s what they call “retail therapy.” Try other healthy ways to cope with these feelings instead of shopping!
The Influence of the Environment
Are you aware of environments that make you feel like you need to spend your money? Some places can make you feel obligated to pay even by being there. Cafes, shopping centres, and marketplaces are prime examples of this. What you can do is steer clear of these places to avoid the temptation of buying!
Do you feel pressured to spend more money when you’re out with your friends? Even if your friends have the purest of intentions, sometimes we want to keep up with them when spending. Our feelings of wanting to do or buy what they get can be bad for our finances. Instead, we can decline their invites or suggest plans that won’t hurt our wallets!
Your Lifestyle Towards Money
Being accustomed to a particular lifestyle can be hard to give up once you face financial problems. Once your lifestyle becomes more prominent than your budget, it’s time to quit it before it gets worse. The easiest way to counter this is budgeting with a bold discipline to yourself.
Once you identify your triggers, you can now make your first step in stopping your impulsive spendings. Now we can give you a few things you can do to stop overspending!
Track Your Spending Then Create Budget
Even the smallest amount you spend on purchases can add up to a considerable sum of money by the end of the month. The key to successful budgeting is keeping track of your expenses. It helps you become accountable and aware of where you use your money on. You’ll be able to make smart financial choices by identifying what to cut back on.
To start with, you can create a spreadsheet or a notebook to write your expenses on. Gather all your past bills, so you know how much you spend on your necessities. With that, calculate your monthly income and deduct the essentials you need. Finally, for the money you won’t be using, keep it as your savings!
It’s so much easier to take out your credit card to pay for any item you buy. It’s like buying an item without taking out money from your wallet. You don’t see it when they take out money from your bank account. That’s why it makes it so easy to use. Since we don’t know if the cash was reduced, we may feel like it didn’t significantly damage our bank accounts.
In comparison, using cash makes us more aware of how much we have. Since we see the physical money, we can track it as it diminishes. With actual money, all we can spend when going out is what we have in our wallets. It will help us become more careful with our financial decisions.
Learn To Limit Yourself From Using Credit Cards
Since we’re going to start to use cash, it’s better to forget about our credit card information. Once we start trying to change our ways, we can’t help but feel tempted sometimes. Try to forget that you have one, so this doesn’t become a safety net when you think of overspending.
To do this, you can leave your credit cards at home if you feel like you might use them. If you have it with you all the time and you’ve memorised the information by heart, then cancel it.
Remember that if you want to change your bad habits, you will need responsibility and self-control. By doing this, it reduces the chance of you using the card for spur-of-the-moment buying.
Set Financial Goals
Overspenders tend to live at the moment, not exactly concerned about the future. That attitude makes it harder for them to reflect on how serious this can affect them in the long run.
By setting a financial goal, it’s easier to stay motivated as you overcome your bad habits. Having them will remind you of the reason why you’re making changes and sacrifices.
You can start with short-term goals. When you start becoming more money conscious and less impulsive, then take it up a notch! Once you’ve done that, you can move on to setting long-term goals for the future. best payday loan Singapore
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For everything you do, you also need to reward yourself for being a better spender. It’s a fact that being strict with yourself will help you save money. It is until you lose it and go on a shopping binge because you’ve been too tough on yourself.
It’s alright to give yourself a little reward once in a while. This way, it helps better in trying to stay on track with your improvements. By putting a little cash aside for the things you want, will keep you motivated and sane! Remember that every good behaviour needs a reward!
Learning how to stop overspending can be challenging. Trying to break a habit and becoming more responsible can be more complex. But all this is possible!
As everything is, it takes dedication and time to reform your spending habits. You may feel the urge to go back to it from time to time but don’t feel guilty. That’s part of the process. Once you’ve followed these steps, you will be a step closer to your goal of becoming a wiser consumer!