Have you ever started a month with the best intentions of saving money but despite your efforts nothing seems to happen? If that is the case, then you could be a chronic overspender, and you need to find a way of dealing with the problem.
You create a budget and promise yourself to stick to it, but before the month ends, you are facing an empty bank and severe buyer’s remorse. Once you realize that you have already spent all you had in place, you are left scrambling for money – or worse going for a fast money loan to cover non-essential purchases.
Overspending is a bad habit that can result from a poor upbringing, emotional issues or lifestyle inflation. Luckily, there are a lot of things that you can do to curb overspending. Here are a few tips to help you.
Understand Your Spending Triggers
If you want to stop overspending, then you need to identify the emotional and psychological triggers that cause the problem. If you get rid of the triggers, you will eliminate the temptation to overspend.
Do you tend to spend more money during certain periods of the day? If so, avoid going shopping during such times. Are there certain environments that make you overspend or make you feel obligated to spend more money just because you are there? Take away the temptation by avoiding such environments or only taking a few dollars with you.
Do you tend to overspend when in a certain mood or emotional state? For instance, many of us tend to overspend when we are stressed or sad. Instead of hitting the mall while in such a mood, relax at home or find something else you can do, such as going to the gym.
Create a Budget and Strive to Stick to It
A little preparation goes a long way. If you have been living beyond your means, then the first thing you need to do to fix the situation is to create a budget. If you make a habit of consistently living within your means, then you will make it with time.
Consider setting aside an emergency fund that’ll cushion you during the hard times. Furthermore, develop a habit of accounting for every cent you use.
If your expenses exceed your income, find ways of adjusting your lifestyle to match your income. Don’t go for a loan to fund non-essential things such as a vacation or anniversary. You should only get a short-term loan for emergency situations.
Although the journey may be a little bit tough at the start, everything will be fine with time.
Track Your Spending
Once you have created your budget, make sure you track your spending habits to help you stick to your budget. If you tend to overspend the money left after covering what is included in your budget, start to take note of what you overspend on.
If it is non-essential items such as shoes, clothing, or electronics, give yourself a limit and don’t go over it no matter what. Determine how much you can afford and stick to your plan. Remember to keep all your receipts to help you assess your progress.
Set Financial Priorities
Sit down and decide what your top financial priorities are. This may include things such as buying a home, saving for your retirement, paying off debt, or buying a car.
The trick is that if you set a financial goal that you want to achieve, then you can always use it as a benchmark to assess your progress.
Also, if you are working hard towards attaining that goal, you will most likely resist the temptation to splurge money on items you don’t need.
Automate Your Saving Process
If having the extra money in your bank account or wallet causes you to overspend, then you need to find a way of channeling the extra cash into your savings account automatically.
The reasoning behind this point is that you cannot spend what is not readily available.
So, instead of just promising yourself you will set aside funds to cater for your financial goals, open a savings account for each goal and automate the transfer of money from your checking account into your savings account.