Money » Get Out Of Debt » How to Deal and Eliminate Overspending
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How to Deal and Eliminate Overspending

Overspending is is one of the most common problems among Americans. Here's how to understand your weakeness, control them - and deafeat overspending.

You can trust the integrity of our unbiased, independent editorial staff. We may, however, receive compensation from the issuers of some products mentioned in this article. Our opinions are our own.

Overspending is something that many people do and, unfortunately, it’s something that happens for a number of reasons.

But in order to make it stop you have to understand why you’re doing it.

There are a number of different reasons that people spend so much, and understanding those is how you can stop yourself.

Are You Overspending?

If you find yourself doing any of the things that we’re going to talk about here, you might be guilty of overspending. And that could be making a mess of your financial future.

  1. Your credit cards are maxed – If you have maxed out your credit cards then chances are you have a problem with overspending. For some, it may seem like there’s no other way to make ends meet, but the truth is that it is possible. You’ll just have to start small, by paying off those cards and then not spending on them anymore.
  2. Your money disappears – Do you ever wonder just where you money went to? Maybe you feel like the money just disappears after you get paid. Well, if that’s the case then you absolutely need to be looking at where it’s going and why it’s going there.
  3. You want to splurge, a lot – If you find yourself splurging on things that you don’t need frequently or you can’t seem to tell yourself no that’s definitely a bad sign. If you find yourself online shopping or even going to the store several times a week to buy things you could be falling into this category.
  4. You buy too much – There are always going to be things that you need. And there are going to be good deals that you may want to take advantage of, but there is such a thing as too much. If you find yourself buying more of some than you need or could use in a reasonable amount of time then chances are you’re overspending.
  5. You’re terrified of getting declined – Do you always worry that your card is going to be declined? Maybe you’ve had it declined before or maybe you’re just always afraid. Being afraid of having a card declined is definitely a sign that you’re spending more than you should.
  6. You got a raise, and spent more money – If you find yourself always spending more, every time you get a raise, you’re likely spending more than you should. It’s normal to get a raise every so often and that should give you more money, but if you find yourself spending that money too, you’re probably overspending.
  7. You pay the minimum due on your cards – If you spend a lot but then pay as little as possible that’s definitely a sign that something is going wrong. You want to make sure that you are paying off your credit card every month or at least paying a good portion of it.

How to Defeat Your Overspending?

So, what are you going to do about your overspending problem? The first thing that you need to do is admit that you really are overspending. The next is to figure out what you can do to reign in your spending and make sure you can break this cycle.

1. Know What You Spend

The first thing that you absolutely need to understand is how much money you’re spending right now.

If you don’t know what you’re spending how could you possibly make a decision to save money?

How could you know where you can cut your spending? Keeping a journal of all the money you spend is the best thing that you can do and it’s going to make you even more accountable.

2. Know Where You’re Weak

What are the things that you absolutely can’t stop spending on? What are the things that you find yourself spending too much on time after time? These are the things you need to work on getting rid of.

Lifestyle Triggers

Some people get used to a certain type of lifestyle and this can make it difficult to make changes or to change your overspending. For many, getting a bigger paycheck over time causes them to change their lifestyle and sometimes a little too much.

Mood Triggers

Many of us have triggers related to the way we feel. If you feel happy you may impulse shop or if you feel upset or depressed or even stressed or anxious. You may start to seek out buying and spending money as a way to make you feel better.

Environmental Triggers

Sometimes being around certain people or in certain situations can make you more likely to spend money. These are things that can cause you to act irrationally or spend impulsively even though you know that you shouldn’t.

Some of the most common ways people overspend include:

  • Going over on a data plan
  • Eating out when it’s not necessary
  • Buying more of an item you already have
  • Impulse online shopping
  • Shopping sales

The best thing that you can do is figure out what habits you want to get rid of and then start looking for ways to get rid of that bad habit and replace it with something good.

3. Create a Budget That Works

Creating a budget can be difficult and some people struggle with it more than others. That’s why you need to be realistic about the budget that you set. Don’t try to set something you’ll never be able to stick to. Instead, look at where you’re spending money and where you could be saving.

If you have money left over at the end of your budget that’s a surplus and if you find you’ve spent more than you have that’s called a deficit. But you can work with either one to get a good budget.

Your ultimate goal is to increase the money you have left over so that you can pay off the debt that you already have. This can be done in a few different ways.

First, you may need to look for ways to make more money. For some people this is easy because they can work on increasing sales or increasing the work that they take on.

For those who work on a salary, however, it’s going to be difficult to get more money coming in unless you can negotiate a raise or you take on an additional job. You may want to look into a second job even as a temporary situation so you can pay off debt and then go to a more ‘normal’ job situation.

The next option is to look at your budget and see where you could. Do you really need to buy all of the things that you do in a given month? Do you really use all of those services?

Well, this is a good time to look into it and see what you could be doing instead or how you could be cutting back on some of those expenses in the best way possible.

4. Change Your Bad Spending Habits

Getting rid of bad spending habits is going to be hard enough, but you can make it easier if you actually replace an old habit with a new one instead. Look for some different ways that you can change out how you’re spending and the bad things you’re falling into.

  • Watch for Triggers – You want to look at the triggers you identified earlier and then look for ways that you can avoid them. If it’s certain places or certain people you may need to cut down on just how often you do those things or go around those people. That will help you to cut back on your spending because you won’t experience the triggers themselves.
  • Watch Your Emotions – It’s very easy to get caught up in emotions and feel like you can spend your way into feeling better. Instead, make sure that you’re not making decisions when you’re feeling overly emotional. You want to make sure that you’re slowing down and making more informed decisions rather than letting your emotions guide you.
  • Know What You Need – Pay attention to the things that you actually need and focus on buying only those things. You’re going to want to do your research as well. Make sure that you’re not buying things that you see advertised somewhere just because they seem like a good idea. Instead, look for ways that you can cut back on the unnecessary spending and the impulse purchases that aren’t actually necessary at all.

Making decisions about proper spending is important, and it means you absolutely need to look at what you’re buying and why you’re buying it before you make that purchase.

  • Know Your Surplus – before you buy something make sure you look at how much money you actually have available and whether you can afford it. You should only be spending out of the surplus or money that is earmarked for that particular item. That way you’re not going to find yourself in even more debt.
  • Watch Your Lifestyle – It can be very difficult to keep your lifestyle the same even as your income continues to increase but it’s important to do just that. Increasing your lifestyle to match the money that you have coming in is a very good way to find yourself in trouble later on. You could end up with trouble meeting your expenses and making your payments on time.
  • Use Your List – Making a list is an important first step but actually sticking to that list is the next step. Make sure that you’re watching your list and that you’re buying only the items on the list. This will give you more control over what you’re spending money on and it’s going to help you cut back on buying things that you don’t actually need.