eMoneyIndeed Make Money Online
Are you guilty of overspending? If you want to stop overspending too much money and inculcate good spending habits without extravagance, here are the top tips to remain in control of your spending.
We all begin the month with a holier than thou resolution to stop spending money. But somewhere down the line small temptations lure us into overspending and you start chipping away at your resources, till you’re left with almost nothing by the end of the month.
You or your overspending spouse could justify yourselves with standard excuses. I never had anything as a kid so I want to indulge myself now. Or, I’m earning well now so I deserve to live a more luxurious lifestyle.
Well, be that as it may, it doesn’t harm to take a check on yourself:
- Your budget says to spend $500 for entertainment, and you spent $800.
- All your credit cards are at max balance.
- You’re only able to pay minimum amount on your credit cards.
- You’re not able to pay fixed expenses like electricity and cable, but are able to offered fancy vacations and clothes.
If one or all the above hold true for you, it’s time to take a hold over yourself and improve your financial health.
How to Stop Overspending Too Much Money
#1. Tracking Expenditure: Stop Spending Start Managing
Today, there are several app options for tracking expenditure. Use apps like Clarity Money or Mint to track your spending, monitor credit and pay off debts. You can also use apps for automating investing, so that it curbs overspending habits.
Check out amounts you are spending on hobbies, personal care, dining out, clothes etc. Check out your credit card statements and cash withdrawals and other shop receipts.
Once you’ve tracked your spending, use this as a basis to create a NEW budget and STICK to it.
- Also See – How to Get Rid of Holiday Debt Quickly
#2. Setting Goals
You can always adjust the goals after a month. The main goal should be to spend less than what you earn, while trying out ways to stop spending money. View your spending for various categories over the past few months and try to reduce it wherever you can. Check out categories where you think it’s a waste of money and can make cuts.
How to spend less money? For instance, if you find that you have spent a lot on eating out or convenience foods, you can reduce the budget allocation.
Also create a special category for unexpected spending, like a car repair.
#3. Learning to Budget for Moneycontrol
Take a leaf from Elizabeth Warren’s book to learn ways to reduce spending. It’s simple. Put 50% of your income for basic necessities. 20% goes towards savings and the remaining 30% for your lifestyle choice, entertainment, travel, clothes and so on. It’s all a part of exercising self-control to avoid overspending.
#4. Spend More Cash
Paying with plastic is more convenient, I daresay. But you also tend to overspend when you use a credit card. It’s so easy to just walk into a store and spend ten times more than what you had planned. You need to feel the pain of paying. Why not use a debit card or just cash instead.
As part of money mantra strategies, if you have to use a credit card, at least set a limit based on your card balance, considering how much you could afford to pay back. Beware of multiple cards, as the temptation is also manifold.
Tip: Use your credit card for necessities and a debit card or cash for clothes, travel, entertainment, etc.
#5. Prioritize Spending
I need to save money. If you’re telling yourself this, firstly, determine your basic or essential expenditure like rent, utilities, groceries and soon. Keep some amount for monthly savings and emergency expenditure. You can spend the remaining amount for lifestyle choices like a gym and travel.
Set up your priorities and work towards those goals. It could be a retirement savings or buying a house or just paying off student loans, mortgage and other debts. When you work towards settling such priorities, you tend to be less tempted to spend on things that you don’t actually need.
- Also Read – 6 Super Ways to Avoid Going Broke in Retirement
#6. Avoid Impulse Buying
Are you guilty of impulse buying? We all are, to some extent. You just saw that beautiful pair of boots on the fly and just bought it. But it only leads to guilt feelings and overspending. Stick to your list and be strict with yourself. There is a difference between wants and needs.
Instead of impulse buying, try sleeping over it. You might end up not quite wanting the stuff the next morning and in fact might even be relieved for not giving in to the impulse.
Tip: Use a calculator while shopping, so that you’re aware of splurging while going around a mall.
#7. The Envelope Method
Why do we buy things we don’t need? One great way to avoid such spending is to freeze your assets. If you don’t have the strength to stick to a budget, just force yourself to save.
Use the envelope method for putting amounts into different envelopes for groceries, utilities etc. Do it the old-fashioned way or use apps like GoodBudget are useful for categorizing.
For instance, once the travel envelope is empty, you cannot spend more on this category. You can even create your budget in advance and put the money, say for groceries, in your store gift cards. You will not be able to spend extra this way, on unnecessary things in life, as you become accountable.
- You May Like – How to Successfully Budget Your Money on Low Income
#8. Automatic Savings
Make your savings automatic. You can put the savings in a 401(k) or in IRA or just in a bank savings account. You can allow your employer to withhold a part of your payment to put it into 401(k).
You will not be able to access that money and it will put a restraint on overspending. Enable automatic transfers of a fixed money to go into your savings account every month.
Wrap Up
Stopping overspending is more easily said than done. Yet, you need to get back on a healthy financial track, otherwise things could go haywire in your life.
Try bargain shopping and stop and shop sales. You can save a lot of money and still get what your heart desires. Know to differentiate between your needs and wants. Don’t buy stuff you don’t need but really want.
Use apps like Remember the Milk for organizing your lists and jotting down items to buy as they come to your mind.
Keep yourself busy, because boredom could also be one of the causes of overspending. Be active, exercise regularly and avoid emotional spending. For instance, don’t buy food when you are very hungry.
A little debt on your credit card is not such a bad thing, but don’t set yourself up for financial disaster. It could even affect your relationships.
Related Articles
Featured Post
