We all are or were victims to spending excessively. A look at your bank statements and bills reveals that your money is slipping away like sand that slips through your fingers.
Maybe you always have to have the most recent electronic gadgets like phones, televisions,home theaters etc
It could be that you always purchase something that’s on sale, even if it’s not budgeted for OR you don't really need it.
Whatever it is, you know it’s a problem that needs immediate attention.
Why do People Overspend
Adjustments.
Once an individual wants to live a false life, he spends more to meetup with his/her desired standards and sometimes even encroaching on budgeted savings account.
For married couples it could be you may be new to the world of paying bills and sharing expenses. It could also be that you and your spouse have different approaches to money. For example, one might be more inclined to spend while the other is more inclined to save. It takes time for a couple to adjust and develop an agreed-upon method of handling money.
Procastination.
When you delay the payment of bills in time it eventually piles up and you end up spending more to cover your bills
The “invisible money” trap.
It is easy to overspend when you cannot see the money leaving your wallet or purse. That may be the case if you handle most of your transactions by credit or debit card, Internet purchasing, and electronic banking.
What you can do
Setup a budget
Write down all of your expenses, no matter how small, for a month. That will help you to figure out where your money is going and to identify any unnecessary expenditures.
Make a list of your necessary expenses, including food, clothing, rent or mortgage, car payments, and the like. Put a ‘price tag’ next to each category, projecting how much it will cost you within a given time, perhaps a month.
Allocate funds each month for separate expenses (food, rent, fuel, and so forth). Some do this by putting cash in envelopes, one for each expense category. * If an envelope becomes depleted, they will either stop spending in that category or transfer money from another envelope.
Review your thinking of possessions.
Happiness does not depend on having the latest things. Hence learn to say no when the urge do get the latest things comes up.
Take only the cash you need.
Heading to the grocery store for your weekly shopping or heading to work, only take the cash you need based on what you’ve budgeted.
So if you’ve budgeted $100 for groceries, hit up the ATM and get $100 cash out. Throw that $100 in your wallet and leave all of your credit and debit cards at home.
Yeah, you read that right. LEAVE YOUR DEBIT AND CREDIT CARDS AT HOME!
Why? Well, think about it this way.
If you take $100 in cash to the grocery store because that’s what you’ve budgeted, what happens when you get to the checkout and find out that your bill is $120?
You’re going to whip out your debit or credit card to pay for the difference, right?
You’re not going to put $20 of merchandise back at that point. How embarrassing!
But if you leave your debit and credit card at home, I guarantee that you’re going to grab your calculator and add up everything in your cart as you put it in.
If you find out that you’re over your $100 budget, you’ll start prioritizing the items in your cart and putting things back.
With ONLY the cash to work with, you have not other option but to make it work. There isn’t an out.
Make adjustments.
Let me start off by saying; you’re not going to change your bad spending habits overnight.
Just as it took you several months or even years to create the habits, it’s going to take a little while to break them.
There’s no way you can make that drastic of a change that quickly.
Even a slight change in your habits can have a lasting effect.
Slow and steady will win this race.
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