Overspending is a bad habit and is one of the best ways to end up in a challenging financial position. With online buying, especially Amazon, eBay, or Etsy, it is becoming harder to get addicted to spending day by day.
However, no matter how hard it is to achieve this goal, it is key to reaching financial independence and fly far away from debt. Overspending is a disease and maybe one of the reasons you have not achieved most of your goals.
However, like every disease has a cure, so does overspending. In order to solve such a disease, it is essential to get to the root of the problem: the causes. Keep reading you may want to draw the curtains on your spending and help you solve them.
1. No Financial Discipline
It is direct and straightforward; you have got to have some financial discipline in your life to live without any trouble well. We often ignore such things regarding it as petty or unimportant, but it is however extremely vital.
Budgeting is one of the many ways of reaching financial discipline, and well, yes, it is essential to overspending. One does not live on a budget; that person has no idea how much he can spend without going well into debt. It is one of the root problems that people face, and it is incredibly tedious, but we all have to grow up someday.
It is ideal for you to take every dime into account, and for that, you have to learn how to make a budget. If you are not a math kind of guy, often people prefer using apps like Digit, which does the math for them and speeds up the process.
The idea is not to make a budget but to also follow it and live your life by it. The whole point of a budget is to bring some discipline into your life, and for that, you have to follow it for it to become real.
2. Temptation
Big word but well, the truth. Everyone often succumbs to temptation, which is well wrong, and before we realize it, we have already made a huge mistake that may haunt us. So, why not skip the haunting part and not let it happen in the first place, shall we?
An example would be an excellent way to explain, so let us say you are invited to go to the movies by your colleagues and well it is not really in your budget. Learn to say no. This well does not mean you stop being social and well stick to working.
Who wants that, right? You have to learn not always to cave in. You could instead invite your colleagues over or maybe go somewhere less expensive. We often give in to the temptation of a few guilty pleasures and end up regretting them in the end. That is why having a budget is vital to realize what to do and when to do it.
You have to be able to find stability in your life by not going overboard or at the same time completely cutting your social life, which is terrible. So you have to try to stay in the middle, and you can only do that if you make a budget and follow.
3. Reckless Spending
This is going to bring back everyone’s guilty pleasures into perspective. I am sorry, but it is essential. It is a lovely day, and you are scrolling through amazon, and you find this fantastic book with excellent reviews. You order the book despite the fact you have fifteen unread books lying around.
This is a prime example, and everyone does it without even realizing how difficult they are making their lives by just being a bit reckless.
Reckless spending is one of the biggest causes of overspending and can be brought back to making a budget. I know I have mentioned budgeting three times already (now four), but it is crucial to ask anyone who tried to get out of debt.
4. Credit Cards
They are the devils that cause havoc in our worlds, even though they can act as a lifesaver at times (more like a lightsaber). No, I am not totally against credit cards, but I consider them a form of debt and are the essential reason people overspend.
Although there are quite a few credit cards that offer a low-interest rate, the less you spend money on credit cards less likely you are to miss a payment or overspend.
Mind that your credit cards are not harmful and help out in times of need, and do not have cash available straight away. Nevertheless, you need to use them smartly without overspending and going into debt cause we would not want that, would we?
I will not tell you to stop using credit cards cause; honestly, it sometimes does help, but you do not have to use them for everything. Try using your credit card smartly without disturbing your financial discipline.
It is hard and requires work, but the fact that you are reading this blog means you are willing to make a change in that case.
5. Emotional Spending And Boredom
This is one of the leading causes of spending as people often succumb to emotions and make decisions based on them. Boredom is also another concept that comes under the shadow of emotional spending because people often spend lots of time scrolling through online stores just because they are bored. Technology!
Smartphones and technology have prevented and hindered us from well spending wisely, which we should try more often. Many people buy when they feel angry or sad. In simple terms, it is their guilty pleasure, which makes them feel better. This is horrible as you are not considering your budget and are not making a sagacious decision. You are harming yourself.
To deal with boredom or emotional spending, try being productive or finding other means of expressing your feelings (by talking). Buying is just a temporary pleasure that comes with many side effects and makes you feel stressed out, hence a cycle. This is how people end up in substantial debt. Try working on a side hustle or trying out a hobby to make use of your time.
6. Making An Impression
Often, we try to impress people by what we are wearing to make an impression of ourselves or be more liked and praised. It is by far the deadliest trap you can ever expect to get into.
Whether you are buying an unnecessary shirt or an unnecessarily expensive shirt or, for that matter, buying a car that you can not pay off always leads to overspending. This is an extremely dangerous bracket to fall under, often hard to get out of.
You might be spending money to impress someone, and maybe the other person is doing the same, and it keeps happening until you are eventually broke. The question is, how do we stop it?
You have to gulp the hard lying truth that you can not buy certain items, or you could create a budget to see whether you could fit it in. You could try to add extra income streams to improve your income, and therefore you could afford without breaking the bank.
Do I advise you to do that? No. The reason is that you do not need to buy expensive things to look good or try to impress someone, for that matter. The art is to make a $10 note look like a $100. With some astuteness, anyone can achieve that.
7. Easy Access To Money
This is colossal problem money has become extremely accessible with bank accounts and now online banking. Everything is on the tip of your finger, and it is hard to control, and that is where “temptation” also falls under.
Technology no doubt has made everything accessible, but it also has created quite a few problems which are often hard to deal with.
Before debit cards, you had to keep track of your balance via checkbooks and mathematics; unfortunately, neither is needed. A debit card has become a problem, and we often end up overusing it and spending more than saving.
This is one reason you should have a separate account for an emergency fund, savings, and spending. You could have only two accounts, but I would prefer 3 to make life more comfortable than it already is.
You could try using cash to prevent yourself from excessive spending and to keep track. Nevertheless, again, you could budget, use an app like Digit and live accordingly at the end of the day. It depends on personal preference. I would go for Digit in this case.
Conclusion
There are tons of overspending causes, which has become an enormous phenomenon and has to be dealt with. We often get attracted to advertisements, sales, or discounts, but we need to put our budget into perspective as well.
No one can afford everything (except for maybe Jeff Bezos), so you need to be smart about your spending and not be oblivious about it.
You can only achieve financial success if you are disciplined and you understand where your cut off is. The sooner you stop overspending and living on a budget, the faster you will grow financially. Eventually, you might be able to afford ten of the things you initially wanted. It is all about patience.
