Overspending is a really big problem, especially when we’re young. Our brains can convince us that we need expensive purses, clothes, and so much more when really all we need is to stop throwing our money away!
We’ve all had that moment where we take a look at our bank account and think “where did it all go?”. Even if we have the best intentions to be better and save money it can be so hard to stop overspending. If this is you, I’m glad you’re looking at tips to change your ways because it’s not a good path to go down long term!
7 Tips to Stop Overspending
#1 – Understand Your Reasons
When most people think about shopping, they never take into account the emotions that are connected to spending money. A lot of the time we don’t realize all the crazy psychological reasons we have for overspending.
Personally, I find myself buying things I don’t need when I’m stressed and/or anxious. I sometimes convince myself that buying something new will help me deal with the stress because I get that quick high that makes me feel good. This is a super common trigger for people who are chronic overspenders.
What are some other possible reasons for overspending?
- Confusion of Wants & Needs: It seems like everybody is awesome at confusing what they need with what they want. You don’t need to go shopping when you have a closet full of clothes. All you really need is a roof over your head, food, water, and basic clothing!
- Rewarding Ourselves: Sometimes we can convince ourselves that we deserve a new outfit because we survived a basic everyday event like a hard week at work. Eventually, you can end up buying yourself something just because you got out of bed.
- Past Experiences: I’ve noticed over the years that people who grew up without money are often really horrible with their money and think that they deserve to buy themselves nice things because they’ve earned them, this means they’ll never be out of mental poverty!
- Keeping Up With The Joneses: Trying to keep up with other people causes you to live above your means and makes you think that you’re missing something in your life because someone else has it! You must focus on yourself, and not others.
#2 – Cut Your Cards
There have been studies done that show that people don’t have a real connection between their own money and their credit cards. When you swipe or tap a credit card, it doesn’t have the same feelings associated with it like when you hand over cash. This is why I always suggest that chronic overspenders cut their cards and use only cash.
Credit cards can be a great way to build a credit score and earn points, but they can really mess up your finances if you’re using them to buy things that you just simply can’t afford. If you start to use cash, you’ll find yourself spending less money pretty quickly.
#3 – Start a Budget
Budgeting is the best thing you can possibly do for just about every part of your finances. I get that starting a budget is the worst, it’s stressful and annoying but I promise it’ll be worth it. Having a budget doesn’t stop you from being able to do the fun things, it helps you plan for the fun things while still meeting your other goals.
A budget is just a plan for every dollar. If it isn’t in your budget, you aren’t allowed to buy it. No questions asked. If you want to start a budget but don’t know where to start, I recommend the Zero-Based Budget because it’s great for beginners.
#4 – Set Financial Goals
The best way to start to get motivated to stop spending so much money is to have small, short-term financial goals that you’re working towards. It doesn’t matter what the goals is, as long as it’s short-term and focused. You could be saving for a trip, trying to pay off debt, or building up an emergency fund.
If every single day you’re thinking about your small goals, you’ll think twice about going to the mall or shopping on Amazon. What do you want to accomplish this year? If you need a little motivation, here’s 10 personal finance goals you should hit by 30!
#5 – Track Your Spending
If you’re really caught scratching your head at the end of the month, wondering where your money goes, you must start tracking your spending. If you track every penny you spend for even just 90 days, you can see where you’re throwing your money away and where you can do better.
When you want to lose weight people always suggest to start by tracking what you eat, and this is the same concept! Tracking your spending holds you accountable for your decisions. Keep all your receipts and make a spreadsheet of all the money you spend, and you’ll truly see where you can improve.
#6 – Stick to Your List
Never leave home without a list, not just at the grocery store. If you’re going to the mall and only need some new underwear, stick to your list. Don’t let yourself wander and buy things that you don’t really need. You can use an app on your phone like Google Keep as a grocery list so it’s always on your phone. It’ll cut our so many purchases you didn’t need to make because you aren’t allowed to stray!
You should also stick to a meal plan, and try your best not to stray from it as well. There’s this amazing service called $5 Meal Plan that will send you a detailed meal plan AND grocery list each week for only $5 a MONTH that can help you stick to a grocery budget and stop wasting money on food you’ll never eat. Try it out for free for two weeks!
#7 – Stay Home
Have you ever heard of FOMO? Oh, FOMO is real. For those of you who don’t know what FOMO is, it stands for the Fear Of Missing Out. We see our friends every day having these awesome lives on Instagram and Facebook and we get really jealous and we want to be able to do it too. FOMO causes us to agree to going to events that we don’t really want to go to!
Staying home once in a while can help you stop spending money that you don’t have! You don’t need to go out drinking with your friends every weekend just because you might miss something, focus on your goals!
I know that kicking a habit like overspending can be hard and can be super emotional. You may find yourself struggling but just stick with it. Try a no-spend month, or a shopping ban. There are so many great things you can do, and stopping the overspending habit can really change your entire life. If you need any help or a little motivation, please don’t hesitate to contact me. I’m here for you!
Thanks for reading,