If you want to get ahead in life, it’s important to develop financial self-control and stop bad spending money habits.
It’s no secret that money can be one of life’s main sources of stress.
It seems like some people can never have enough, while others are constantly worried about how they will cover their next bill.
In this blog post, I will discuss why so many of us overspend money and how to stop it!
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Table of Contents
Why Do We Overspend Money?
Before we show you how to stop overspending, it is important to find the root cause of this poor financial habit.
There are a few main reasons why we overspend..
Persuasive Marketing: One of the main reasons is that we live in a society that encourages us to spend money.
We are bombarded with ads, TV shows, and movies that make it seem like we need the newest and best things to be happy.
This is not true!
You can be happy with less stuff.
Peer Pressure: The last reason people overspend is that they are trying to keep up with others.
They see their friends buying new clothes and gadgets and feel they need to do the same.
This is called “keeping up with the Joneses,” and it’s a surefire way to ruin your finances.
Bad Debt: According to CNBC, the average American has $94,460 in debt! Too often, people get into bad debt.
Remember to not go into debt unless you can pay it off on time and it will provide an ROI for the future.
How to Stop Spending Money?
Now that we know some of the main reasons why people overspend let’s look at how to stop doing that.
1) Start With a Monthly Budget
One of the best ways to stop spending money is to create a budget.
Figure out how much money you need for essentials like rent, food, and transportation.
Next, figure out how much you can spend on non-essentials like entertainment and dining out.
Knowing how much money you have to work with makes it easier to stick to your budget.
2) Track Your Spending
Another helpful strategy is to track your spending. This means keeping a record of everything you spend money on for a month.
At the end of the month, look at your spending and see where you can cut back.
You’ll then start to understand where your money is going and how you can save more.
3) Say “No.”
One of the hardest things to do regarding finances is saying “no.”
But if you want to stop spending money, sometimes that’s what you must do!
If your friends invite you out for dinner and you can’t afford it, say no. It’s okay, be honest with your friends and tell them that you’re trying to save money.
4) Find Cheaper Alternatives
Just because you’re trying to save money doesn’t mean you have to give up your hobbies or entertainment.
There are always cheaper alternatives!
Instead of going out to the movies, rent a movie from Redbox.
Or, instead of going out to eat, cook at home.
There are plenty of ways to have fun without spending much money.
5) Use Cash
As mentioned earlier, one of the best ways to stop spending money is to use cash.
You can physically see the money leaving your hands when you use cash. This makes it easier to stick to your budget and avoid overspending.
By having the cash, you can see how little of it you have left in your wallet.
Once you know how much money you need to spend, you could use a credit card but be very careful to ensure you do not overspend and pay it off on time!
6) Pay Yourself First
You pay yourself first by setting up an automated investing or savings plan.
Every time you get paid, a fixed amount or percentage is withdrawn and put into your investment account before you have a chance to spend it.
Paying yourself first forces you to save money and make investing a priority. It also takes the guesswork out of how much you can save each month because the amount is predetermined.
This can be a very effective strategy because it causes friction to go into your investment account to withdraw money.
It also helps with organizing your finances because you will know exactly how much money you must work with each month.
7) Apply The 30-Day Rule
When spending money, we often make decisions based on our emotions. We see something we want, and we buy it without thinking twice. This is why the 30-day rule can be so effective.
The 30-day rule is simple – if you see something you want, don’t buy it immediately. Wait 30 days and see if you still want it.
Use this rule to help to weed out impulsive purchases and help you save money in the long run.
Of course, this isn’t always easy. But it’s a good way to train your brain to think more critically about your spending habits.
And over time, it will become easier and easier to stick to this rule.
Related Content: Impulse Buying | Why We Do It And How to Stop!
8) Unsubscribe From Marketing Lists
If you’re someone who loves to shop, you’re likely on many marketing lists.
Companies know that they can tempt you with their sales and discounts, so they keep you in the loop.
But if you’re trying to save money, these emails can be dangerous. Whenever you see a sale or a new arrivals email, your first instinct is to click and browse. And before you know it, you’ve added a few items to your cart.
If this sounds familiar, it’s time to unsubscribe from those marketing lists.
It may seem like a small change, but it can make a big difference in your spending habits.
By removing the temptation altogether, you’ll be less likely to overspend on things that you don’t need.
Looking for an easy way to manage subscriptions? Look no further than ROCKET MONEY. We love how they provide you with the tools to track spending, lower bills, and track your net worth!
See how you can easily cancel unwanted subscriptions and better manage your money!
9) Develop Delayed Gratification
The ability to delay gratification is a powerful tool that can help you in multiple areas of your life, including your finances.
Regarding money, delayed gratification can help you save for goals, avoid debt, and stick to a budget.
There are a few ways you can develop delayed gratification regarding your finances.
First, consider your goals and what you’re willing to sacrifice to reach them. If you have a goal of buying a house, you may need to delay some other purchases to save enough for a down payment.
Second, think about the long-term consequences of your spending decisions. If you’re considering buying something on credit, ask yourself if it’s worth the interest you’ll have to pay if you don’t pay it off right away.
Finally, remind yourself that patience is a virtue. The more you practice delayed gratification, the easier it will become.
And, as with anything else, the more you put into it, the more you’ll get out of it. So be patient, stay focused on your goals, and don’t give up! You can do this!
We want many things in life, but we can’t always have them right away. This is called delayed gratification, and learning how to delay gratification can be very helpful when it comes to money matters.
It can assist us in saving money for our future goals or avoiding debt.
How to Stop Spending Money – Conclusion
Developing financial self-control requires effort and consistency but is achievable by implementing these strategies.
Start by evaluating why you overspend in the first place.
Is it due to persuasive marketing? Peer pressure? The use of credit cards?
Once you know the root cause of the problem, you can address it more effectively.
There can be several reasons why we overspend money.
For some people, it may be due to peer pressure. We see our friends buying expensive things, and we feel we need to keep up with them. For others, it may be because we are trying to make ourselves feel better.
There are multiple reasons, but by being aware of our spending habits, we can address them and improve our financial situation.
Disclaimer:
We hope the information in this article provides valuable insights to every reader but we, the Biesingers, are not financial advisors. When making your personal finance decisions, research multiple sources and/or receive advice from a licensed professional. As always, we wish you the best in your pursuit of financial independence!
