Does this sound familiar?
You’ve promised yourself over and over you’re going to save. But despite giving your best effort, you’re still living from paycheck to paycheck.
And then you start to ask yourself, “Where has my money gone?”
Most of the time, we overspend without even noticing it. This is because our wants are taking over our needs. We lose track of our priorities. And then we repeat the cycle every month.
It doesn’t have to be this way. If you want to put your spending under control, here are six practical tips you can do to win the battle of overspending.
1. Pay with cash
You know why it’s easier to use your card? Because you don’t feel the pain of parting with your money.
Paying with cash will let you feel that pain. In a good way. So pay with cash whenever you can.
2. Avoid using credit cards
Credit cards are convenient and easy to use. This means they make it easy for you spend beyond your means.
Shopping options such as installment purchases and even “buy now pay later promos” entice you to spend until you notice that you’ve been using up your budget for the coming months. Owning a credit card requires self-discipline. Leave it at home if you’re going out. Or, limit yourself with only one card. You don’t need too many! Avoid bad debts like a plague.
If you’re fond of purchasing online, don’t save your credit card details on every shopping site you’re a member of. This will save you from buying anything as easy as a single click.
There’s a time for when credit cards are good. But develop a good spending habit first. For the meantime, avoid them.
3. Give yourself 24-48 hours
When you get too excited, you can become impulsive and purchase an item without much thought. Don’t get your emotions to take over. Leave the store and think twice.
Do you really need those new pairs of shoes? Wait for 24 to 48 hours before making a decision. If you realize you need it based on weighing the pros and cons multiple times, then buy it. But most of the time, giving yourself time is effective in avoiding an impulse buy because the eagerness will pass. Avoid getting swayed easily with sales talks.
4. Create a budget and stick with it
Plan how will you spend your money by creating a budget. Allocate what portion of your income will go into expenses and savings. Listing down all your expenses will help you see objectively how much you spend every month. Always have a goal of minimizing your expenses and increasing your savings. Not the other way around.
Being conscious of your financial responsibilities and monthly dues will stop you from unnecessary expenses like watching a movie, dining out, or shopping. It is easier to adjust your lifestyle when you follow a budget.
5. Reward yourself occasionally
Sometimes, the more you deprive yourself, the more you end up overspending. You’re working hard, so give yourself rewards.
Depriving yourself will only lead to feeling sorry and then overspending later on. Do splurge from time to time. Remember that it is okay to buy things aside from your needs once in a while. By doing this, you will feel more inspired and more motivated to do well so you can reward yourself again in the near future.
Just remember to spend responsibly. Just because you have the permission to splurge doesn’t mean you’re going to spend more than you can pay for!
6. Remember this formula: Income – Savings = Expenses
Remember this formula. Make it your guide everytime you create your budget.
If you put this formula on your mind, heart, and soul, (that sounds dramatic but that’s how important this is) overspending will never be a problem. What left after savings will be for payment of expenses. You’ll feel secure because you have already set aside money for savings. Go and buy anything you want as long as your monthly dues are already paid for and your savings account have already been funded.
Changing your spending habits is not an overnight process. But make small practical steps and you will eventually develop good spending habits. So if you feel that you will fail and fall into temptations, just remind yourself of your goals and focus. You’ll one day pat yourself on the back for doing a good job.