If you are constantly in debt or you just never seem to get all your bills paid, it means you are living beyond your means. Overspending is a problem that most people struggle with. Failure to plan and budget for money is the most common and basic cause of overspending. Regardless of how much you make, if you do not carefully consider where your money is going then you may end up broke or in debt. People who spend more than they make normally rely on credit cards and loans and the cycle never ends unless they change. Five most common causes of overspending are:
1. Buying Poor Quality Goods
If you are sending money on poor quality items, then it is most likely you are buying these items more often than you should. For instance, low-quality clothes or shoes will not last long enough for you to make any savings. You might need to buy a new shoe every two months and this does not do any justice to your pockets. Consider quality before you make any purchase and save your money. This way, your items will last longer and you realize you will also not need to buy many of them at once. Shop around before making the actual purchase to identify the sellers who deal in high-quality goods. You can even seek referrals from friends for the best deals.
2. Social Media Hype
The life that most people live on social media cannot be comfortably supported by their income. If you are the kind that wants to get a huge following on social media, then you will most likely overspend to impress your audience. For you to keep up with the social media hype you need to be trendy and this costs money. Following celebrities on social media can also pressure you into overspending to look or feel like them. This is more like chasing after the wind and will only lead you into chronic debt. Do not overspend to portray a certain lifestyle on social media.
3. Fear of Missing Out
Most people have not yet mastered the art of saying ‘NO’ without guilt or explanations. If you are one of those, then you might be unnecessarily overspending for fear of missing out. You just do not want your friends to have fun without you or you feel like they might despise you if you do not go on those many holidays. It is ok for you not to join your friends for shopping sprees if your budget does not allow you. Avoid going beyond your money limits just to fit in. If your clique of friends always pressures you to overspend, maybe it is time you got yourself, new friends.
4. Failure to do Market Research
As a rational buyer, it is important to do your market research well before spending. This helps you to know the market prices of different commodities so that you do not end up paying more. Comparing prices is also another technique that will save you that extra buck you would spend due to lack of adequate information. For instance, if you need a good bed bug exterminator or affordable exterminator, you will do well to look around for the best deal in the market. This way, you will not spend more than it is necessary.
5. Simplified access to Your Money
With all these cashless ways of handling your money, it has become easier for most people to spend money on impulse. The availability of debit cards and digital money platforms have made it possible to make purchases hassle-free. The credit card that allows you to spend money that you do not have might be your enemy of progress. To undo this trap, reduce your digital money sources especially those that easily lead you to overspend. You can even make standing orders to have your excess money into a fixed account. This means you will only have quick access to the amount you need for your basics.
Over-spending is one of the most unhealthy money habits. If you find yourself in a cycle of debts and always not having enough, then you need a lifestyle change. Watch out for the reasons discussed here and many more.