Overspending can happen for many different reasons. People can spend too much due to stress, poor financial planning, guilt, and a myriad of other feelings and situations. Unplanned emergencies are also a common factor in overspending. Overspending is a dangerous financial problem, but it can be overcome by self-discipline and proper organizational skills. Without proper planning, overspending can lead to more stress and further financial difficulty.
One of the most common ways that people find themselves overspending is stress. It is a cycle, that creates more stress, but it can be avoided. If you find yourself in a position that you feel a tendency to overspend, such as you are under time constraints or physically being in a store causes you to impulse shop, don’t be afraid to delegate shopping trips to family or even friends. Creating a shopping list and handing it over to someone you trust, can help stop overspending. If this person is a friend, suggest swapping lists. When you go to the store, you must have the self-discipline to purchase from your friend’s list alone. If this is still too difficult, a family member would be the perfect solution.
Another cause of overspending is just poor management of funds. If you do not have a budget in place, this can be the perfect time to start one. Several free online options are available to help track spending and create a budget. Online services such as Mint.com, will import all of your bank and credit card accounts for you, and also creates categories automatically (that you can of course edit) based on your debit/credit card purchases.
One of the hardest obstacles to overcome regarding spending is organization. If you do not have a bookkeeper or account, you really need to be a bookkeeper for yourself. It helps to set aside time, either daily or weekly, depending on both your schedule and financial situation, to balance your checkbook and budget (which should include an emergency fund). Keep your records neat and organized. You typically do not need to go out and purchase new supplies for this purpose. A three ring binder and a few folders with pockets may be all you need to start with. Keep bills, receipts, a checkbook, stamps, envelopes, and anything else that you need all in one place, and this will help alleviate overspending due to unpreparedness.
Overspending has a host of different causes, but it is important to remember that they all have solutions. Asking for help is not a sign of weakness, but a sign of strength. Often people take on more than they are able to, and that can lead to financial burden. Taking as much stress off of the situation as possible will help solve this problem.