Spending money is fun. The thrill of buying something shiny and new is part of the human experience. But because spending is so fun, it can become a bad habit and impact your ability to save money and live within a budget. Here are 10 quick tips to help you stop overspending.
1. Recognize your spending weaknesses
Knowledge is power. Pay attention to your spending temptations and look back at your bank statements to see where you tend to overspend. When you understand that you have a weakness for a particular store or non-essential item, you can make goals and take steps to keep more of your money.
2. Make a budget
You’ve heard it a hundred times before, but living within a budget is the best way to ensure you don’t overspend. Instead of looking at your budget as limiting, set it up as a way to accomplish your savings and spending goals. Make a category for something you really want to buy and use your budget to save for it.
3. Pay attention to price anchoring
The concept of price anchoring involves making you guess how much something is really worth based on other prices. For example, if you go out to eat at a nice restaurant, you might think you’re getting a good deal on an appetizer that only costs $20 when the rest of the menu is so expensive. In reality, $20 is $20, and price anchoring subconsciously pushes you to spend money you wouldn’t otherwise spend.
4. Beware of social media
Social media is extremely good at making people play “keep up with the Joneses.” It’s a natural advertising platform that feeds big business products and services directly to your devices through content creators, influencers, and even your inner circle of friends. Distance yourself from social media if you need to. At the very least, check your impulses to spend just to keep up with others.
5. Pay attention to price per unit
As you shop at the grocery store, pay attention to the fine print. Underneath the actual price of the item, you may see a smaller per-unit or per-ounce price. This can help you know how much an item really costs. For example, you might spend less money on a smaller box of cereal, but you’re actually spending more per ounce and per serving.
6. Stop eating out
In today’s on-the-go world, nearly everyone overspends on eating. In fact, one of the surest ways to save money is by eating at home as often as possible. It takes discipline, but there’s a reason that restaurants stay in business—they markup the actual cost of food by a significant amount. And that means you’re overspending every time you eat out.
7. Pay attention to your moods
Mood spending is a very real thing. Pay attention to your emotions and which moods tend to trigger spending. Do you like to buy food when you’re hungry (who doesn’t?)? Then try to plan trips to the grocery store on a full stomach. Similarly, pay attention to when you’re most energetic, most stressed, and most tired. These times can lead to impulse buying and overspending.
8. See through the “sale”
You should absolutely try to find the best prices possible on everything you have listed in your budget. You should not buy something just because it’s on sale. Sales can be alluring. They push you to spend money you might have otherwise kept for yourself. Think of it like this: if you get 20% off an item you wouldn’t have otherwise purchased, you’re really just paying 80% more for something you don’t need.
9. Pay off your debts
You might not think of making debt payments as overspending, but the sooner you pay down your debts, the less money you have to spend on interest in the long run. When you have the choice between spending more or less on interest, the concept of overspending becomes clearer.
10. Be grateful for what you have
When you are content with and grateful for what you have, you’re less likely to overspend. Spend time appreciating what you do have instead of looking online or at stores for what you don’t. It’s a practice that’s perfected over time, but one that can help you stop overspending.