To stop overspending, we need to look at why…
The three most common reasons people overspend include:
- Consumerism — How much stuff is enough?
Advertising sends the message that in order to be sexy or desirable you must look a certain way… buy certain clothes, makeup and get cosmetic procedures. There is the message that we need "more" to be happier. We need bigger houses, nicer cars, more gadgets. But buying into this messaging can easily lead to excessive credit card debt. It can even lead to higher student loan amounts if you take out extra loans to fund these "wants." Before you find yourself in a mountain of stuff (that doesn't make you happy) and bills (you can't afford), consider your financial priorities.
- Poor planning — Are you checking with your budget?
Many people know what they would like to purchase — but they don't check to see if it fits in their plan or budget.
- Compulsive Spending — Is your spending an addiction?
People joke about "shopaholics," but true compulsive spending is a serious disease. While it is often a problem associated with women, there are no gender barriers to the condition. Look for warning signs:
- Are you buying things you never end up using?
- Do you spend more time trolling for deals than doing your homework or hanging out with friends?
- Are your credit cards at their limits?
If any of these habits sound like you, you may have a shopping addiction.
Think about why you shop. Are you bored? Do you shop to relieve stress? Once you know your triggers, you may be able to stop some of your destructive behaviors.