How to Avoid Overspending
What is the best way to stay out of debt?
Ensuring you have enough money to make any vital payments every month.
In short, this starts by curbing your spending.
So, here are our ten best tips to keep you from overspending:
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#1 Track your spending
The first step is to be more conscious of where your money goes.
These days, you can find plenty of mobile apps that connect to your bank account and inform you of where your money goes.
It’s a real eye-opener to see how much money you spend on certain things.
Tracking your spending encourages you to spend less on non-essentials, and it also helps you create a budget.
#2 Set monthly goals
One of the best ways to avoid overspending is by saving more money and putting it aside.
To make this more achievable, set monthly targets for yourself.
Select an amount of money that you want to put aside every single month.
Then, be sure you reach this target.
A good idea is to set up a standing order that deposits this amount into a savings account every month.
This guarantees you hit your goals and removes money that you’d otherwise spend on useless things.
#3 Make shopping lists
Lists are useful as they stop you from spending on a whim.
Many of you have the same problem.
You go shopping, and you come home with loads of things you didn’t intend to buy.
Why?
Because you saw them and your brain just decided you needed them.
If you write a list, you have all the items you need right there.
You go to the store and tick off every item on the list.
It stops you from looking at other things and can shorten your shopping trips, curbing your spending.
#4 Take out a set amount of cash every week
This tip is for people who have credit or debit card fever.
In essence, this means you go crazy and use your cards to pay for everything.
It’s so easy to just tap your debit card and make multiple contactless payments every day.
If you take out some cash every week, you’ve basically forced yourself into a budget.
Your cards pay for any bills or direct debits, but the cash is for all your shopping trips.
The aim is to make the cash last for as long as possible.
If you overspend, you won’t have much cash to last the week.
It almost becomes a challenge, which is helpful if you’re guilty of overspending.
#5 Avoid using credit cards
Credit cards cause excessive overspending as you almost become drunk with power.
People forget that the money you spend on your credit card is borrowed.
You have to pay it back, and overspending leads to high credit card bills.
This means you usually make the minimum payment, leading to high-interest rates and a lot of debt.
To stop this, avoid using credit cards.
Either cut yours in half, or keep it out of your wallet.
Our advice is to negotiate a lower credit limit, which means you physically can’t spend much on your card.
Then, set up one direct debit to the card.
In turn, this means you can build credit using your credit card without overspending.
#6 Make it harder to spend money
The internet makes it very easy to spend money.
If you’ve used a website before, it will probably save your card details for you.
This seems handy, but it leads to impulsive spending.
Avoid this by forgetting details on websites.
As such, you have to fill in your card details whenever you want to buy something.
Sounds annoying, right?
That’s the point!
Make it more of a challenge to spend money and you will avoid overspending.
#7 Take time to compare prices
Similarly, always spend time comparing prices whenever you want to buy something.
Again, this stops impulse spending by slowing things down.
Plus, it lets you find the best deals on items you need to buy.
#8 Avoid eating out
Everyone is guilty of eating out now and then.
What you don’t realize is that going out for lunch is very costly.
Even if you go to a store and buy a sandwich, it all adds up.
You can easily rectify this by making your own food at home.
Pack your own lunches for work, make meals, store them in the fridge/freezer, and save so much money.
Make eating out a treat that you do once or twice a month.
#9 Figure out your triggers
What triggers your spending?
Go back through your recent purchases and see when and where you spend most of your money.
Is it when you’re out with friends?
Are you spending too much on coffee?
Figure out your triggers to understand what to avoid.
By being aware of your triggers, you become more conscious of them at all times.
This can stop you from going overboard when you’re put in situations involving your triggers.
#10 Pay your bills first
Bills are essential payments that can’t be missed.
If you overspend, it’s easy to leave yourself with not enough money to cover your bills.
In turn, this leads to debt and extra charges.
So, be sure you pay your bills before spending more money.
The best way to do this is by having two bank accounts.
One is your main account, the other is for bills.
Calculate your bills every month, then deposit the amount of money you need into the second account at the start of each month.
Then, as your bills are due, the money gets taken from that account.
It guarantees that you always pay your bills before spending money on anything else.
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All of these tips will help you avoid overspending and steer clear of debt.
They can also help you save more money to get out of debt.
If you need further advice or guidance, we are more than happy to help.
Call us or fill in an online evaluation form to set up a consultation with debt-relief experts.
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