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That one word can reek havoc on your personal finances.
Learning how to stop spending money is necessary. It is critical. It is a must.
But, you just don't know how to stop spending money!
It isn't that you haven't tried! You have many times.
At the start of each month, you are determined to stop the cycle of overspending. You are committed. Yet, halfway through the money the realization sets in that the money you planned to save is out the window. So, instead of trying to reel in the overspending and cut spending additional money cold turkey, you give up and continue on the same spending cycle.
Consequentially at the end of the month, you end back at the same place.
The above example is all too common. If this is you, then you are in the right place. Today, you will learn how to stop spending money.
A classic debt example…
A couple is swaddled with credit card debt to the tune of $50,000. In addition, their home equity loan is reaching the $100,000 mark. They have been transferring the credit card debt to zero interest credit cards to avoid interest and using their home equity to finance their spending. However, each month, their overspending is causing their debt balance to reach new heights. In addition, the zero interest game is coming to an end this month. Assuming they spend all of their income, it will still take at least two years to pay off all of their debt.
The constantly ask themselves how did I get in such a financial hole.
In the above example, this classic couple can learn how to pay off all of their debt. More than likely, debt will creep right back to the same levels because the haven't learned how to stop spending money.
Another reality for many…
A single mom is struggling to make ends meet at the end of each month. She feels constantly pulled in each direction. In order to provide a normal life for her kids, she adds a little bit here and there on her credit cards. Not huge spending – just a little splurge so her kids know they are loved and taken care of. She is too afraid of not providing what she sees their friends getting Eventually, she will figure out to pay down those pesky credit cards and rein in how to stop spending money she doesn't have.
That is the vicious cycle of overspending.
Deep down, there is more going on than what people see on the surface. It is hard to be in a constant cycle of living paycheck to paycheck when you feel like no one gets you.
For too many people, lifestyle creep is hard to resist.
However, today we are going to uncover how to stop spending money. Overcome your money obstacles and live financially free.
Causes of Overspending Money
The bottom line to most causes of overspending is rooted in emotions. In order to stop the reoccurring cycle of overspending, you must uncover the trigger to stop spending money. What is the reason for not saying no to yourself?
1. Overspending Addiction
Spending has become an addiction for you.
You are driven to spend money even when you know you shouldn't or you are completely oblivious to it.
This cause of overspending will take patience and persistence to overcome. Addictions are real and powerful. So, don't underestimate the overspending addiction.
Actionable Tip: Figure out when and where you are most likely to overspend money. Try to avoid those situations at all times. If you can't, then use a cash envelope and fill it with money you can afford to spend.
2. Spending Habits
These are the habit in which you spend your money.
Your spending habits have become so ingrained that you don't even realize it.
Many times they are just part of your routine and it would feel weird to go without it or not do it.
- Daily coffee trip
- Adding items not on your grocery list
- Picking up takeout
- Taking the tollway to save time
- Hitting the mall
- Buying lunch
Actionable Tip: Do a little math. Figure out the cost of your spending habit over the course of the month and then the yearly cost. Decide if you are willing to spend that “chunk” of change (more than likely it may add up to $500-1000+ dollars a year) to continue your spending habit.
Feeling overwhelmed with money is a real situation for too many people.
Why should you stop spending money when there isn't enough anyway!?!?
The vivacious cycle has beat you down to a place where life demands are charging ahead, fires need to be put out at every turn, your to-do list has taken over. You are stressed and overwhelmed.
Don't feel alone. It happens to the best of us. And there is hope.
Actionable Tip: Be kind to yourself. Don't beat yourself up about the current situation you are in. Start with a small money goal to focus on one task. Prove to yourself that you can transform your money.
4. Giving Up
Let's be honest…it is easier to give in and spend money rather than staying strong. And probably more fun, too.
However, that momentary “fun” feeling lasts just for a little bit. Then, the overwhelm becomes deeper than before.
When you give in, you feel like you lost the game. Nobody likes to lose. Especially when you want to win, want to transform your finances, want to have money left over at the end of the month.
Actionable Tip: Journal your feelings when are about ready to give up. Even if you don't like to journal, grab a sticky note and write it down. Then, spend the next couple of days deciding whether giving up is worth it. Give yourself time to reflect and assess if you truly want to give in.
5. Easy Access to Credit
Everywhere you turn there is access to credit. Zero percent interest offers. Free home equity line of credit. Refinance and pull cash out of equity. Lease the dream car for just an easy payment of $297/mo. Invitation to apply for a new credit card. Start a business with an easy to access business loan. Pay day loans. The list can go and on for days.
I swear I cannot make it one day – okay probably not one hour – without receiving an invitation to apply for more credit. And truly, it drives me crazy.
Debt is not okay. It shouldn't be an acceptable practice to be thousands of dollars in debt.
However, our society is happy to ridden in debt. However, it can quickly become very stressful and the feeling like you are drowning in debt.
Plus, when debt is coupled with overspending, it is a slippery slope that may take more effort and persistence to overcome than just to stop spending money you don't have today.
Actionable Tip: Decide that going into further debt isn't an option. Say no to credit offers. Instead, save up money and pay in cash; then, you won't have the same regrets.
6. Saying Yes to Temptation
Your temptation level will be to the level you can bear.
The more often you give in, the easier it is for temptation to win. Once you begin saying no to temptation, than the temptation threshold will rise (as will the bank account).
Peer pressure is the #1 reason we over and over say yes (and agree to things even though we know we shouldn't). We are afraid what others will say if we don't join the happy hour, the shopping spree, or the big vacation. All, we want to do is to fit in with our peers = to not stand out in society. Let alone be an outcast who chooses being frugal.
Giving in to temptation will cause financial ruin if the overspending cycle continues.
Actionable Tip: Where are you most likely to caught up in temptation? If possible, try and avoid those situations or friends. Start off by saying no to one temptation a week.
7. Simplicity of Buying
Online shopping does make life easier. However, it also makes overspending easier, too.
Think about it… if you need to replace something, how likely are you to right now to get in the car, drive to the store, and go pick it up? More than likely, you don't feel like going. But, it is simple to click over to Amazon right now and have it shipped to your house in two days (or even get same day delivery).
Buying is so simple! You don't even have to make a conscious decision to buy!
Retailers are smart. They spend countless hours to make sure your shopping process is simple, so you don't think twice before purchasing.
Actionable Tip: Remove your credit card information from your favorite online shopping places. Then, wait at least 24 hours before buying what you put in your cart. Download our Spending Wish List as a guide. Simple way to stop spending money you don't have.
8. Shopping is Therapy
Oh, have you been caught in this trap of overspending? I know I have many times.
You had a bad day, which was long too, so you stop for a special treat to pick you up.
Someone didn't say the nicest comments about you, so you head to the mall for a new outfit that looks marvelous on you to make you feel better.
While shopping takes away the initial sting, it is just a band-aid.
It doesn't serve as a substitute to helping you work through your emotions in a way that won't be detrimental to your finances and habit over overspending money.
Actionable Tip: Before you resort to shopping as therapy, find another way to work through your emotions. Something you can quickly turn to in a conscious effort to stop this cause of overspending. Some examples include talk a walk, doodle on adult coloring books, clean your house, take your anger out on squeeze balls, write it down, or head to the animal shelter for some doggy love.
9. Your Lifestyle
Specifically keeping up with a lifestyle you can't afford.
This is a huge cause of overspending and a trap many people find themselves in.
We all want the best for ourselves, our families and our kids. So, the trap of overspending money comes easy because you work so hard and want to provide the absolute best for everyone.
However, you can avoid the trap of lifestyle creep and reach financial freedom. That is just a bonus for not overspending money.
Actionable Tip: Ask yourself can I truly afford to keep up my lifestyle? Dig deeper and uncover do you really want to continue living this lifestyle appearance. Or would you be better off to stop overspending money and keep your lifestyle at a manageable level.
10. Spending Money Blindly
This cause for overspending is a bit different. The root cause is not knowing when and where you spend money and if there is money left over at the end of the month.
You just spend money as you go and are unsure of how much money is left over.
Overspending money happens because you don't have spending limits on when to stop.
Typically, if you are caught in this situation, it isn't about needing to stop spending money. It is about needing to learn how to save money first, so you don't overspend money you shouldn't have.
Learn how to sock away extra money into a savings account.
Actionable Tip: Create a budget for the necessities and set money aside in these must needed bank accounts to stop the overspending money blindly. Then, you can determine how much money is left over to spend as you wish.
How to Stop Spending Money Now
Now, that we have uncovered all of the causes for overspending money, it is time to learn how to stop spending money. Above, there are specific and actionable tips for your personal situation.
It is possible to stop spending money you don't have. It just takes a little observance and perseverance to avoid temptation.
Let's dive in…
1. Uncover Overspending Behaviors
The first step to learn how to stop spending money is to uncover your overspending behaviors. While the other tips will help, in the end, this tip will make the biggest difference in how you handle money.
We just covered the top 10 causes of overspending money. But, which one do you relate to the most?
Questions to Ponder:
- What are you tendencies with spending money?
- What is the trigger?
- Where are you most likely to cave into temptation?
- How could you change?
Overspending comes to a screeching halt with a spending freeze. A perfect opportunity to stop all non-essential spending for a set amount of time.
Then, you can uncover your personal overspending behaviors and use the actionable tips from above to overcome them.
2. Track Spending
This one is the hardest for those who hate to figure out where their money went.
If you don't know where your money is going, how will know how much left you have?
Budget Tracker Apps to Make it Easier:
For those who track every single penny, and yet still manage to overspend money, there is a root cause your need to overcome. Until you figure out the behavior causing you to not stop spending money, then the pattern will just repeat over and over.
3. Make A Budget
Many people hate – I mean loathe – the word budget. It makes them cringe inside because deep down there is an underlying problem.
That underlying problem is the case of not knowing how to stop spending money.
Brutal honest truth here…if you want to stop spending money, then you must figure out how to budget money.
A budget (or Cents Plan like we prefer to call it) can transform your current money situation to what you desire in your life.
The power of a budget will help you take off the blinders and help you get on track with your finances.
Success won't happen overnight. There will plenty of two steps forward and five steps back. Followed with three steps forward and two steps back. Over time, you will start making more forward progress towards your money goals.
Thus, meaning you are slowly curing the disease of overspending.
- How to Make a Budget in 7 Simple Steps
- 9 Surprising Advantages of Budgeting your Money
- The Best Methods of Budgeting You Need to Know
- Full List of Budgeting Apps on the Market
- Do You Know the Ideal Household Budget Percentages?
- How to Improve Your Finances with a Bare Bones Budget
4. Use Cash
Cash is king.
Cash is the simplest way to stop overspending.
Yet, society makes it easier to use credit cards and our phones. It seems silly to be old fashion and use cash.
However, when you are out of cash, you can't overspend money.
Unless you decide to run to the ATM or bank to withdraw more money than you planned on. Then, that ruins that awesome budget you just created and you become overwhelmed because you are overspending money again.
So, let's ignore the temptation in italics above and stick with our cash envelopes.
5. Steer Clear from Debt
Let me tell you… Debt is not okay.
Debt is not okay. Period.
Stop listening the to lies about zero percent interest, you will make more money, everyone else did it…the debt lies can go on for pages and pages. Until, you stop and listen that debt is not acceptable if you want to reach financial freedom.
Stop using debt to finance your overspending.
The vivacious cycle will continue until you decide that debt is not an okay option for you.
**Bonus Tip** with Little Notes of Encouragement
My youngest is the best at this in our household. She will leave little notes for everyone just to brighten our days. Those slips of paper will empower me to not give in, do my best, and remember the fun of life.
In order to stop spending money, write little notes of encouragement in those areas you uncovered as spending triggers.
Then, you are leaving behind positive reminders of the wonderful changes you are making. The extra bonus is transforming your personal finances.
Are You Ready to Stop Spending Money You Don't Have?
Truly, are you prepared to stop spending money?
We have uncovered all of the causes of overspending and actionable tips for each. Then, we discussed how to stop spending money. Plenty of awesome ideas just for you.
But, are you ready to take action? Or in this case, not taking action by leaving your credit card and money hidden away?
Overspending can be detrimental to your finances. But, you have the power within you to change your ways and stop spending money.
You have the ability to see things in a different light.
More Resources to Help You:
- How to Make Living on a Budget Painless
- 12 Things I Quit Buying to Save Money
- How to Live Below Your Means and Love Life
- With the Right Money Mindset, Go from Broke to Rich
- Powerful Millionaire Habits that will Change Your Life