It’s tempting to splurge and keep living large, but everyone should save and invest some of her funds for the future. Do you often find yourself stressed out about money? Do you see yourself spending too much money? You don’t want to get into being financially stressed out, as it can really weigh you down. Always ask your self am I spending too much money?
Spending too much money unnecessarily is something that you should be worried about.
You will be left with nothing for savings when you spend too much money, so know-how and what to spend on should concern you. One of the main concerns is the inability to cover an emergency or unexpected expense. Of course, some aren't making enough money. And others who live above their means, even if they don't realize it.
Whether you have enough money or not, to live a comfortable life is to know how to spend it. You need to know if you are overspending and how to control and manage your finances. These signs will let you know if you’re spending too much money so you can take a deep look at your expenses.
Use The Information Below To Help You Determine if You Are Spending Too Much Money.
You Don’t Have Any Savings
You go to work all the time and get a paycheck, or you are a business person, but you don’t have any savings; it’s a sign that you might be spending too much.
Some people have no emergency funds, barely any savings, and if it wasn't, because your employer automated payments into your pension fund. You wouldn’t have anything save towards pension either. When there is nothing left on your account as savings by the end of each paycheck, it means that you are not saving for the rainy days.
Open a savings account and put a little amount into it on every paycheck. It might look small to you, but I bit you as time goes on, you will appreciate it. Don't live paycheck to paycheck.
Start investing small amounts of money, even spare change, with Acorns.
You Don’t Know Your Account Balance
You won’t know the balance in your bank account if you’re always spending money on something. You might also be living in denial about how much you really have. Always ensure you check your account balance once in a while to know how much you have. Some people are even scared of checking their account balance as they don't want to know how much is left.
Not checking your account balance will do you more harm than good. For example, If you have $300 in your account and swipe your card three to four times, you should check how much is left even though you feel you know.
If you check and found out you only have $50 left, at that point, you can decide to stop shopping until you get another cash or until payday. Not checking your account regularly will not help you; rather, checking it will limit your spending.
You Are Always Giving Yourself a Treat
Self-care is awesome, but giving yourself a treat every other day is a sign that you’re overspending, plain, and simple. It sucks missing out on fun adventures with your friends and family but don't overdo it. A fun treat now and then is fine. But if you’re guilty of impulse shopping, it’s time to clamp down. Shopping sprees can quickly spiral out of control. Before you know it, you’ve blown through whatever money you had for bills and other necessities.
As you build your budget, be sure to include a little fun money each month. Otherwise, stick to your budget. If you find that you are frequently spending too much and you can’t seem to control it, take the steps now to determine if you need help for a shopping addiction.
You Buy Things You Don’t Need
When you find that your home is filled with stuff you don’t need and will not use, it's a clear sign that you need to stop overspending.
Just because a product is on a discount shouldn't mean that you need to buy more of that. If this is a need and you use it constantly, then stacking up is a good way to go. But if you buy more than what you need, then it means that you are overspending.
Some people think that because something is on sale, then they need to buy more. The reality is, if the product is on sale, there's a high possibility that the product will go on sale again in the future. The key takeaway here is to buy what you need.
Don't go overboard, and don't go underboard either. You will be alright when you are spending money on things you need. In short, buy what is you need, and you will be alright.
You Don’t Know How Much You Spend Every Month
If you can't track where your money goes every month, you will probably be going overboard with spending. Watching the way you spend your money is a good way to keep track of your finances. A good way to start is by writing everything down and stick to your budget every month.
The envelope method is an effective and easy way to stick to your prepared budget strictly. Put the money in an envelope and keep it aside and only open the envelope when you need it. There is no time like the present; try tracking your money today. Eventually, look back at old bank statements at least 4-6 months to date and then identify where your money is going.
When you can locate where your money is going, you can start finding ways to cut back on purchases and save money. Ashley Feinstein, the founder of Knowing Your Worth, said, “I recommend that every client keep a money journal for at least a couple of weeks to get conscious about where their money is going.”
Sometimes, the reasons that people spend too much money cannot be easily determined and some reasons are just too obvious. The best thing to do is to stop asking yourself some questions: Do I really need this? What do I need it for?
While spending money may bring you happiness, it's important to budget your finances so you can have some savings for the future. While there are plenty of ways to spend your money, it doesn't necessarily mean you should. Only spend money when it's necessary, not because others are doing so.
It’s never bad to look at your spending habits and patterns because those will tell you where and if you are going over what you can afford. Remember any financial mistakes, even small, when left unchecked and corrected, can damage your life and future. Look for the things you spend too much money on and eliminate them. Always stick to a budget and never renege on it, stop spending once you go above your budget.
Michael launched Wealth of Geeks to make personal finance fun. He has worked in personal finance for over 20 years, helping families reduce taxes, increase their income, and save for retirement. Michael is passionate about personal finance, side hustles, and all things geeky.