Lifestyle

8 Finance Hacks for the Chronic Overspender

Every time you leave the house, you’re faced with advertising campaigns trying to convince you to spend your money. It’s hard to consider what you do have when the world wants you to think about what you could have. Sadly, this is dangerous for people who have trouble keeping their money and can lead to severe financial problems. If you consider yourself a chronic overspender, you’re not alone — fortunately, there are ways to improve.

1. Keep Track of Your Payment Cards

First and foremost, you should default to using your debit card for any purchase. The money you spend this way is coming straight from your account rather than using credit. Spending credit means that it’s not your money — it belongs to the bank or credit card company. It’s harder to monitor your activity without seeing it leave your account in real time.

Due to the way that credit scoring works, credit cards are beneficial if you spend 30% or less of your limit. Therefore, you don’t have to use your debit card all the time, but should use credit responsibly.

2. Budget Before You Spend

This sounds intimidating, but it isn’t once you understand how it applies to you. Create a budget for each month to ensure where your money goes. Put aside however much will go to bills, so it’s accounted for, and budget for other necessities like savings.

Budgeting can be a great way to give yourself leeway for certain impulse buys. You can create a category for fun expenses that fit your financial plan. Additionally, once everything is accounted for, you may be able to find areas to modify. If you plan for an impulse buy, it’s no longer purchased on impulse.

3. Get Ahead of Your Impulses

Nobody knows what catches your eye quite like you do, which means you’re capable of preparing for your response. Do your best to give yourself access to alternatives when confronted with a potential impulse purchase. For example, if you have a sweet tooth, carry around some sweets to eat while passing a tempting bakery.

An additional way to prepare would be by keeping a list of things you need or want, so you can research and allocate funds over time to purchase them responsibly without overspending. Budgeting, as previously discussed, allows you to give yourself an amount to spend in advance.

4. Learn How to Get Your Money’s Worth

When you’re trying to lower your spending without making too many life changes, there are a few factors to consider. Take into account the cost, quality, and usage of each item you purchase. Lower cost items are usually lower quality but have quick turnover. In contrast, higher-quality goods will cost you more but should last longer and be more efficient.

When considering clothing as an example, this is calculated as cost per wear. If you buy a cheap shirt for $10 but only wear it twice, that costs you $5 each time you wear it. However, if you buy a more expensive shirt for $50 and wear it 20 times, that’s only $2.50 per wear. With this in mind, investing in higher-quality staples can save money over time.

5. Take Care of Your Purchases

No matter what you end up buying, you can extend its life by taking proper care of it. All types of produce, like herbs and vegetables, for example, have specific storage techniques to maximize their shelf life. Once you get in the groove of using these techniques, they quickly become second nature.

You can also teach yourself DIY skills, like sewing and basic home care, to mend deteriorated possessions and clothes. Even just learning how to properly clean appliances, electronics, or other home goods can keep them like-new for years.

6. Upcycle Old Items for New Uses

Once items do finally break down, you can use your skills to turn them into something new. Old drinking glasses can become small flower pots or curtains can become a new dress. If you’re really handy, you can even take apart your old furniture and build something better.

It’s not unrealistic to make such projects work, and they’ll save you a ton of money in the long run. All you realistically need to learn these skills are some tools, online video guides, and motivation.

7. Be Aware of How Much Cash You Have

It’s easier to thoughtlessly drop more money with an abundance of cash in hand. Cash has no automatic paper trail for you to monitor, so it feels less detrimental to spend. A debit card is still your money, but you can track the total amount in your accounts at all times on your phone.

There are moments when cash is necessary, such as emergencies, yard sales, or donation opportunities. In these cases, you could choose to track your cash spending if you include a section for it in your budget. All that matters is that you’re conscious of the amount you spend and don’t carry around more than is safe to drop.

8. Build a Realistic Financial Mindset

Your ultimate goal is to develop a healthier and more realistic mindset regarding your finances. Remember that businesses are designed to catch your attention and get you to buy things. Instead of browsing and thinking about what you can buy, focus on what you need. This is an important step toward preventing unhealthy impulse purchases.

There is always a way to cut your spending. As hard as it feels, make sure to put the most effort into your mindset. From there you’ll be able to draw the energy to put more of these ideas into action. In the end, you might be surprised by how good your bank account looks.

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