Being able to purchase what you want whenever you want, is a level of financial freedom everybody desires, but the truth is, not everyone will attain this. If you are in the category of people who write a long list of wants versus needs before going to shop, overspending should never be a habit that you pick up at all, because you are just one or two items away from being broke. Rich people also overspend, sometimes leading them into financial distress. Overspending is a bad financial habit that no one should have. If you’re concerned that you might be an overspender, here are some signs to watch out for:
You frequently spend more than you earn: If you consistently find yourself with loans that are higher than your income, it’s a clear sign of overspending.
You don’t have a budget: “As the spirit leads” gang, come over here real quick. This one’s for you. Without a budget, it’s challenging to track your spending and prioritise your expenses. Overspenders often lack a clear financial plan.
Compulsive shopping: Engaging in shopping binges or feeling a compulsive need to buy items is a sign of overspending.
Ignoring price tags and sales: If you don’t pay attention to the cost of items or ignore opportunities to save money, it can indicate overspending.
Impulse buying: Making unplanned purchases on a regular basis, especially for items you don’t need, is a sign of overspending.
Ignoring bills or payments: If you frequently miss or forget to pay bills because you’ve spent money elsewhere, it’s a warning sign.
Lack of savings: Failing to save for emergencies, retirement, or other financial goals is a sign that you may be overspending.
Justifying unnecessary purchases: You find yourself coming up with excuses or justifications for buying things you don’t need.
Ignoring financial goals: Overspenders often neglect their long-term financial goals in favour of immediate gratification.
Hiding purchases or financial problems: You avoid discussing your finances or hide your spending habits from others, including loved ones.
Frequent loans from friends or family: If you regularly need to borrow money from loved ones to cover your expenses, it could be due to overspending.
HOW TO OVERCOME OVERSPENDING
The solution to overcoming overspending is basically doing the opposite of all the things highlighted above, but I would just point out four that stand out.
Create a budget: Having a budget will help you make a clear distinction between what you want and what you need. It helps you put your spending in check because it will set a limit for you and sticking to the budget will ensure you do not go beyond that limit. Having a budget makes tracking your spending easy because you already know where your money is supposed to go.
Set financial goals: Goals keep you focused. It could be rent, a new car or an education. Putting a time frame to when you want to achieve your goal will make you more driven and disciplined.
Start saving: Put a certain percentage of your income away in a savings account first before doing any other expenses. This way, you will be sure not to erode the money you wish to save. You can even set a standing order on your account, which will enable the system to deduct the amount automatically. You just might be lucky when there is a savings promo going on and you could go on to win a huge amount of money just because you saved. Check out the Super Savers Draw page to see how saving as little as N5k can make you a millionaire.
The UBA mobile app has all these features that can help you overcome your overspending. Just download from the App Store or Play Store to get started.
Financial counselling: It is okay to seek professional help if you are finding it hard to overcome your overspending on your own. Look out for programmes that discuss how to attain financial freedom, attend them and practise what you learn. The UBA Business Series is one of such programmes. The programme ensures that you get highly beneficial financial advice from industry experts.
The road to financial freedom is not an easy one. It takes a whole lot of discipline and determination. So start managing your spending in order to improve your financial well-being.
Read Also: 4 Ways to Stay Out of Debt
