High Debt Amounts – How To Control Overspending

When it comes to money, people often have different spending habits but ultimately at some point in their life end up overspending. Unless you are in the minority and have bags full of cash in reserve, the regular joe’s of this world will undoubtedly have at some point spent more than they can realistically afford. This may be down to using impulse purchasing, being hit with unexpected bills or simply poor money management. To resolve this, money is borrowed from banks or loan institutions and this debts are aquired.

Borrowing money isn’t always a bad thing, it can be useful and sometimes a necessity. For example, borrowing money for a car to get to work or money to start a new business is a useful form of borrowing as it is money that has a purpose to help get through day to day living and possibly improve your social standing in the long term. Then there is borrowing money for something we don’t actually need which can be classed as bad debt. Borrowing money to go out and entertainment or money used for a holiday would be classed as a bad debt as it is money for a short term enjoyment and wouldn’t benefit you in the long run.
But due to some factors, some people have been having financial problems due to overspending and high debt and some has resulted to lose everything that they have because those were taken as payments for their debt. Some even find themselves having bigger financial problems because of the inability to pay back their debt. There’s nothing wrong when you buy something that you like, but whenever you purchase something expensive, buy it in expense that it’s really needed. Without proper money management, it could give you huge financial problems in the future which might make you lose everything you’ve spent your hard-earned money for.

How to avoid overspending and high debt?

Save up. The proper way to save your money is not saving of what is left from your money. The proper act of saving is that you treat it as a part of your budget routine. Instead of saving from what’s left of your salary, stash off an amount as savings and stash another part for necessities. That way you can ensure yourself that you get to get your necessities and you get to save for the future.

Prioritize your bills. A good way to pay off your debts and bills is that you put a bigger part in paying off the one with the highest balance and pay off in small amounts on the ones with lesser balance. That way you can save much and ease yourself from frustration because the bigger debts are paid off.

If you don’t need it, then don’t buy it. You see a new phone with more powerful features than the one you have. Who doesn’t want cool techie stuff? But before you pick out your card and swipe it in, you have to ask yourself whether you really need it or not.

Buy things that are on your list. It is a good money practice to list things that you really need that suits your budget very well. When you list something, you have to stick it so you can avoid overspending.

Don’t go to stores too much. Sometimes to make you avoid buying things that are unnecessary is to avoid going to stores too. It is because when you frequently go and in out of stores you are tempted to buy new clothes or new gadgets. Go only on stores that sell only you necessities like grocery stores.

When it’s sale, it doesn’t mean that it’s a good deal. Stores have their way on making their customers take out their wallets and buy their products; it’s the on sale move. We have to be careful on this one though. There are items that are on sale but the price is still the price that you can’t afford. Even though it’s a sale item, if you can’t afford and you don’t really need it, you don’t have to buy it.

Find ways to reward yourself without spending too much. Eating out is nice, sipping your favorite coffee at a coffee shop, or even buying yourself a new pair of shoes as reward. It’s not bad to reward yourself, but if you make the rewarding part as an excuse to overspend then it’s not good either. Feeling like you like to reward yourself with a delicious meal? Why not you buy the ingredients and cook it yourself? It could save you more than having it at expensive restaurants.

Proper money management might not be easy but dedicating yourself to follow these simple tips plus discipline, you’ll get to free yourself from huge debts and overspending. It would also help you have a good credit record which would be very helpful to you when you apply loans on banks for future financial goals like a car, or your very own home.

Andy Gorton is the author and editor of the Bankruptcy Clinic

Andy Gorton – who has written posts on Bankruptcy Clinic Blog.

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