How to Stop Overspending in the Wrong Places
The biggest mistake I see people make when it comes to managing their finances is overspending on things you don’t need or things you think you need. Let’s dive into how you can stop overspending and take control of your finances.
Recognize Your overspending
It’s easy to get caught up in what other people spend their money on. But to build your overall financial well-being, start by recognizing if there are any areas you think you’re overspending in. If you’re not sure, pull out your budget to help you get a clear picture of your financial wellness. By acknowledging when you want to spend money, you are well on your way to taking proactive steps to break the cycle and make confident decisions with your money.
Revisit Your Priorities and Financial Goals
Take a step back and reflect on your long-term financial goals. This can help you stay away from the short-term gratification of overspending in areas you don’t need. Looking at your finances from a bird’s-eye view can help you see all of your financial responsibilities and put your spending choices into perspective.
Think Long-Term
To have financial success, adopt a long-term mindset. Even when you plan to make a purchase, think about how it will affect your financial future. Rather than spending $50,000 on a car, think about how that money could contribute to your retirement savings. When you change your perspective on money, you can make smarter decisions with your money that will last you a long longer than the 50k car.
Set a Realistic Budget
A realistic budget that you’re excited about is key in being responsible with your spending. A lot of people think of a budget as restrictive. But I approach it as a tool that can tell you how much opportunity you have to spend in certain areas.
If you need a FREE annual budget worksheet, I created one, just for you.
I always recommend that you should structure your budget to include your essential expenses, savings goals, income, and non-essential spending.
Put Your Money Where it Matters
If you have extra money that you fear you might overspend, consider all of the places you could put that money to help you reach your long-term goals. For example, establishing an emergency fund, paying off debt, or saving for retirement are all wise places where your money can work for you and your family.
Seek Financial Support
Deciding what to do with your finances can be overwhelming. That’s why I’m on a mission to bring free resources, courses, and high-level coaching to move you from feeling overwhelmed to clear, confident, and even excited about your finances.
