Talk to our finance specialists today 1300 257 426

Reasons why people tend to overspend

By: Louise Mosqueda0 comments

There’s something therapeutic about being able to buy that cool pair of shoes on sale. You don’t even need the shoes. You just like how it looks and the fact that it was 50% off sealed the deal. Within the next few minutes, you’re walking out of the shopping centre sporting your new kicks, assuming you saved half of the price.

In reality, you just spent money on something you didn’t need. You do this enough times and you overspend your budget for the week, making it harder for you to pay for your car finance and other bills.

Tendency to overspend

Shopping gives us a feeling of accomplishment. Initially, you feel victorious in scoring a discounted item, but then it becomes dreadful the moment you realise you don’t actually need it. You then swear to yourself that you wouldn’t fall for it again until you see something else at the store that you “must have”.

There’s nothing wrong with a quick purchase once in a while, however, doing it all the time and continuing to overspend your money is what makes it a problem. That’s why it’s crucial for you to rely on something other than retail therapy to get you through the rough patches you face in life.

To effectively avoid overspending on unnecessary items, you must first understand why someone does it. Learning the underlying reasons will allow you to circumnavigate and prevent the events and emotions that trigger your need to overspend. To give you a better idea, here are some of the most common reasons people tend to overspend:

Bad moods

Many people use shopping as a way to make themselves feel better. It might work for a while, but then it wears off, and you realise how much you owe on your credit card. The stress is enough to make you go shopping once again, digging you deeper into the hole that you’re already in.

It’s better for your mind and your wallet to find a different way to deal with negative emotions. Choose to do something other than shopping, like going for a run or lift some weights at the gym. These activities help your body release endorphins and lift your mood altogether. You’ll sense a similar satisfaction with shopping except that it’s calories that you burn instead of money.

You’re on holiday

Various places offer different things. So, it’s no wonder people get excited and buy everything and anything that catches their eye.

Buying all of those souvenirs now may be fun, but once you get home and realise how much you brought back and spent, the remorse will be enough to make you want to go back and return everything you bought. Luckily, you can easily control your spending habits when you’re on holiday. 

The best way to counteract this is only to use cash when shopping. This will enable you to control your spending effectively, so you don’t have to deal with extra charges to your credit card.

“It’s on sale!”

A sale is great for when you need to buy something because you can get it at half the price. However, the problem is that some people see a sale and immediately buy the item without much thought. This eventually leads to spending more than intended.

Stay away from stores and websites offering deals on items. If you are going out, try not to bring too much extra cash or leave your cards behind to help deter you from buying anything. There are plenty of other ways to avoid impulsive buying that you can try for yourself.

Finding out the reason behind your overspending is the first step to overcoming it. Practice sound money habits, and you will be handling your money well over time and overspending will be a thing of the past.

Related post

Leave A Comment

shares