Can’t stop spending money? Always find yourself trying your level best to save but yet to fail all the same. Being there, tried a lot of things to remove me from money traps. It’s tough but once you practice getting into the habit of saving, I’m sure you’ll stop wasting money all the time.
6 Reasons Of Why You’re Overspending
1. Social Media Trap
Remind me again, how much time do you spend on social media in a day? According to Statista, the average amount of time spent by people per day on social media is 145 minutes. Every company that sells something is on Instagram today because people love Instagram.
If you’re spending 30 minutes as soon as you wake up, 60 minutes during the day and 30 minutes before going to sleep on these social media platforms where after every 3-4 posts, you see an ad, tell me what’s the likelihood you’ll spend more? 1000% chances? Probably.
There are three trigger points on Instagram, understand them and then avoid them. That’s the best strategy I can give you.
- Social Media Ads
After every few posts, after every few stories, you will see an ad on your screen. This is the company trying to sell their product to you. But maybe you don’t get convinced and hence don’t engage, here’s when the next strategy comes in handy.
- Influencer Marketing
I follow quite some influencers on social media and so do you. You already know influencer marketing. I know it’s difficult to unfollow them because it’s fun to see another famous person’s life.
When influencers recommend products people stop thinking and start buying. But let’s say you’re still not convinced. You don’t fall into marketing traps so easily. That’s when the final stage comes in.
- Your Friends
The minute I see my friends wearing Nike shoes, I wish I could buy a new pair right now. Instagram is a fun platform but it is more of a comparison platform. I show off my new shoes to all my followers. They feel jealous and make new more expensive purchases (doesn’t have to be shoes) and show it on social Instagram.
The cycle continues and people buy more and more and more till they are broke. Use social media to connect with people, share photos to laugh and enjoy life not to buy the most expensive things and brag about it.
2. Impulsive Spending (to ease sadness)
Have you tried shopping when you’re sad or depressed? It doesn’t feel great, all it does is empty your pockets. Impulsive spending is dangerous because when we buy things on impulse, we think it will solve our problems but it doesn’t.
You could try sleeping or meditating or exercising when you’re sad or depressed. These work much better than spending on unnecessary items.
3. Using Cards (Instead of Cash)
Have you noticed how easy it is to pay via cards compared to cash? You don’t need to count notes or coins, just give the card and pay the money, easy. Well, then I’m sure you have noticed that you spend more when you have a card compared to when you carry cash. The easier it is to pay, the more people will be willing to pay, it’s quite simple actually.
When you are spending cash, you feel the pain, with every note you pull out of your wallet, you feel the loss of money and kid you not – It Hurts! Next time you shop, don’t make the mistake of preferring a card over cash.
If you haven’t tried cash vs cards theory, go over to the grocery store and buy your monthly groceries using cards. Next time you visit the grocery store for your monthly Someeries uses cash. Go home and compare, I am 100% positive you have spent more the first time i.e with cards.
4. You Hope for a Bonus
You believe that a bonus is nearing. You haven’t received confirmation on the bonus but you hope to get a bonus. Stop this behaviour right now. It’s a different story spending money that you own and it’s a whole different thing spending money you have not received yet.
You might get a bonus, so wait till you get it, then if you wish to spend, that’s fine but don’t spend even before you get that bonus.
Some might spend before getting the bonus they hoped for, then they don’t get it, being angry and upset, they spend more money again. If you are in such a situation, ask yourself this question – Do you want to be financially independent? Because it doesn’t seem like that.
5. You Don’t Know How To Say ‘NO’
Yes Yes Yes Yes, all day every day Yes! Yes is a positive word but that doesn’t mean you say yes to everything. If you don’t learn to say No to store owners when they try to get you to buy their product or upsell you, a lot of money is going to be drained and it won’t be good.
6. Not Budgeting
It doesn’t matter if you earn in 4 or 5 or 6 digits a month, if you don’t budget, don’t expect to save money and reduce spending on unnecessary things. Tracking your expenses is rule No 1 and the easiest way to track is by budgeting.
If you don’t know how to budget, go to point 7 of ways to stop spending money where I’ve explained in detail how to create an easy budget that anyone can follow.
Well, there you go – 6 reasons are why you can’t stop overspending. I didn’t create these seven pointers so you hate yourself to the core. All I’m trying to do is help you understand why you’re spending money on unnecessary things, things that you think may bring you happiness in life but in reality, they dig deeper pockets.
24 Ways To Stop Spending Money
1. Take an Oath to Never Touch Debt
Who’s not your friend??? It’s Debt! Who’s the guy you need to run from during the good and bad times? It’s Debt! Who’s the one that always shows hope but empties your pockets at the same time? Yes, It’s Debt. If you’re serious about reducing your spending habits, you’ve got to avoid debt.
Every financial problem you have can be solved with debt, that’s why so many people take on debt. It’s a great feeling to get rid of all your problems. What most people don’t understand is that the problems haven’t disappeared, they have just been delayed.
Debt is only good if you have a lot of money in your bank accounts and still think of using debt. Delay the house purchase for a few years, accumulate cash in those years then come back and buy your dream house. The same goes for a car or anything else.
Save money, avoid debt and be happy. If you currently have debt, here’s an article that might help you; 9 Things to avoid when you’re in Debt.
2. Stop Spending Money At Restaurants
Want to stop spending money on food? Learn to cook, it’s that simple. Reducing the money you spend on food is the easiest way to save money.
By learning to cook like a cook, you’re staying away from those fancy expensive restaurants because you can cook like them at home with ease.
But cooking isn’t all that easy, am I right? Well, that’s where The $5 Meal Plan comes to the rescue. Did you know that the average family spends more than two hours a week just to plan their meals? I’m sure your time is precious and you’d not waste it thinking of what to cook.
The additional two hours a week will give you time to work on your side hustles, spend time with your loved ones and binge Netflix. The $5 Meal Plan is simply, for just $5 a month, you’ll get a grocery list and meal plans sent to you each week. These meals are customizable and each meal costs less than $2 per person, Not Joking! They do offer a 14-day trial, I don’t think it’s necessary but they offer a free trial so that their customers love them!
If you’re interested, you can get a 14-Day FREE Trial Of The $5 Meal Plan.
3. Always Wear Earphones
Listening to music all the time is a trend anyway, so why not take advantage of it to stop spending money! Listening to music can keep you distracted from all the noise and ads in your surroundings (works best in shopping malls). So you don’t end up hearing offers, thus spending less.
Another advantage of wearing earphones is that when you see an exciting offer, your heart says to take it but you listen to your logical mind and say no to it, you won’t feel bad because you’re listening to your favourite songs.
It will take you a couple of seconds to forget the offer and enjoy the song but It will come. Wearing earphones while shopping is pro Shopping tip 101. Don’t forget to try it
4. Rethink. Relocate. Resist
If your expenses are through the roof, it might be because of your locality. The quickest way to solve that problem is relocating. But do you need to relocate? To answer that you have to find out two things:
- Your Rent – Paying any more than ⅓ of your income on rent is way too much. ¼ of your income or even ⅓ of your income is fine, anything more than that is luxurious living.
- The average salary people in your locality make and compare it with your salary. If there’s a huge gap (your salary is lower than the average salary), the best choice is to relocate somewhere else where the cost of living isn’t exorbitantly high.
Many people move out of New York because the cost of living in New York is extremely high. If your salary is equal to the average salary, I would recommend at least thinking about relocating. This way you’ll reduce your expenses, thus saving more and spending less on the same items.
5. Create an Easy To Understand Budget
If you’re new to budgeting, you’re probably not going to like it. No one likes new work, in the beginning, that’s why you need to ensure the budgeting plan you create is super simple, easy to understand the plan that takes very little time to create and maintain each month.
Ground Rule – Your income needs to always be more than your expenses, no matter what.
That’s where my budgeting template comes in handy. Did you know I have two budgeting templates that are for FREE? One is based on the 50-30-20 rule of budgeting and the other one is a detailed budgeting template.
If you’re a beginner, I think you should grab my 50/30/20 Budget Planner. It’s FREE, it’s effective and it’s simple enough to understand.
If you have some experience in budgeting and would like to dig down deep into your expenses, my detailed budget template will surely make your life a whole lot easier. Here you go! You’re welcome.
Your budget needs to cover these aspects in detail:
- Your needs
- Your wants
- Your long term goals (new house, car, child expenses
- Your debts
- Your savings (emergency fund, retirement accounts, investments)
By having these checkpoints in place, you can make a budget logical and practical and suited to your needs only.
6. Write Down 3 Financial Goals
Have you listed your financial goals yet? Whether you want to save money to buy a new house or pay off student loans or build your retirement account, preparing financial goals is an easy and fun price I’m sure you will enjoy.
Just take a pen & paper and write all the things you want in the next 5 years or 10 years. You don’t need to make an extremely complex plan, a simple goals list compiling your top 3/5 goals you want to achieve in 5/7/10 years along with a simple plan to get there. Let’s say your financial goal is to build a small house in the middle of a forest for your retirement days.
You’re 30 years old now and you want to retire at 50, so you have 20 years in hand. You need X amount to build a house in the forest. So divide X by 20 (X/20), which will give you an estimate of yearly savings for the house.
Add 10% to the X as the price of building a house will increase in 20 years and also because you may need more money and there you go! A simple plan to achieve your financial goal.
7. Identify Where Your Money Goes
How much did you spend on transportation last month? How much of it was on rent? Groceries? Diners? And all the other expenses? If you don’t know where your money goes each month, you won’t be able to make changes in it and save money.
Budgeting helps to solve this problem. What do you usually spend on and how much do you spend on it? You better have answers to these questions as they make or break a good spending habit.
8. Master Spidey Skills (Spider-Sense)
Spending money and saving money boils down to this one aspect of your life – Awareness. If you are aware when you make a purchase, if you have a strong spidey sense, you will stop spending money for good.
We often know when we are purchasing a product but we think less and act more (by making a purchase). By being aware and focusing on if you really need the product, most of your shopping will be stopped.
When I am in the shopping mall, I tend to like something, I check its price and If it seems reasonable, I’ll head over to make the purchase, here’s where awareness pop’s in. Right before I’m about to make a purchase, I need to wake up my awareness and think – Do I really need this? Sometimes you do, in such cases make the purchase.
9. Focus on Things You Need (Truly Need)
A few years ago, I didn’t know the difference between needs and wants. I used to spend when I like what I like (usually street food). After reading many financial books and understanding money on a much deeper level, I can positively tell you that understanding the difference between needs and wants is the most important aspect of money management.
A need for one person may be a want for another, you don’t need to identify what your needs are and what your wants are. . I am not against spending on wants, my biggest splurge is on burgers and sandwiches every week but I budget so lowed to spend a certain amount each week on outside food
10. Stop Impressing Your Friends
Stop spending money to impress your friends. It’s lame, definitely not budget-friendly and it’s a never-ending cycle, which means your friends are never going to get impressed so you’ll never stop spending money on expensive unnecessary things.
Do you want to get broke or live paycheck to paycheck only because you want to look cool in front of Matt and Alisha?
Instead of spending money to impress your friends, I would recommend you to spend some money on Tony Robbins New Course – Ultimate Edge. I’m sure you have heard of Tony Robbins, he is an author, speaker, finance and personal development coach.
You need to take up this course if you need a whole self-improvement check-up. The course is aimed at helping you overcome your obstacles, managing your finances to take charge of your life. If you’re in the struggling phase right now, the Tony Robbins course can be your medicine.
You can check out his course here – Tony Robbins Ultimate Edge.
11. Shop With a List
Grocery shopping is like entering a gold mine, you can buy as many items as you want because all of these things are amazing. I’m sure you would want to grab the entire shop but it costs money.
We people can easily get lost in between countless delicious food brands that sound unbelievably mouth-watering. Most people who live paycheck to paycheck or those people who find it hard to save money are either spending way too much on groceries or restaurants, it’s usually one of the two.
I’ll give you two tips to break out of this money mess:
- Walk it out
You’re in the food aisle, ready to make a move on those sauces and herbs, you probably have 4 sauces and a few herbs but you crave for more. In such cases, before you become a victim, take a walk. Walk as fast as you can away from those herbs and sauces. While you’re walking think about the items and ask yourself these two questions:
- Do I Need Them?
- Will I use these after 6 months?
- Shop with a list
Hands out the best way to shop on a budget, make a list. Before you head over to the grocery store, take a piece of paper and write down whatever you need, add some want based items and then head over.
Our goal is to stop spending money and being frugal but if you seriously want those delicious sauces and herbs, if your budget has some room for flexibility, you should buy them.
If the item is expensive, buy it after a week or a month, save for it and then spend your money.
If you want some more amazing grocery saving hacks, check out my article on the 29 ways to save money on groceries.
12. Run Away from Discount Brochures
Store owners use the greatest technique of all time to make people buy more, they use discounts. Who doesn’t love discounts! Discounts are a great way to increase the purchasing power of customers.
Everyone loves to buy things in bulk quantities during discounts. The higher the discounts, the better. To be honest, getting your eyes off discounts is going to be tricky. I mean you could buy the same product for 40% off its normal price.
But here’s what you’ve got to do; ignore the discounted price, think of whether you would buy the product if there was no discount on the product. If you have been longing to buy something but the normal price was just too expensive for you, and now they have a huge 3-day sale, go for it! But if you don’t think you’ll ever use an item, then don’t make a purchase. You simply can’t waste money.
13. Start a ‘No Spend Challenge’
A very trendy concept now is the ‘No Spend Challenge’. If this is the first time you’re hearing about this, it says that for 30 days, you don’t spend money on anything (absolutely nothing) that is considered as WANTS. You only spend on basic NEEDS to live life.
After 30 days, if you feel like spending on certain wants, that’s fine but for those 30 days, you better not spend anything on WANTS.
14. Consider Being a Minimalist
When anyone says Minimalist, the only person I think of is Matt D’avella. He has a youtube channel where he talks about minimalism and productivity, and yea he is a MINIMALIST. Here’s how you can be a minimalist.
Start by decluttering and throwing away things you rarely use or never use. If you do this properly, you’ll find a lot of wasteful things in your house. Being a minimalist teaches you the concept of living with a few things that make an impact in your life, like your phone, your laptop, basic clothes, etc.
You realise the value of money and you cherish it more than ever. In case you’re wondering, I am not a minimalist yet but I am slowly approaching my way towards being a minimalist. I hope you’ll join me on this journey!
15. Increase Your Income Not Your Wants
Instead of spending less, why don’t you make more money? By increasing your income, you have more room to spend money, save money and invest money. Focus on spending less but equally focus on making more income.
You could start a side hustle or take up a part-time job or start a new business. The bottom line, you can’t depend on your current income. You need to branch out and make more money.
Doing that will give you the wiggle room you need to spend more on wants like more dinners at restaurants, many more movie nights and vacations.
Bonus Tip: Compare Your Wants
Comparing your wants is a smart way to reduce spending. It works every time. When you feel like buying something, let’s say, Product X, you need to think of something that can bring you more satisfaction than Product X.
Here’s the catch – whatever you choose has to be cheaper than Product X (at least 30% cheaper). By doing this, you are:
- Forcing your brain to think of creative ways to spend money
- You are spending less
- You are getting greater satisfaction
- You may not spend on anything at all
Let me explain the 4th point. So when you compare Product X and its price to find something better, you’re exploring more options, doing this may help you understand the importance of money.
You’ll not only trash away from the plan to buy Product X but you’ll also not spend on anything else (because you realise the value of money). This doesn’t always apply to everything you buy but the more you practice comparing your wants, the higher are your chances to understand the value of your money.
How to Stop Spending Money on Clothes
1. Delete All Shopping Apps
If you browse through all the emails and app notifications shopping companies send you and you’re still not broke – you represent the top 5% of the world (maybe less).
Online e-commerce companies are very good at what they do and their purpose is to sell products like crazy, you’re the tool they use to drive up sales and the way they contact you is through social media, emails and app notification.
You know what to do right? Unfollow them on social, unsubscribe from their email list and delete the app. That’s all you need to do to avoid impulsive buying.
2. Organise Your Closet
You already have a bunch of clothes you don’t wear. So let’s take some time and organise our closet in two simple steps.
Step 1: Empty your Closet
Everything needs to get out of that shelf. Display all your clothes in the open so you can have a good look at them.
Step 2: Try Out Each Combination
These two steps may take you a day (depending on your closet size) but it’s necessary. You need to try every possible combination with the available clothes in your closet. If there are 2 shirts and 2 pairs of jeans, then you have four combinations to try. Once you do that, you’ll see the possible outfits you can wear.
Before I tried this, I used to think I didn’t have many clothes because I used to wear the same 3 t-shirts and 2 shirts along with 3 pairs of jeans 7 days a week. So I picked a Sunday, took out everything I have and tried all the combinations. I lost count after 21 combinations, I had so many!
Doing this will also improve your style game and of course, it will save you money. If there are clothes that don’t fit properly, give them to charity or your siblings or your friends. At the end of this, you should have new combinations to wear to your work or college every day and not spend money on clothes.
3. Wash Your Clothes Properly
All clothes were not created equal. So using the same procedure to wash all your clothes is certainly not the best approach, especially if you want to use these clothes for a long time.
I use the washing machine to wash my clothes but some clothes when put on the machine get all messy and old. I’m sure you have seen this happening with a few of your clothes.
So read the label to figure out the best way to wash your clothes, follow it and you’ll not spoil the quality of the product in a single wash. Once I learned this concept, I saved my time (by not rewashing it or returning it) and my money.
Another tip I have for you is to not wash your clothes that often (especially jeans). I am not suggesting you wear stinky clothes (please don’t do that), I am only suggesting you should wash it when it’s dirty and stinky or when you feel you need to wash it.
How To Stop Spending Money On Unnecessary Things
To get over wasting money, you need to learn to stop spending money on unnecessary things.
For that being Aware is Rule #1. If you know when you fall into the money trap, you’ll be able to get yourself out of it fast and save yourself from spending on irrelevant things.
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