Money comes in, and money goes out. But many of us have a tough time figuring out where all our hard-earned income goes. Learning how to manage money is not something we learn in school. However, the good news is that it’s never too late to educate yourself on healthy spending habits. Let’s get started!
Tips to Stop Overspending
Often it is impossible to increase your income in the short term, but you can get a better grip on your expenses. Good money management will not only help you figure out where all your cash is going but also assist you in saving for a home, car, or other big expense. Some tips to stop overspending are:
Create and Stick to a Budget
The best way to gain control over your finances is to put down on paper (or a spreadsheet) where all your money goes. Create a detailed budget that has income and every single expense. You may need to collect some documents before starting. Your W2s or pay stubs will help with income figures. Then collect all your bills, credit card, and bank statements and estimate what your expenses will be each month.
As the months pass, update your budget, and you will start to identify where the money goes. Perhaps you are eating out more than you thought. Sometimes it can be as simple as picking up an expensive latte each morning. A budget is essential to help you see where your money is going so you can stop overspending.
Review Credit Card Purchases
Often people buy impulse items on a credit card. So, you may not even realize how much debt you have amassed in a short time. Pay off all your credit cards
, so you aren’t paying interest which adds to your monthly expenses. Take note of things you are purchasing and areas where you can cut down.
Some things that people overspend on are entertainment (movies, rentals, shows) and eating out. Start cooking at home more, and you won’t believe the savings.
Whittle Down Your Expenses
Most of us pay for tons of things we don’t even use. The average American signs up for multiple streaming services like Netflix, Amazon, Hulu, Apple TV+, and more. If you want to cut down on expenses, lose a few of these services, which you probably aren’t even watching on a regular basis.
You may be able to cut down on other expenses, too, like your phone or internet plan. For example, consider switching to a new carrier
that offers lower monthly fees or a new free device for switching.
Other areas where you may be able to reduce your expenses are utilities (shop around), insurance, and even credit cards. You might be paying a high interest rate and don’t have to. Consider a debt consolidation loan to help ease the monthly interest charges if you have a lot of debt.
Cancel Subscriptions and Memberships
If you are like many people, you probably have a gym membership you don’t use. You might have also signed up online for a monthly subscription and then forgotten about it. All of these items add up to wasted money out the window each month. Check your bank statements and credit cards to find these pesky charges and cancel the accounts.
Other Tips for Saving Money
Before buying a new laptop
, tablet, or TV, give yourself 24 hours to think about it. Just waiting for one day might calm your head and help you make a good financial decision. A lot of overspending is linked to emotion and impulse buys. Involve a friend or partner, so you have someone you need to be accountable to. It will help you stay on track.
How an Extended Warranty Can Help
You may wonder how an extended warranty can help. Overspending does not just apply to eating out too many times a month. We all have appliances and electronics in our homes, and if something goes wrong with one of them, we need to call for a repair or replace it. If the manufacturer’s warranty has run out (most of them don’t last very long), we are stuck paying the high repair bill, which can blow an entire budget for the month.
An Upsie extended warranty
helps you stay financially fit by protecting you against these high repair costs. In addition, Upsie’s warranty protection costs up to 70% less than the competition, and you can even pay over time with Klarna
, so your budget stays even.
Learn More About Finances: