Title: Overspending? Tips to take back control
Overspending is a challenge for many people from all walks of life. Some of us spend more than we can afford to because we have more costs than we can afford. Some of us overspend because we haven't mastered the skill of budgeting or are not focused on our goals. Either way, overspending is something that can be controlled. But it does take some practice and being honest with yourself.
Let's take a look at why some people overspend, and how it can be stopped.
Common reasons for overspending
How many of us have bought something, or wanted to buy something, because we saw a friend flaunting it on Instagram? Our friends lives appear glamourous on social media as they travel more, spend more, and dine out more than we do. Unfortunately, trying to keep up with them can be expensive and is not a good way to spend your money. Rather, understand that not everything is as it seems, and instead try to focus on building a life according to your own needs, wants, and desires.
Do you normally go to the shops without a shopping list? Do you decide that you need an item only when you see it on the shelf? If you answered 'yes', you may be an impulse buyer! Buying on impulse is an easy way to overspend. The best remedy is to write a list before you go to the shops and buy only the items on your list.
Failing to budget
If you do not know what you earn, spend and owe, there will be no limit to your bad spending habits. When you use a budget to plan how much you will spend, you find out whether or not you have the money to do the things you want to do or need to do.
How to resist the urge to splurge
- Categorise expenses
Start by dividing your expenses into categories, such as groceries, school supplies, and commuting, and decide how much you will spend on each in the month. You can allocate each category a MyWORLD Savings Pocket to manage each budget.
- Set short term goals
Set aside a few Rand each month in a savings account or your MyWORLD Savings Pocket. You could decide to save R1000 or R500 a month, whatever you can afford. Try to allocate your savings right after payday so that you’re not tempted to spend your savings.
- Use your banking app to monitor your account
Online banking gives you a full view of your account, making it easier to manage your finances. At any given moment, if you have an internet connection, you can check your balances through your African Bank online account.
Spending less than what you earn becomes easier when you know exactly what you spend money on, and how much you have available to spend. You can then take simple, but effective, steps to take control of your budget.