People overspend for a multitude of reasons. However, some people aren’t even aware that they are overspending! Accidents happen, and we can bust our budget from time to time, but I noticed that the top reasons people overspend are rarely an accident! Here are the top ten reasons people overspend.

Top 10 Reasons People Overspend

 

Trying to keep up with the Joneses

Maintaining an image is expensive. If you are always trying to one-up your neighbors or maintain your social status, this can cause you to overspend.

 

Opportunity cost neglect

Sometimes it is worth the money to gain the opportunity, but this isn’t the case for everything. We often overspend with the hope that the opportunity we gain will be worth more than the money we spent.

 

Ignorance

You have probably heard this rephrased as not knowing how much you spent. This happens for people who aren’t aware of how much they should spend or what they are spending.

Having a budget can help with this. This is a good place to start. 

Buying on impulse

Impulse buys are usually the first source of a busted budget! Those candy bars at checkout or that top you splurged on while shopping at Target are fine when there is room for it. However, these small purchases add up!

Want to know the real cost of the impulse buy? Here are 7 ways to stop overspending!

 

“The money is on the way” mindset

We have this mentality that the money being on the way means we can spend it now. However, this mindset backfires in two ways. Either A the money doesn’t come, or it’s not what we expected. Or B, we forget we spent it and spend it “again.”

 

Special occasions

We let ourselves go little nuts when it’s a special occasion instead of justifying that we don’t have the money to spend it. A birthday or anniversary usually gets us into a treat yourself mindset, which can lead down a slippery slope.

 

Having all your finances digital

While not always a problem, if you never look at your accounts or even pay your cards, you don’t know how much you are spending until your bill slaps you in the face.

Want to start saving money? Here are 10 things you can cut from your budget! 

You don’t have a budget

Even ultra frugal people can still go over budget if they don’t have a budget in place. Not knowing how much you can spend will cause you to spend more than you have.

Curious? These are 20 things frugal people do every day. 

Instant gratification

The want it now mindset is strong in all of us. However, rarely do we need that purchase now. Rather than waiting for it to be in our price range or find a discount, we overspend by getting it now.

 

Retail therapy

When we are upset or feeling angry, we tend to make bad money decisions. Retail therapy can cost you thousands if you are not careful! Retail therapy is very real, and some people can’t control their spending when they’re not feeling well.

 

Did any of these reasons shock you? Are you guilty of any of these reasons? I know that I have done one or two before! Hopefully, this post has helped make you mindful of bad money moves that cause either you or a loved one to overspend.

 Want to know how to live cheap without feeling cheap? Check this out!

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