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Examine Your Spending Habits

The Balance looks into “The Psychology of Spending Money” to encourage readers to examine their spending habits. If you can figure out what causes you to spend more than you should, you can work on changing those habits instead of repairing the damage that happens when you overspend.

You may be familiar with the advice that one should keep a spending log to track spending habits but to really understand your financial missteps, you may need to go a little deeper because

“Identifying the triggers that stimulate the urge to splurge can be uncomfortable, but if you don’t face them, you may never get control of your spending and your debt.”

The Balance recommends not just noting the money spent but also writing down your moods so you can understand your spending decisions.

Once you recognize what triggers you to spend unwisely, you may also need to examine what causes those moments when you spend without thinking or considering the effects. It might be that you are copying behaviors you saw growing up. It may relate more to your current circumstances and how you feel about yourself overall. If you start to remind yourself that your worth isn’t connected to money or possessions, you may find less of a need to spend unwisely.

It also helps to learn more about money and financial planning. The things you buy on impulse are often not investments in your future. Once you start considering how you want to live (both now and in retirement) and work on financial goals, that may become more important than the things you want right now.

And if you need to break the psychological hold that using credit has on you, you may have to try putting your credit card(s) on ice–literally if necessary. Credit is convenient and the option to ‘buy now, pay later’ is more than some people can handle. There is no shame in switching to cash or using a debit card.