6 Ways to Avoid Overspending

If you find yourself relying too much on paydays and they seem too far away from each other – then you’re splurging on items way out of your budget. You spend a little too much on luxury items such as clothes, electronics or even vacations.

So before you blow-off your next paycheck before you even receive it, here’s a few tips to help you curve your over-the-top spending habits and stay within the limits:

1. Track everything. Since we do almost everything online nowadays, you could also do this step virtually or by traditional paper and pen. All you have to do is to categorize different inflow and outflow of money. Just identify expenses and types of income.

2. Get your total assets. Add up every source of income you have, whether from salary, wages, tips and other sources you may have. Even project-based ones, you have to list them down each month you receive them. Experts say that you shouldn’t rely only on one source of income, as this may post constraints for you. Make those free time productive by engaging in profit-enabling activities.

3. Get your total liabilities. Next up, total all your payables. These fixed expenses include utility, credit card, mortgage bills or rent, and whatever else you have to settle each month. For credit bills, make sure you know the terms before swiping purchases. Don’t allow those enticing discounts and offers get the best of you. Have a masterlist of existing credits so you don’t lose track of what to settle next. Be careful and be vigilant of your payables.

4. Prepare for the unexpected. We all have those splurges and what better way to overcome them is to prepare for them. Don’t shy away from those luxuries because pampering can motivate you further to earn for yourself and your family. These type of unexpected or variable spending needs to be allotted accordingly to avoid spilling over and cutting short fixed expenses. Get your old receipts and from there, template your variable expenses. Don’t be strict though, as too tight budgets make you crave for splurges even more.

5. Save. Instead of waiting for what’s left from your budget, squeeze in savings as part of what you have to allot budget for. They should also be prioritized as they play an important part of your financial freedom. Savings shouldn’t be neglected, as they form a buffer if emergencies happen.

6. Dry run. Test out your budget plan and adjust figures until you get the right combination for each category. Adjust amounts until you get the right blend of all your expenses and splurges. Don’t forget to key in all your earnings. If your overhead expenses just won’t budge, you might want to try another source of income on top of what you’re already earning.