As it should be clear by now, our personal budget is a way of controlling our unlimited wants to match our limited incomes. We only have so much money to spend, save and enjoy.
But what if your budget just can’t accommodate your excessive spending? So much so that your paycheck doesn’t cover your spending, so you are forced to use your credit cards or borrow from others. Let us face it, this situation can’t last forever. Sooner or later, you will find yourself in deep debt, or worse yet, bankrupt.
What is the solution? How to force yourself to spend less and reconcile your spending with your budget? We need to be sure that we are only spending 100% of what we make or less, and not even 1% more than that. Let us go over a few proven and effective therapies for those who like-or are spending sick- to spend like there is no tomorrow:
1-Realize this is simply not sustainable: first, you have to admit and aknowledge that you can’t keep doing this forever and that you have to bring your spending under control and within your budget limit.
2-Budget for big and necessary purchases: if there is something that you absolutely have to buy, start budgeting for it well in advance
3-Avoid the trip to the mall: if the mall is where you spend your money the most, then stopping your spending is as simple as not going to the mall in the first place. And If this is easier said than done, then maybe go less? While the mall is here is a metaphor for any place where you spend with ease, the idea here is to be mindful of any place – including online shopping – where you can’t control your spending.
4– Track your spending: Keeping a record of your daily, weekly or monthly spending can help you identify areas where you are overspending and make adjustments accordingly. In other words, by finding hidden trends, you are able to correct them.
5– Find alternative ways to fulfill your wants, needs and desires: Instead of spending money on entertainment, try finding low-cost or free alternatives that can bring you joy and satisfaction. For example, instead of spending money on movies, you can do it at home using Netflix or other streaming service, and even make your own popcorn and foods. It will save you a significant amount of money.
To effectively reconcile spending with a personal budget, it is important to admit unsustainable spending habits, budget for necessary purchases, avoid overspending triggers, track spending, and find alternative ways to fulfill wants and needs. By following these steps, individuals can bring their spending under control and within budget limits, reducing the risk of debt or bankruptcy.