1. Essentials FirstAvoiding overspending starts with the basics. What are the essential living costs that you have to pay? Before you spend on frivolous items, make sure that you have your rent and bills covered. Once that´s taken care of, you know how much remains and that you won´t have to worry about paying the bills because you´ve overspent.
2. Cash Is KingIf you want to avoid overspending when you go shopping, don´t take your credit cards ´just in case´. If you do, it´s all too tempting to pull them out when you see something you like, or spend more in the supermarket because you have your cards. So take a fixed amount of cash, then you won´t be tempted to spend more.
3. Financial ExamKeep a spending diary, and look at where your money is actually going. You might be unpleasantly surprised at how much you spend on takeaway coffees or nights out. Carrying out a close examination of your finances and identifying spending patterns will help you stop wasting money.
4. BudgetIf you know you´ll have a big expense coming up, like getting your car repaired, budget for it. Put the money aside, or save a regular amount, so that when the time comes you haven´t spent all your money on something else, and can easily pay for what you need.
5. Think TwiceYes, we´ve all done it – gone into a store, seen something we loved, and bought it because it might not be there next time. But be honest – can you really not live without it? Walking away and thinking about whether you really like it – and can afford it – may well stop you that you can´t afford on something you don´t need.
6. Smart SalesRemember that something is not a bargain just because it´s reduced in price. In this winter´s sales, I bought one thing I needed, and one thing I loved. Neither were expensive, and I´ve already got a lot of use out of them. I wasn´t tempted by anything else, so I didn´t waste money on buying things ´just because they were cheap´.
7. Online Is OutOnline shopping is undoubtedly a great convenience, but it´s also a terrible temptation to overspend. With just a click, you can add another item to your virtual basket, plus you reason that you might as well order more because you´re paying the postage costs anyway. So be very careful with online shopping.
8. What´s in The Cupboard?Before buying new clothes or other items, whether large or small, check whether you already have something like it. Yes, the ´Six Black Skirts´ syndrome. Occasionally it makes sense to stock up on things you know you´ll use, if they´re at a bargain price, but in general beware of buying more of the same.
It´s really vital to avoid overspending, because this financial crisis is not going to be over in a hurry. Besides, spending beyond one´s means was one of the reasons why the problems started. So be smart with your money, spend wisely and save where you can. What´s the best method you´ve found for avoiding ?