Consumer Watch: Fighting the urge to overspend
OKLAHOMA CITY (KOKH) —
From buying too many cups of coffee, to that last minute impulse buy at the store, we spend more than we mean to in many ways.
There are three culprits that can cause some budget problems, but when you know what they are, it will be easier to fix.
1. Grocery shopping
- Everyone makes that grocery store run, and even with a handy list, a few extra items end up in the cart.
- “The fact that you are busy, you're hungry, you are stressed, you don't know what to cook for dinner tonight-- these are all things that add up to over spending,” says Lisa Rowan, a savings expert with The Penny Hoarder.
- Rowan recommends these two simple steps to tightening up grocery store spending: stick to the list and keep in mind people often buy too much food. Americans waste between 30 and 40 percent of food according to the USDA.
- Vacations may come around less often than the weekly grocery store run, but the amount we overspend can go into the hundreds or thousands of dollars.
- “You get into that mindset that it is a vacation, you have earned it, you deserve it, and why not spend just a little bit more,” says Rowan.
- Dodge the urge to overspend by planning your vacation well, and pre-booking what you want to do. This way you won't be tempted by last minute splurges.
- The third way we overspend comes from a good place, but can get out of hand quickly.
- “The self-care movement is huge, so there is so much temptation out there to get your nails done, get your hair done, get a massage, go to the spa,” says Rowan.
- Caring for your mental well-being by relaxing is important, but doesn’t necessarily mean spending a lot of money. Taking the time to do some peaceful yoga or reading a book at home still counts as self-care, and it's free.
The best ways to keep from overspending:
- Accountability buddies: a friend can help you stay on track if you share your goals.
- Envelope method: use cash and when you are out, you are out.
- Budget in your fun: The Penny Hoarder likes the 50-20-30 spending plan.
- The 50-20-30 spending plan means keeping your monthly commitments, like bills, at 50-percent of your budget, save 20-percent, and 30-percent is discretionary spending.
Your monthly bills may add up to more than 50-percent of your take home income. If this is the case, the recommendation is that you use the 30-percent discretionary money to make up the different. It's important to keep your savings untouched as long as possible.