Wednesday, January 19, 2011

Seven Signs Of Shocking Spending

We are all guilty of buying something that we don't need every now and then, but have you ever known someone to overspend so much they carry only two pennies and a ball of lint in their pocket? Or maybe you yourself have a overspending habit you want to kick but don't believe it is a big problem. The answers to your questions lie below! We have created a seven point checklist, so you can find out once and for all if you are overspending. Let's get started and see what the damage is...

  • You are out of money by your payday
    If you find yourself living paycheck to paycheck, you are overspending. This is a dangerous habit because you have no cushion for emergencies, and if you lose your job you’ll be completely broke. Living paycheck to paycheck prevents you from saving money, and makes it difficult to get ahead or pay off growing debt.
  • You obsess over money
    If you go to bed and wake up thinking about money, such as how much you’ve spent, how little you have or what you want to buy next, you may be obsessed with money and spending it. With money on your mind and debt piling high, you may become frustrated, stressed and depressed, causing you to spend more money to feel better.
  • You hide your purchases and feel guilty or embarrassed for irrationally spending
    If you hide purchases from your partner, family and friends, and argue with them over your spending habits, you may be an over-spender. When the people closest to you notice your irrational spending, they will often interject and urge you to change your habits. You may feel guilty or embarrassed for spending more than you can afford, which shows you’ve gone too far.
  • You pay off debt but feel urges to spend freely again
    You haven’t learned your lesson if you pay off debt and want to start spending irrationally all over again. This cycle of overspending is not healthy because you can easily fall into debt again. Getting out of debt is difficult, but it does not mean you should reward yourself by splurging. If you feel urges to go on a spending spree even after paying off debt, you may be an over-spender.
  • Your checking account is frequently overdrawn
    Credit cards aren’t the only form of payment you can get into trouble with. Overdrawing your debit card and bouncing checks are other signs of overspending. Whenever you use a debit card or write a check to make a purchase or withdrawal for more than the amount in your checking account, you’ll overdraw and subsequently receive an overdraft fee for having insufficient funds. Over time, overdrawn accounts can be shut down and unpaid overdraft fees will be turned over to collections.
  • You use credit cards to pay for everything, even when you have cash
    Instead of taking out cash or using the money you have on-hand, you insist on using your credit cards to buy even the smallest purchases. Putting all of your purchases on credit cards creates a false sense of financial security because it lets you keep cash in your wallet, while ignoring how much you’ve actually spent. Carrying cash and using it on smaller purchases will give you a physical, realistic idea of how much money you’re spending on a daily basis, and if you are in fact an over-spender.
  • You ignore paying your bills or only pay the minimum amount
    Unopened or unpaid bills are a bad sign of overspending, because it shows you are incapable of making payments or don’t care about having debt. Nothing good comes from this kind of denial. Not only are you ignoring your fiscal responsibilities, but you are putting yourself in a load of debt and a future of credit problems. In addition, only paying the minimum payment for your credit cards is not going to help your credit or overspending problem. Instead, you are likely to continue spending freely, while the debt rises and your issues persist.
So how did you score on the seven points? If you had one point or all seven, take a deep breath and relax but not too much. It is never too late to get your finances/credit in order. If you need some help in making the transformation from over-spender to wise-spender, visit EECU today and see what they can do for you! Happy Saving!

P.s. The golden toilet was actually made for someone...

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