Not giving in to consumer appeals, peer pressure, convenience are some of the reasons why you spend more than you can afford. It is then time to reevaluate habits.
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Impulse purchases, convenience, convenience and social pressure to have and consume are some of the reasons that can lead you to spend more than you can.
To keep your personal finances under control and eventually increase your monthly savings margin, the first thing to do is to be aware of these habits and adjust your lifestyle to your real possibilities and needs.
So, if some of the reasons listed below are negatively influencing your monthly budget, it’s time to assess ingrained habits and try to invest in your financial education.
Reasons why you spend more than you can afford
If you are one of those people who arrives in the middle of the month and doesn’t know where you spent your salary, then it’s time to make a plan.
Knowing where your money comes from and where it goes is critical to keeping your finances under control.
Create a monthly budget and record all your earnings, expenses and then set aside a portion of your salary (however small) to set up an emergency fund. This type of strategy will help you stay disciplined when it comes to unnecessary spending.
Give in to the consumer appeal of seductive advertising campaigns
Avoid buying things you don’t need, no matter how enticing the advertisement. Try to be more rational in the consumption choices you make.
Ease of access to credit
In order not to give in to the temptation to buy just because you have your credit card in your wallet, our advice is to keep it at home. Only use it for an emergency or to meet an unexpected expense.
It is also important not to forget that entities that provide easy and fast credit do not do so for nothing, quite the contrary: they charge high interest rates, which can actually make your financial life difficult.
In this regard, we would like to point out that there is entities that are not authorized to grant creditso you should always confirm this information with the Bank of Portugal.
And the convenience of homebanking
The thrift you should have with your credit card also applies to online purchases. Not seeing the money come out of your wallet is half way to losing control of your budget.
Be permeable to peer pressure
Peer pressure, whether from friends or family, has force in many situations, including spending money on things we don’t need. If friends have something, that doesn’t mean you need to have it too.
The power of ingrained habits
Currently, with the wide variety of stores, grocery stores, super and hypermarkets that exist, saving money on purchases is simpler. So, even if you’re used to going to the same supermarket all the time, for example, don’t forget to check out the competition’s prices.
Who has never entered a store to buy a specific item and left with more than what they had planned?
At the supermarket, for example, try to restrict your shopping to the list of necessities and avoid “walking” through the aisles. Much less go shopping when you’re hungry or when you’re tired. It is in these moments of greater fragility, so to speak, that it will be more difficult to control certain impulses.
Especially if it is the day to receive the salary
The day you receive your paycheck, you are much more likely to spend money on non-essentials.
Before giving in to temptation, don’t forget that you have set savings goals and that you need to ensure your fixed monthly expenses. After doing this management, nothing prevents you from buying yourself a treat (albeit with common sense).
Article originally published May 2021. Updated November 2022.