There are many reason people overspend. Most of the overspending has to with convenience. Overspending in this economy can cause a whirlwind of problems. Overspending is the reason the economy is in the recession. The main causes of overspending is lack of budget, fees (ATM, late and etc), affordability payments and etc.
Lack of budget
When you do not have a budget is very easy to spend more than you make. Most people lack discipline to stick to a budget or make excuses not sit down and make a budget. When budgeting it is important to pride yourself on how much you can save at the same reward your self for your efforts. Lack of budget is what causes your money to be in quicksand. Budgeting is important not only to save money but it is a good way of tracking when and where you spend money.
Fees (ATM, Late, and etc)
Sometimes when spending people have a tendency to buy things out of convenience. When buying things out of convenience you will quickly find yourself blowing your money or budget in no time flat. Fees are one of the most overlooked aspects of overspending. When you make a withdrawal from a bank other than your bank people have a tendency to brush off the fees. When they get their billing statement their jaw drops followed by embarrassment for lack of control. When make bill payments people have a tendency to be a month behind on bills which almost the norm, but it has its price of taking away flexibility. Late fees can be grocery or gas money for some instances. There are other forms of fees such as early termination fees, roaming charges, going over your minutes with a cell phone, and etc. Pay attention and leave some wiggle room.
Most if not all car dealers are trained to sell the consumer on affordability depending on the client. The infamous question “How much can you afford?” should be a red flag. When approaching a dealership make sure you have shopped around for your dream car. You can get a good price when you buy a car out of season. Most SUV’s are sold in the winter time so it is better to buy in the spring or summer. Affordability payments strategy is also used by mortgage lenders and well, look where that got us. People were buying houses based on what they could afford as opposed to what they needed. It is better to invest in your property with wiggle room and invest the rest of the money else where. Good rule thumb over plan (save) and under spend.
There are many causes of overspending but the ones mentioned above I put in my top three. For some people overspending is a matter of shopping too much. Anyone can make changes to their spending habits. Good luck!