Factors Affecting Overspending


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The key to overcoming overspending is to realize the factors affecting it.

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Factors Affecting Overspending

  1. 1. Factors Affecting Overspending and Tips on How to Prevent Overspending
  2. 2. Factors Affecting Overspending <ul><li>In order to acquire enough wealth and gain financial freedom, it’s important to spend less than what you earn. Although the concept is very easy, a lot of people find it hard to do such. To further understand the reasons behind this, it’s important for a person to examine the idea of overspending. Knowing the factors that affect spending can help you a lot in controlling your money and fighting back any urges to overspend. </li></ul>
  3. 3. Cash Accessibility <ul><li>As compared before, people can now access their money much easier. Back in the days, people usually have to get their checks from their layer and then go to the bank to deposit before having any chance to spend their income. A complete access to one’s bank account can only be dangerous because it allows the person to get money whenever they wanted to buy something . </li></ul>
  4. 4. <ul><li>In some cases, it only takes having a debit card and swiping it to do the purchase. However, it’s necessary to realize that as you swipe and withdraw, you reduce your income and financial capabilities. It might be a good idea to work with having cash on hand rather than depending on an accessible debit account. </li></ul>Cash Accessibility
  5. 5. Accessible Credit <ul><li>Just like debit accounts, another reason for overspending these days is because people can avail credits very easily. For instance, there are credit cards, auto loans, refinancing services and even mortgage which allows people to charge their expenses to credit and pay on installment basis. Sometimes procedures can only comprise of filling out forms and submitting information to websites. </li></ul>
  6. 6. Accessible Credit <ul><li>The accessibility of credits only increases the chances of overspending and even getting bankrupt. In many cases, too many available credit options can feel like there’s too much free money around. However, it’s important for individuals to realize that credits translate to debt and regardless of the terms provided they will have to pay for it. </li></ul>
  7. 7. Credit Card Abuse <ul><li>Although credit cards are already part of accessible credit, they have a significant impact over budget and spending that they deserve a separate discussion. Credit cards are efficient tools when used properly but because it offers the illusion that you can afford everything and can pay for it in the future, it tends to encourage the impulsive buyer in many people </li></ul>
  8. 8. Credit Card Abuse <ul><li>The most important thing to learn when dealing with credit cards is that it can be used to buy big purchases which may not otherwise be possible in one swoop; it allows people to buy things and pay on an installment basis. However, it’s necessary to note that credit card purchases should only be made if income can accommodate for the monthly financial obligation. Also remember that monthly payments tend to have interest rates so you’ll in fact be spending more than just the purchase. </li></ul>
  9. 9. For tips on preventing overspending and other personal finance help, go to ibudgetmanager.com. Image Credits: http://newtech.aurum3.com/ http://www.lifehack.org/