How To Stop Overspending: 3 Steps To Curbing The Habit

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"Overspending is the biggest culprit when it comes to derailed budgets and unaccomplished financial goals."

As you probably know, overspending is when you spend more than you earn, and in many cases find yourself in the red or in "the hole" each month.

The act of overspending is very much behavioral, and it ties into self-discipline (or a lack thereof). Until you can get your overspending under control, it can be a struggle to save money, pay off debt, invest and have peace of mind about your finances. So what can you do if you find yourself wondering how to stop overspending?

Below are 3 steps for how to stop overspending

Step 1: Know your why

When you set a new goal—for instance, to stop overspending—you need to have a reason you want to change. Or in other words, you need to have a WHY. Having this reason in place is one of the things that will keep you motivated (in addition to working on your self-discipline and building new habits). Your why could be your children, buying a house, moving to a different city. Whatever that thing is that you dream of, or want to look back and be proud of.

Take photos of it, save it on your phone, set calendar reminders—basically, you want to make sure your WHY is always in focus in your everyday life.

Step 2: Identify your triggers

The next step if you're wondering how to stop overspending is to determine what causes you to overspend. Do you find you are overspending when you hang around certain people? When you see what people post on Instagram? When you drive by the mall?

Once you figure out what your spending triggers are, then it's time to address them. This could mean spending less time with the people that you find yourself spending the most money around. Or maybe unfollow people on Instagram, or take a different route so you don't have to drive by the mall all the time.

Identifying and addressing your triggers, especially in the early stages of you working on your overspending habit will help you stay on you on track.

Step 3: Create a budget and go on cash or debit card diet

Having a budget is how you track your income and expenses (learn how to create one HERE). Once you are able to track your income and expenses, then you'll know how much you have left over to spend/save. A good idea is to track your current spending for 30 days to see exactly where your money is going and determine what you need to cut out.

Once you are able to track your expenses for 30 days, you will very likely find areas of unnecessary spending. Eating out, daily coffees, shopping, unused gym memberships, and subscriptions are things you can cut back on or cut out completely.

You may find that a lot of your overspending is unavoidable and you cannot cut it out right away. Things like being tied into a lease and having to pay rent, or being in the middle of a contract period that's costly to terminate. If you're in this situation, then consider some ways to increase your income. Find a better paying job, a part-time job or even start side hustle to bring more money in.

Next, consider ditching your credit cards. Go on a cash/debit card diet where you designate a fixed amount of money that you can spend every week or month. When it runs out, you are done spending until the next month.


Like I mentioned in the intro to this post, overspending can severely impact your financial goals. You don't want to look back in regret at the amount of money you could have saved but didn't because of your poor spending habits. If you struggle with overspending, challenge yourself to work on changing this habit starting now.

Determine your WHY and your triggers, create a budget and try your best to stick to it each month. You might have slip-ups—that's normal! But as long as you stay committed and keep making progress, you can turn your overspending habit around!

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