August 10, 2011

Category: Budgeting

10 Signs You Are Over Spending

So you like to shop?  Most Americans look forward to a great sale, everything must go bonanzas and picking up an outfit for a special occasion.  With credit card interest rates soaring, this is probably the worst time to let your fondness for department store mining to get out of hand. 

Admittedly, I’m a pushover for a sales promotion.  If changing my middle name to Half-Price would always guarantee 50% off, I just might seriously consider it.  All jokes aside, shopping for an amazing outfit or browsing racks for the perfect pair of shoes is understandable.  However, there are signs that your spending is probably out of control and I’m going to discuss 10 of them. 

  1. Two or more credit cards are maxed out 

One of the first signs suggesting you’ve gone over your shopping budget is maxing out two or more credit cards.  Pushing the debt limit on one of them can be easily explained.  The initial credit availability is low to begin with or a large purchase happens to extinguish the entire credit line at once.  The chance that two or more credit vehicles are maxed out due to pure necessity is highly unlikely.  A more likely result, you’re probably over spending. 

  2. You feel compelled to go shopping every week(end)

If hitting the mall is a common part of your weekly activities, and you frequently dash home afterwards with shopping bags galore then you’re probably over spending. 

  3. Often afraid your credit card will be declined 

Do you cringe when presenting your credit cards at checkout counters?  If you hand your card to the waiter after dinner and then say a little prayer for approval, you’re probably over spending. 

  4. Can only afford to pay the minimum on your credit card(s) 

Do you get the credit card bill in the mail then immediately shake your piggy empty for the minimum payment?   Sending in the smallest possible dollar amount, because that’s the best you can do, helps the card company more than you.  Because you pay interest on the daily balance, your credit provider makes a lot of extra money on top of the normal rate for purchases.   Either way, a minimum payment means two things.  You’ve gotten behind on your bills and you’re probably over spending. 

  5. Constantly flipping debt from old cards to new ones 

There’s nothing wrong with accepting a card company’s line of credit then using it to pay off another balance with a higher rate.  But, when your best method of dealing with increasing debt is applying for numerous credit cards to stay ahead of rising debt, you’re probably drowning in it and over spending is likely pulling you under. 

  6. Always asking friends and family for cash 

Knocking on doors with your hand out is never fun.  If friends and family members have either cut off the purse strings or refuse to take your calls, they’re tired of lending you money.  You’re probably just as tired of asking and guilty of over spending. 

  7. Seriously consider selling blood or plasma for a retail purchase 

No one would blame you for making a blood or plasma contribution.  Countless lives are saved by selfless donors.  On the other hand, lining up to sell your precious life force in order to buy a new outfit and matching accessories may be saying a lot about you.  I think it’s safe to conclude that you have a weakness for over spending. 

  8. Credit card debt is higher than your monthly income 

One of the rules I live and shop by is simple.  Never allow credit card debt to rise above monthly income.  I believe in pre-set controls and self-proposed debt limits to keep spending from getting out of control.  They help to manage your income, expenses and lessen appetites for over spending. 

  9. Clothes in your closet still have tags hanging on them 

Purchased clothes but haven’t gotten around to wearing them?  Unless you have so much money that hanging some of it in your closet doesn’t bother you, then you’re over spending.  Look, average consumers can’t afford to hang up money in their closets.  And, if you charged the clothes on a credit card, you’re over spending and paying interest on it as well. 

  10. You realize a Payday or Title Loan is now the best option for supplemental cash 

Despite what you may think of Payday or Title Loan companies, some of them do provide good services at reasonable terms.  But you have to keep in mind that industry loan products are short term answers to supplemental cash needs.  You could end up paying more than you planned for extending the terms of the loan so read the application carefully. If you do happen to feel that you fit any of the ten signs of over spending, it’s not too late.  Revise your budget and stick to it! 

 Written By Victor McGlothin Victor writes money management tips and other financial hints for ace cash express.  Before joining ace, Victor wrote several bestselling novels and worked in upper management in the banking industry.  When Victor is not helping consumers with responsible spending ideas, he’s working on a “Talking Money Tips” audio book.  Follow him on twitter @iwritemoneytips  and @acecash -Bio