Signs You Are Overspending (3 Minute Debt Break)

2022-12-16  3 minute read

Credit Counselling

Household overspending is one of the most common causes of financial insolvency. It’s also one of the easiest to overlook. Overspending tends to creep up slowly and camouflage itself as a different kind of financial challenge. But once you know the symptoms, they’re almost impossible to ignore. You can eliminate overspending almost entirely by introducing just three straightforward techniques.

Consumer holding credit card and banking with mobile phone

The first sign is increasingly living paycheque to paycheque. The solution is to create a budget and use it consistently. A budget is extremely helpful for planning, tracking, and optimizing your spending. It won’t increase your income, but it can help you stretch your current earnings a whole lot further. A budget paints your complete financial picture. It helps you understand what expenses and spending behaviors are contributing to financial difficulties, and how you can change them. 

Another sign you are overspending is that you are unable to save consistently. A solution can be to automate your savings and make it slightly difficult to access. The most effective savers tend to treat it like any other living expense. They pay themselves as diligently and consistently as they pay their rent or mortgage. Most banks and credit unions allow you to automate certain transactions. You can use this functionality to transfer a pre-determined amount from your chequing account to your savings account every month or every payday. 

Another sure sign of overspending is your credit card balances keep increasing. Credit cards are a horrible way to borrow money. With average interest rates nearing 20 percent, so a small monthly balance can quickly spiral into an unmanageable debt. A solution… create rules around the card use! 
Here are some rules that might help… Keep your credit card limit below your net monthly income. Pay off your credit card balance after every purchase. Pre-plan your credit card spending and use it only for essential purchases. And one of the best… leave your credit card at home if you don’t have a specific plan or reason to use it. 

Life happens. And we’re all affected at times by circumstances beyond our control. Help is available and a financial fresh start is possible — even if your debt is due to your own, or someone else’s overspending. 

Contact MNP for a Free Confidential Consultation to learn your options today. During this no-obligation initial meeting, a Licensed Insolvency Trustee will review your entire financial situation and ask about your challenges and goals. They will outline all the potential options available to you and provide unbiased guidance on your best path forward. This may include Bankruptcy or a Consumer Proposal or could involve a different solution altogether.
No matter what you decide, you’ll have all the information, referrals and support you need to address your debt and overcome it for good.



Subscribe to MNP 3 Minute Debt Break on your favourite streaming service.

 Listen on Apple Podcasts  Listen on Spotify  Listen on YouTube
 Listen on Google Podcasts  Listen on tune in  Listen on SoundCloud
Consultation icon