Take back control of your finances after New Year’s overspending
January 15, 2023 at 7:16 p.m
2 min of reading
Have you been tempted by lucrative New Year discounts and offers and ended up overspending?
Don’t worry, you’re not alone. Your instant gratification was at stake.
Since there is no money, there is no use crying over spilled milk.
However, the good part is that you can still regain control of your personal finances.
Read on to find out how.
Find out where you spent too much
Your first step should be to evaluate your transactions and discover where you have exceeded your capacity.
Estimate all your cash, UPI and debit or credit card payments. Record them in the table.
This will help you keep track of which products or services you bought, which were not so necessary and could have been avoided.
Once you’ve assessed your overspending, the next step is to stop it.
This could mean cutting back on dining out, shopping online on e-commerce platforms, or the usual clubbing or partying.
Remember, you can still take control of your spending. Just take things one day at a time.
Only shop responsibly and avoid causing more trouble than necessary.
Get out of credit card debt
The next important step is to get rid of your debts.
If you overspend using your credit card, thinking you’ll pay it off with your monthly income next month, that’s unhealthy financial behavior.
With lucrative credit card discount offers, people often indulge in overspending and regret it later.
Try to pay off the outstanding balance during the interest-free period to avoid interest charges.
If you don’t have a budget, now is the time to create one.
Transfer whatever is left over to a separate account and use the remaining money only for your essential expenses.
Create both short-term and long-term budgets.
A mini-budget serves as a stopgap measure to help you get back on track.
A long-term budget helps you plan your long-term goals.
Follow the rule “Income – Savings = Expenses”.
When you get paid next month, follow the formula “Income minus savings equals expenditure (Income – Savings = Expenditure)”.
Put the amount you need to save, not what you can save, into a separate account.
Then consider the amount you have left as your actual income.
This psychological hack helps those who lack self-control when it comes to spending.