Sometimes it's tough to find a healthy balance when it comes to your finances. While it's nice to treat yo' self every so often, doing it on the regular can be one of the signs that you may be spending too much money. Even though money is a taboo topic and can be a sensitive issue, it's important to be honest with yourself. While it would be great to make a million dollars and spend it frivolously all over town, you also need to keep your future in mind.
According to the site for the financial app Mint, you might want to be more careful with your money if you're not paying your bills on time, paying for your necessities with credit cards, or your struggling to meet minimum payments. If you find yourself dealing with these things on the regular, it might be a good idea to credit a budget and start using cash so you can keep an eye on your finances and spend less money. Feeling stressed about money is something that no one should have to deal with on a daily basis that's why it's important to be honest with yourself and be aware of the signs that you're spending too much money. Need some help in that department? Here are nine signs you may be sending more money than you need to.
1. You Carry A Large Balance On Your Credit Card
Having more than 30 percent on your credit card is considered to be a big no-no. If you find that your credit card limit is higher than your savings account, than you might want to switch things up. According to U.S. Money, credit cards have ways where you can track your expenses. You can also use money apps such as Mint to exactly figure out where everything is going.
2. You're Easily Swayed By Your Social Activities
It sucks missing out on fun adventures with your friends. But while that margarita at happy hour sounds awesome, paying your bills is even better. According to Business Insider, author of Living Well, Spending Less: 12 Secrets to the Good Life Ruth Soukup said, "This can be as innocent as going out to eat when you've already exhausted your restaurant fund for the month, or as extreme as paying rent you can't afford in order to keep up with your friends."
3. You Don't Have An Emergency Fun
Ideally, you want to have 10 percent of your income in your savings, but even five percent is just as good. Essentially, you want to make sure that you have enough in your back for those rainy days. According to Business Insider, billionaire John Paul DeJoria states that it's important to have at least six months worth of savings in your account, but it's OK to have more or less depending on how much you make annually.
4. You're Living Paycheck To Paycheck
You probably need to redo your finances if you find yourself living from paycheck to paycheck and not saving any money at the end of the month. According to U.S. Money, if you have a budget, but still find yourself short at the end of every month, it might be time to cut your expenses.
5. You Don't Have A Budget
According to Daily Worth, certified money coach Ashley Feinstein, founder of Knowing Your Worth said, "I recommend that every client keep a money journal for at least a couple of weeks to get conscious about where their money is going." If there's one thing you need to do ASAP on this list, is creating a budget to help get your finances on track.
6. Your Fridge Is Empty
You might be thinking that this has no correlation with your spending habit, but it actually does. Think about it: if your fridge is empty and you never have to do the dishes, it probably means you spend a lot of money eating out. According to money and career site, Cheat Sheet, if you're spending an average of $45 for two eating out for dinner once or two a week, you've probably already spent more than you would on a week of groceries. And that's not even including drinks, y'all.
7. You Borrow From Friends Or Family
While it's OK to borrow every now and then (in addition to paying them back on a timely manner), you don't want to be borrowing every time you need to pay your rent. According to the Huffington Post, if you're constantly asking your friends and family for money, then it means you either are spending way too much or you need to look for a new job. “Being unable to pay back the loan can lead to tension and can ruin your relationship,” said attorney who concentrates in debt resolution solutions and author of Life & Debt Leslie H. Tayne.
8. You Don't Know Where Your Money Is Going
If you find yourself forgetting where all your money is going to, whether you use cash or credit, then it might be a sign that you need to fix your finances. According to U.S. Money, people who shop a lot tend to ignore exactly how much money they spend. It's best to figure out a budget on exactly how much spending money you have, so you know when not to go over.
9. You Feel Stressed About Money
According to Business Insider, American Psychological Association conducted a survey in 2015 and found that 72 percent of Americans were stressed about money at least once in the month. One of the key signs you need to pay attention to is how money actually makes you feel. Sometimes finances can make you feel edgy or anxious when you don't have control over your finances. But if you keep track of every penny that goes in and out of your account, then that anxious feeling could subside.
While spending money may bring you happiness, it's important to budget your finances so you can have some in savings. While there are plenty of ways to spend your money, it doesn't necessarily mean you should.