People spend—and overspend—for a lot of reasons. Here are five reasons may people spend more than they have. If you have trouble overspending, uncovering why is an important step in learning to reign in the behavior and get on track to financial stability.
Overspender #1: The Primal Male
A study reveals that overspending among males may be traced to cavemen. Long ago, men’s value (and appeal to mates) was based upon their ability to provide food, shelter, and protection. Fast forward a few thousands years, and what says “I’ve got money” to potential hook-ups than the latest clothes, cars, and electronics. The study pegged high levels of spending and debt to increased sexual activity with multiple partners.
Overspender #2: The Financially Ignorant
Perhaps most often, overspending is simply the result of ignoring one’s personal finances. If you never consider how much money is coming in and how much is going out, it’s easy to get into trouble. Has this happened to you? Check out the many budgeting tools available that can help.
Overpspender #3: The Status Seeker
Similar to the primal male, the status seeker is the one always trying to keep up with the Joneses, although it the problem is less biological and more social. Status seekers buy cars, clothes, and houses that are too rich for their incomes and will do anything to preserve their inflated lifestyle—even when financial ruin is knocking at the door.
Overspender #4: The Compulsive Shopper
For some, spending isn’t just a problem, it’s an addiction. Shopaholics Anonymous defines compulsive shoppers as people who buy to relieve anxiety. No different than alcoholism or drug addiction, compulsive shoppers may be driven to do anything to buy that next item—or to cover up their addiction or the debt or criminal activity used to finance it.
Overspender #5: The Underearner
Some people don’t have a spending problem, they have an earning problem. The fact is, many minimum- and low-wage jobs in America don’t pay enough to maintain a lifestyle above the poverty line. In more expensive parts of the country, you need to make a lot more than minimum wage just to get by. If this is you, it’s time to take a second job, go back to school, or start a business on the side and boost your income!
Have you ever fallen into one of these categories of overspenders? Are there any I’m missing?