Overspending can happen to anyone. If you overspend, there's no need to panic. Instead, do these 4 things.
Do These 4 Things When You Overspend
1. Find out the cause
When you see that there is excessive spending, the first thing to do is to find out the cause. Why the overspending?
Is it because of a situation that forces you to spend more money than you should, for example, because you are sick so you have to keep buying medicine until you recover? Spending for healthcare inevitably does not stick to the budget.
Is it because you can't resist the temptation as promotions or discounts keep popping up around you?
If what happens to you is the first example, then it’s fine. It only happens occasionally, and you overspend because you have to.
However, if what happens is the second example, then you must immediately take action so that it doesn't happen again the next time. You can read the article 5 Surefire Ways to Resist Emotional Spending.
2. Find a way to make up for it
If you overspend not because of a situation that requires you to do so, then the next thing you can do is find a way to make up for it.
This is similar to the situation of people who are on a diet. There are times when they can't stand the temptation and allow themselves to have cheat meals. To make up for it, they could exercise longer or reduce their calorie intake on the following days.
Likewise when you overspend. What can be done to make up for it? For example you can freeze your spending for a week or look for additional income that is equal to the amount of overspending. This is done so that everything returns to balance.
3. Reassess your budget
Maybe you need to reassess your budget. This needs to be done when you're constantly overspending, even though you're determined that it won't happen again.
It could be because the budget is unrealistic. Is it possible to increase the budget for category X spending and reduce the budget for category Y spending? Because it's been 3 months in a row that the category X spending does not stick to the budget.
Related article: 3 Common Budgeting Mistakes
4. Using the Jago application to manage finances
You can use the Jago application, which is owned by Bank Jago, to manage your finances better, easily and practically.
With the Jago Pocket feature, you can separate your many needs so they don't get mixed up. Budget can be allocated to each Pocket that has been created. It will be easier to monitor the budget and expenses for each need afterwards.
When the budget in the Pocket has been used up, this is a sign that you have to wait until the next time you do budgeting, on payday for example, to use the money. In this way, overspending can be prevented.
To control spending, you can also set a limit on your Jago Visa Debit Card that is already linked to one of the Pockets, in this case the Spending Pocket. When your spending has reached the maximum limit, the debit card cannot be used to complete transactions.
There is also the Spend Analysis feature that presents data on increases or decreases in spending, both in total and per category, between months. If you already use the Spend Analysis feature, you don't need to bother recording expenses in a month.
Let’s reduce the possibility of overspending or prevent overspend and make sure you always stick to the budget. The Jago application can be downloaded here for those who don't have it yet.