How To Identify A Shopping Addiction, Poor Spending Habits

January 31, 2010 by Guest Blogger

One of the hardest changes for people with debt is changing their spending habits. We all get used to buying what we want, and that becomes part of our “lifestyle”. I’m not even a big spender, but I know it’s hard for me to give up those things I’ve grown to enjoy. But when times get tough, you need to make some changes. Otherwise, there’s no sense in looking for help with your debt if your main problem is outspending your income.

How To Identify A Shopping Addiction & Poor Spending Habits

So here are some questions to ask yourself to determine if your spending is out of control (some of them are tough, so be honest with yourself):

shopping addiction
Image from dailymail.co.uk.

1) Do you constantly need more credit?
Credit cards are not supposed to be your source of income. So if you need to keep getting more cards so you can buy what you need, your spending is way over the top. And it’s time to stop using credit cards!

2) Are you afraid to even look at your credit card bills?
Sometimes the truth hurts. But until you know the truth, you can’t fix the problem. So take a look at your credit card bills. And look carefully. Do you really need everything you’ve bought? If not, stop buying anything you don’t need to survive. Are your interest rates over 10%? 20%? Higher? If so, call the bank to see if they’ll lower your credit card interest rates.

3) Have you been turned down for credit?
Big warning sign here. If you’re getting turned down for credit, you’re in the “red zone” for financial problems. So stop using credit, and focus on paying off credit card debt and paying on time. Before long, your credit score will improve and you’ll get back on track.

4) Do you have an adequate emergency fund?
Without an emergency fund, you’ll struggle every time you need to fix your car, pay your medical bills, or buy food when money is tight. And where will you find the money to pay for these things? Your credit cards, right? So do yourself a favor, and set up a high interest savings account for an emergency fund. Put in $10 or $20 or $50 a week, or whatever you can afford, until you have $1,000 saved up.

Tip: Other interesting savings options include: SmartyPig, a free savings account that allows you to save towards your goals, the PerkStreet Financial checking account (which awards you perks rather than a yield), high yield checking accounts and CDs on the best cd rates list.

5) Is your wallet as thick as an encyclopedia?
OK, we’re not talking about family pictures or business calling cards here, that you’ll find in many stuffed wallets. If you’ve got enough plastic to build a house of credit cards, then you need to pick one card to use for emergencies, and put the rest in a drawer somewhere, where you won’t see them all the time. Not to mention what would happen if your wallet was lost or stolen, and some thief got their hands on all of your cards!

So, how many times did you answer “yes” to these questions? The only good “yes” is for the fourth question, the one referencing your emergency fund. Otherwise, it’s official: your spending is out of control. But knowledge is power, as they say, right? So now that you’re aware of your situation, what are you going to do about it?

I would suggest that you sit down, grab a piece of paper, and write down a plan for getting your spending back under control.

Need help getting out of debt? This guest post is by Kris Bickell, who created www.debt-tips.com to help you learn how to find the right debt reduction program for your situation. If you’re considering bankruptcy, then learn the truth about debt settlement programs and find out if any of these is the right solution for your financial problems.

Blog Traffic Exchange Related Websites

Comments are closed.