Simple Tips to Curb Your Spending Habits and Avoid Overdraft Fees

May, 17 2020

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It's always a good time to think about ways to save money. When facing a potential economic recession though, curbing your spending habits becomes a necessity rather than something to simply ponder.


But thinking about budgeting when you don't have much money coming in can feel challenging. However, a change in your habits could help you realize you have more money than you thought! It's just a matter of redirecting your cash to your most critical needs and reducing the spending that seems to make your money disappear. 

When you spend more money than you have in your checking account, you can accrue overdraft fees. It's an expensive spiral that you can break by adopting simple tips to stop spending money. Here are our recommendations to curb your spending.

1. Reduce Subscription Services

Have you taken stock of your monthly subscriptions lately? Every media, entertainment or luxury subscription can add up to significant spending. So, canceling or pausing subscriptions to help get your finances in order can amount to substantial savings!

Review your automatic payments. Many of these subscriptions or regular payments hit your accounts each month without you remembering that it's happening. Check your bank account and credit card statements to identify recurring services, then ask:

  • Are you using this service? 
  • Do you need to continue using this service? 

Anything that's not critical is an option for cancellation or pausing payments until your income supports the monthly fee again. Consider cutting back these types of subscription payments:

  • Streaming services (music, video, premium channels, gaming, etc.)
  • Club memberships (gyms, tanning, massages, etc.)
  • Subscription shopping services (meal kits, clothing, pet supplies, etc.)

We're not suggesting that you give up exercise, all forms of entertainment, or do without essential items. However, it's a good idea to take an inventory of your subscription services and make sure you use them. If you can do without them for a while, you'll save money by pausing the subscriptions.

2. Reduce Your Energy Consumption

Your energy bills can be one of your biggest expenses. What are you doing to be a conservative energy user? Scaling back your energy use at home can cut your electric and utility bills by doing things like:

  • Turn off lights in rooms you aren't using
  • Adjust the thermostat up or down a few degrees to save on heating and cooling costs
  • Swap standard lightbulbs for LED bulbs
  • Reduce how much you water your lawn
  • Install low-flow shower heads and faucets
  • Use ceiling fans to move air throughout your home

Being mindful of how you use electricity, gas, and water can help you find ways to save energy and money.

3. Eat at Home

Eating out or ordering in can quickly become an expensive habit. It's about five times more expensive to eat at a restaurant or order take out than it is to cook a meal at home. 

You don't have to be a master chef to benefit from tasty meals and money saved from home-cooked food. Start with a few simple recipes to create your favorite meals. Save a restaurant meal or ordering in for special occasions and keep those treats to a minimum. 

You might be surprised at how easy and fun it can be to cook at home. You'll also enjoy having more money in your bank account.

4. Cut Back on Entertainment Expenses

How often do you go out with friends, attend concerts, go to movies, or spend money on activities outside of your home? While engaging in social activities and spending time with friends and loved ones is essential, entertainment costs can add up. 

You don't have to restrict your activities forever but finding ways to stay entertained and connected to your circle of friends and family without overspending can boost your savings. When you redirect entertainment funds toward paying off essential bills, you'll find you can stretch your income further for things that really matter. 

Try moving regular activities at bars or restaurants home to your house or a friend's house. Encourage friends and family to cook with each other and get together for an at-home game night or movie night. You don't have to give up the people in your life but adjusting how and where you spend time together can help everyone save and focus their money on paying bills or reducing debt. 

5. Earn Extra Cash

Are you using your spare time wisely? If you're suffering from income loss or living paycheck to paycheck, picking up a side gig or additional work outside of your day job can help you earn more money. 

You don't have to do it forever, but in a recession, it can be a big help to generate income in new ways. If you're not sure where to start, use our Income Helper to find something that fits your skills and your schedule. You never know when a side hustle or that "extra" job could turn into something lucrative that you enjoy.

Live Within Your Means

Cutting back on "extra" expenses and living within your means is an excellent financial practice —whether we're experiencing a recession or not. If you can learn how to stop spending money and live within the amount of money you earn through your work, you develop life-long budgeting habits that can help you through difficult financial times. 

Develop Your Skills to Stop Spending Money 

Learning to stop spending money can be challenging. However, if you follow these tips and commit to living within your means, you'll enjoy making your dollars stretch further for the things that really matter.

With a little effort here and there, you might be surprised how much you can save without sacrificing very much until you can boost your savings and get back on track.

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