How to Stop Overspending

Why Overspending Happens

Before we tackle how to stop it, it’s worth understanding why it happens. In the UK, contactless payments and easy credit options can make spending feel effortless — and sometimes invisible. A mix of emotional triggers, lifestyle pressure, and poor tracking are often behind overspending habits.

Common reasons include:

• Emotional spending: Using shopping to lift your mood or reward yourself.

• Lifestyle inflation: Upgrading spending as your income grows instead of saving more.

• Lack of budgeting: Not tracking where your money actually goes.

• Marketing influences: Constant promotions and “limited time offers” tempting you to spend.

Recognising which of these affect you is the first step to breaking the pattern.

Step 1: Track Where Your Money Goes

You can’t fix what you can’t see. Start by tracking every pound you spend for a month. This gives you a clear picture of your spending habits and helps you identify problem areas.

Here’s how to do it:

1. Check your bank statements for the past month (or longer, if possible).

2. Categorise each expense — essentials like rent, transport, food, and non-essentials like takeaways or subscriptions.

3. Use a budget tracking tool or spreadsheet to make it easier. If you don’t already have one, try our Next Steps budget template — it’s designed for UK users and helps you see where your money really goes.

Tracking your spending might feel tedious at first, but it’s one of the most powerful money habits you can build.

Step 2: Identify Your Spending Triggers

Overspending often happens when you’re not thinking about money at all — which is why understanding your triggers is vital.

Ask yourself:

• Do I spend more when I’m stressed or bored?

• Am I swayed by social media purchases or sales emails?

• Does convenience lead me to pay extra (e.g. food delivery, taxis)?

Once you spot your triggers, put barriers in place. If online shopping is your weak spot, delete saved card details from your browsers. If you overspend socially, set a weekly “fun money” limit and stick to it.

Even small changes — like unsubscribing from marketing emails — can dramatically reduce temptation.

Step 3: Create a Realistic Budget You’ll Actually Use

A budget isn’t a restriction; it’s a tool for freedom. Budgeting helps you decide consciously how to spend your money, rather than wondering where it disappeared.

To create a realistic budget:

1. Start with your net income.

2. Allocate money to essentials — housing, utilities, food, and transport.

3. Set aside amounts for savings, debt repayment, and flexible spending.

4. Review and adjust monthly based on your actual spending habits.

If you need help building a budget that fits your lifestyle, use our step-by-step budgeting guide to get started. It includes a template and tips for keeping your budget practical, not restrictive.

The key is to make your budget flexible enough that it works in real life, so you’ll actually stick to it.

Step 4: Use the “24-Hour Rule” for Impulse Spending

Impulse buying is one of the fastest ways to blow your budget. The “24-hour rule” is a simple but powerful trick: if you see something you want that’s not essential, wait 24 hours before buying it.

Often, you’ll find that the urge passes — and if it doesn’t, you can revisit the purchase knowing it’s a genuine need, not an impulse.

Try keeping a “wishlist” of things you want to buy. Revisit it at the end of each week and see what still feels worth it. It’s a budget-friendly way to avoid regret purchases.

Step 5: Go Cash or Use Separate Accounts

For many people, contactless payments make spending almost invisible. If this sounds familiar, try switching to cash for certain spending categories, such as groceries or leisure.

Alternatively, set up a separate spending account for your discretionary money. Once it’s gone, it’s gone — forcing you to be more mindful.

Many UK banks, such as Monzo or Revolut, allow you to create “pots” or “pockets” to separate funds automatically. This visual separation can make sticking to limits far easier.

Step 6: Set Short-Term Financial Goals

Having clear goals gives your money purpose — and makes overspending less tempting. Examples include:

• Paying off your credit card balance within six months.

• Building a £1,000 emergency fund.

• Saving for a holiday without using credit.

Once your goals are visible, you can track progress and remind yourself what you’re working towards each time you’re tempted to overspend.

You might also want to set automated transfers on payday to move money straight into savings. Out of sight, out of mind — and out of reach for impulse spending.

Step 7: Review, Adjust, and Celebrate Progress

Stopping overspending isn’t about perfection; it’s about progress. Check in with your spending every month, see what’s working, and adjust what isn’t.

If you’ve stayed within your limits or hit a savings goal, allow yourself a small, planned treat. Positive reinforcement helps make good habits stick.

Where to Get Extra Help if You’re Struggling

If overspending has led to debt or financial stress, remember — you’re not alone, and free help is available. Services like StepChange and National Debtline offer confidential advice tailored to your situation.

Final Thoughts

Stopping overspending isn’t about cutting out all enjoyment — it’s about creating a balance that lets you enjoy your money and build a secure future. By tracking spending, identifying triggers, setting a realistic budget, and using practical rules like the 24-hour pause, you put yourself back in control.

Remember, your next step starts today. Take 10 minutes to review your spending and use our Next Steps budget template to map out where your money should go next month. Small, consistent actions are what lead to lasting financial confidence.