15 Alarming Signs You’re Spending Too Much on Your Life

Beware these subtle hints that your budget needs a rescue mission.

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Updated June 6, 2024
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You may not realize it yet, but there could already be signs that you’re living beyond your means.

Perhaps you’re struggling to figure out where your money goes every month or to move beyond living paycheck to paycheck. These might be signs you’re spending more than you make.

If you’re worried about spending too much, here are 15 signs you’re going down the wrong financial path.

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You always have credit card debt

Pormezz/Adobe Woman reviewing bills while holding cards

One sign that you may be spending too much is if you pay the minimum each month on your credit card while the rest of your debt accumulates from month to month.

It's better to pay in full each month, so curb your spending only to what you can afford to pay off on each billing statement.

Pro tip: One way you can try to slow down your credit card spending is to limit your purchases to cash only to make it harder to overspend and rack up debt.

You base your budget on your salary

fizkes/Aadobe Woman calculating budget

It can be a good idea to have a budget and plan your spending based on how much you earn each month.

But you might not realize you’re falling short because you aren’t accounting for taxes and other expenses before your paycheck hits your bank account.

Make sure there are line items on your budget for state and federal taxes, employment taxes such as Social Security, and pre-tax withdrawals such as money for your employer’s 401(k).

You have no idea how much you spend each month

Wayhome Studio/Adobe Woman in open kitchen reviewing bill

Do you end each month wondering where your money went?

A great way to keep better tabs on your spending is to create a budget to help you track each item you spend money on.

You can figure out places where you’re spending too much each month or find spots that can help you save cash instead of wasting it.

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You can’t afford to save money

KMPZZZ/stock.adobe.com A hand puts coins into a piggy bank.

Saving money can be a great way to pay for a short-term goal, like a vacation or something you want. It can also go toward long-term goals like buying a house or retiring early.

But ending the month without money to save for goals could signify that it’s time to rethink your spending habits.

You’re constantly paying bills late

JustLife/Adobe Sad couple reviewing bills at home

Are you missing due dates on everything from credit cards to rent? You could’ve even had your utilities shut off because you forgot to pay a bill.

Paying a bill late can signal you’re spending too much on everyday things. And like other overdue bills on this list, any late fees or delayed bills could hurt your bank account and your credit score.

You don’t have an emergency fund

Vitalii Vodolazskyi/Adobe Glass jar full of money with emergency fund sticky note label

You need an emergency fund for surprise expenses such as a car accident, health issues, or major home repairs.

You might have to rely on credit cards to pay for those issues without an emergency fund, which could sink you further into a spending hole.

You buy a new car every three years

Flamingo Images/Adobe Friends driving in a car

Buying a new car every few years can be a great status symbol, but it could also be a big-ticket purchase you don’t need.

Instead, check with a car dealer to see if you can sign up for a lease-to-own deal that will allow you to buy a car outright when you’re done paying the monthly payments.

Pro tip: Don’t forget about other costs associated with your car, such as maintenance, repairs, car insurance, gas, and other items that can add to the expenses of car ownership.

Your net worth is negative

deagreez/Adobe Man frustrated looking at computer

Sit down and list everything you have and everything you owe. You’ll want to include assets like your savings account, home equity (home value minus mortgage remaining), and debts like credit cards or auto loans.

It may be a bad sign if you owe more money than what you own.

You don’t enjoy spending money

Krakenimages.com/Adobe Worried senior couple in retail store holding card and shopping bags

Yes, no one enjoys spending money, especially on things they need. But it may be a bad sign if you dread spending money on things you want and do it anyway, even though you know you can’t afford it, and it will put you deeper into debt.

It’s OK to live life and enjoy spending money on new clothes or something for your home. But if you’re spending just to spend, try to step back and take a breath before you make that purchase.

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Your mental health is suffering

Ilona/Adobe Sad couple after argument at home

You may be living above your means if you get worried every time the phone rings and you think it’s a debt collector, or you just toss your bills in a corner so you don’t have to think about them.

Taking control of your spending can also help you take control of your mental health. Find time to sit down and see what you need to do to get your mental and financial health in order.

You’re spending too much on housing

JacobLund/Adobe couple moving in new house

A general rule is that you shouldn't spend more than 30% of your income on housing.

That can be tough if you live in a city with a high cost of living and even harder if you’re spending above your means for housing.

It’s a big-ticket item that can take a chunk of your monthly income, so consider downsizing or relocating to save some money and stick within your budget.

You aren’t committed to financial goals

baranq/Adobe Young woman paying bills using laptop

Goals can be great motivators when it comes to helping you achieve financial success, such as saving a certain amount of money for a home or putting aside enough to retire at a certain age.

But it can be a red flag if you can’t reach goals because you overspend. It can also be a red flag if you can’t even come up with a goal because you’re living beyond your means.

You’re trying to impress others

NDABCREATIVITY/Adobe Two women shopping on vacation

Your friends may think your new shoes or car are signs of your success, but those could hide your overspending issues.

You need to focus on your spending and what you can and can’t afford. Going beyond your spending limits just to impress others will sink your financial well-being.

You have a low credit score

wirojsid/Adobe poor credit score report on table

Your credit score contains five components: payment history, amounts owed, length of credit history, new credit, and credit mix.

A low credit score can be a sign you’re spending too much. It could also hurt you later on as you apply for loans.

You’re too generous

Jose Calsina/Adobe Woman paying bill with a contactless credit card in a restaurant

You may think it’s OK to loan money to friends even though you know they won’t pay it back or give extra cash to your struggling family members.

But you need to remember to pay yourself first and prioritize your own financial needs over others.

Before you’re kind to others, be kind to yourself and worry about your budget instead of overspending on someone else.

Bottom line

A. Frank/peopleimages.com/Adobe Couple using laptop for reviewing budget

So just how much are you living beyond your means?

Remember that it’s not too late to start fixing your financial life so you can grow your wealth. It’s important to make a budget now so you have a better idea about your spending habits.

You may find that a budget can help if you’re struggling financially or perhaps even allow you to start saving money with a high-yield savings account instead of spending beyond your means.

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Author Details

Jenny Cohen

Jenny Cohen is a freelance writer who has covered a bit of everything, from finance to sports to her favorite TV shows. Her work has been featured in The Wall Street Journal, USA Today, and FoxSports.com.