Many look at their bank statements and wonder what happened to all of their money. Financial advisors understand very clearly that the biggest problem a client faces is their own bad habits. Though most people mean well with their finances, overspending can be a difficult habit to kick. The most important step in learning how to stop overspending is to become conscious of the ways you continue to spend without thinking. Below are five things that may be costing you big money over time:

Credit Cards:

Credit cards are designed to make people feel as though they have more spending power than they actually do. This mind-frame alone makes having a credit card a big danger for those trying to spend less. The simple act of swiping a card is easier on a guilty conscience than counting a stack of cash. After getting rid of your credit card, you may find that the act of using an ATM to withdraw physical cash is enough to lower your spending substantially.

Peer Pressure:

Buying a new pair of shoes or even a car because a friend has is something not many are willing to admit; however, there is little doubt that most have experienced this to some degree. If your friends always want to eat at high-end restaurants or shop at expensive stores, you may want to reconsider who you spend time with. More importantly, ask yourself whether a true friend should make you feel compelled to spend money more money than you should. Even friends with the best intentions can negatively influence you financially. Awareness of a friend’s power is the best weapon you can have.

Unhappiness:

Studies show that the more anxious or stressed you become, the more likely you are to overspend. While shopping has been shown to temporarily make us happier, in the long-term it tends to trap people in a cycle of financial self-destruction. Awareness of yourself and why you are truly spending is the best weapon anyone can have in combating this issue. Develop cost-free ways of feeling more fulfilled so that you can begin to only spend on necessities.

Gifts:

Scientists who study what makes us happy have learned that buying things for other people does make us feel better about ourselves. However, when it comes to finances, there is a big difference between supporting a child’s education or buying a modest birthday gift, and over-indulging. Whether it is a spouse we want to romance or a child begging for a new toy, saying no to ourselves and others can be difficult. Try taking the time to establish financial priorities with your spouse and children in a way that creates a healthy and sustainable dialogue.

Subscriptions:

Many falsely see the monthly phone and cable bills as necessities that must be purchased. However, these expenses have only recently become the norm. Ask yourself how often you truly make a phone call, could you simply use Wi-Fi to send texts? Perhaps cancelling your cable subscription in favor of reading more books could be the best way to save money this year.