15 Common Reasons People Overspend

Entitlement: Some people shop because they believe they deserve things, even if they don't have the money. The reasons someone might feel a sense of entitlement can be numerous. Maybe they were poor growing up, or they scrimped and scraped through college and now have their first job. Whatever the reason, feeling entitled to something you don't have the money for will cause a lot of financial distress.

Lack of knowledge: Some people simply don't understand how finances work. They believe that if they have qualified for a credit card with a $20,000 spending limit, then they can max it out. Not understanding the true costs of different financial instruments can have a huge negative effect on your finances.

Power: Some people spend money to feel powerful. Being able to carry around large amounts of cash and purchase expensive items on a credit card is a boost to their ego, even if they really don't have the money to pay for it.

Self-worth: Some people equate the things they buy with their self-worth. In order for them to feel good about themselves, they need to spend money, even if they don't have it.

These are just a few reasons behind overspending -- some people are motivated by a combination of several. Whatever your reasons, understanding the motivating forces behind overspending can help you address the issue and turn your financial life around.