We're back in debt again. Americans racked up nearly $48 billion in new credit card debt in 2011; that's up 424 percent from what people charged in 2010 and a whopping 577 percent more than in 2009.
Is it proof that Americans are back to their old overspending habits? In Your Money Matters, we look at five reasons why people spend more than they make.
Spend, spend, spend--despite the recession, it seems to be the American way.
"We're a very consumer-driven culture. We like to go out and spend to keep up with the Joneses," Marley Prunty-Lara said.
Reasons for Overspending: Peer Pressure
There are typically five reasons why people overspend. The first is peer pressure. Your friends are spending money on something, but you really can't afford to go along with it.
"Adults fall into the same pitfalls as their kids do. It's not to say everyone is like that. You do want to be able to match your culture and that's a consideration when people want to spend a little more," Prunty-Lara said.
Reasons for Overspending: Want to Feel Good Now
Another reason people overspend is for instant gratification, or wanting to reward yourself because you are under stress.
"Maybe it is, I deserve it, or I've really earned this. But you have to say too, 'Do I need it now? Is this something I'm going to need tomorrow? Can I wait?'" Prunty-Lara said.
Reasons for Overspending: Ignore or Neglect Financial Goals
People may also overspend because they don't have any financial goals or they lose sight of them.
"Once you have a goal in mind, whether that's three months, six months; maybe your goal is to buy a house. Then you can start shaping your spending to achieve that goal," Prunty-Lara said.
Reasons for Overspending: Keeping up with the Joneses
From designer clothes to flat screen TVs, keeping up with neighbors or friends is another reason people overspend. Some blame the entire mortgage crisis on people living in homes they couldn't afford to keep up with their friends.
"We really have to acknowledge that it's not so much about what we have. It's about the people and relationships and things we can add to our lives. Whether or not we have the most expensive purse or car or have fanciest belongings in our house-is that something that adds that much value to our life or is it an experience or something we do with our kids," Prunty-Lara said.
Reasons for Overspending: Addictive Spending
Some people get a high off gambling or drinking, while others get a high when they buy something new.
"You're waiting for the next time you can spend, almost like gambling and you're waiting for that. People do get to that point. That's certainly a time you need to seek help," Prunty-Lara said.
If you want to look at exactly how much you are spending, we've put a link to an online calculator.