This week starts a article series on money habits. I recently wrote a post on how your financial education has a lot to do with making and saving money. In this two part series I will be showing some of the bad and good habits to ditch or live by.
Today’s post is about 10 money habits that you may or may not have and how to fix them.
- Don’t use your credit cards as an emergency fund. I believe this has always been a misunderstood use of credit cards. The reason being it’s to easy to have access to. Instead setup an account on a monthly draft payment. This way it’s out of site and out of mind. Here is a great post to check out where to set up your emergency fund at.
- Missing payments on your bills and debts. This is literally the kiss of death when it comes to keeping a good credit standing. Missing payments shows distrust to financial lending institutions, bank, or any other places that may look at your credit score. Instead pay off debts that have to be paid first before you spend on extra things.
- Pay more than the minimum payment on your credit cards. When your balance is high on your credit cards it’s easy to just pay the minimum so you can get by. The reason you shouldn’t pay the minimum is because it will take a lot of time and interest to pay off those credit cards. In fact if you are constantly adding to them the likelihood of you paying them off in never. Instead put a debt plan together and get out of debt the right way. Check this post out to learn how.
- Bouncing checks. This is a good way to upset a lot of people including your bank. If you can’t afford to pay someone don’t write a bad check and let them find out when it bounces. Instead talk to them and be up front and let them know you can’t pay them and that you will work with them so they get paid. It’s not worth destroying a relationship and your credit over a check.
- Pulling money out of your retirement accounts. Pulling money out of your retirement accounts to pay off debts or worse buy something you really don’t need can have a huge effect on your financial future. Instead leave it where it is and read this post on how it could effect your money if you took it out to early.
- Buying things on impulse. This can happen real easy. Someone you know tells you to buy something that has worked great for them and tell you to by it right now or you have the sales man at a local retail store who is telling you to buy now or you won’t get it at are new lower price. Instead take time to think it through. Research the product and decide if you really need it. Here is a great post about impulse buying.
- Buying what you can’t afford. Today people are buying bigger houses, bigger cars, and some are just trying to out do the other person. This is more commonly known as Keeping up with the Jones. Instead of buying the best stuff focus on buying the stuff you need and for the best value. In the end you will have something that everyone else doesn’t, MONEY!
- Keeping money to accessible. Having ways to access money for those just in case moments is one thing but having money easily accessible for those anytime moments is not O.K. Instead of using debit and credit cards for those times keep yourself a spending cash budget. For me I keep $50 a week back for spending cash. Set a specific amount back every week and spend wisely.
- Not looking at statements and bills. This one I’m sad to say I’ve even fallen prey to. You could be spending money you don’t even realize. Instead review all bills and statements to make sure you aren’t paying for thing you don’t want. Since I’ve been doing this I’ve saved myself around $160 a month.
- Buying things you don’t need. I saved this one for last because almost all of us do this. I know there are things that I would like to have but just don’t need. Instead place value between wants and needs buying only what you need to save money. Now you might be saying, what if I want to splurge just this once? Every once in a while is fine, all the time is not.
Know any other bad spending habits?
These are the bad spending habits I’ve dealt with in the past. Do you know of any others? Take time now and share them with everyone and leave a comment below.
Great work. I like it. Thanks.