Small money mistakes can add up to some really bad money habits. Getting these under control can stop you from wrecking your finances.
Bad Money Habits And How To Break Them
Having bad money habits is no joke. They can make you poor, ruin your finances, and get you into big debt.
The funny thing is, we often don’t even realize we are doing them.
Having poor money habits isn’t always super obvious to us. We live day to day without ever really thinking about them and the next thing you know, we are in a ton of debt and have no idea how we got there.
You know what I’m talking about.
I always have excuses for things I ‘need’ when in reality, they are WANTS not NEEDS.
And if I ever wanted to get out of debt, stop living paycheck to paycheck, and actually build a little wealth… I had to break my bad money habits once and for all.
Toxic Money Habits That Make You Poor
Ready to get rid of your debt and actually have some extra money? Here are 8 bad money habits you need to break now…
1 – Spending without thinking
This is where most of us get into trouble. We buy things based on emotions and not with our brains.
We don’t buy a new pair of shoes because our current ones are worn out. We buy a new pair because we want a different style or color. So we purchase items without really thinking if it’s necessary or not.
In order to curb this, I give myself a 2 week period when I really want to buy something. In those 2 weeks, I see if I really need it or if I find that it isn’t necessary.
Any more times than not, I end up not purchasing the items after 2 weeks.
2 – You don’t save money
One of the worst money habits you can have is not saving money. And I’m not just talking about having a savings account (which is extremely important).
I’m talking about not taking advantage of saving money when it’s possible.
Do you take full advantage of your company’s matched 401K (because you’re turning away free money if you don’t)?
Do you use coupons or take advantage of sales?
Having an emergency savings account is a financial necessity. But learning how to save money in other aspects of your life is just as important.
3 – Not having a budget
One bad money habit that you need to break is not having a budget. You can’t get anymore money-dumb than that.
Not having a budget lets you blow money left and right. And if you have no record of it, you don’t even know what you spent it on.
If you want to be financially smart or have any chance of getting out of debt, you NEED to have a budget.
You will get nowhere with your debt without a budget.
Keep Reading: How To Easily Create a Budget In 5 Steps
4 – You are a subscription addict
Subscriptions are what get us in toruble when it comes to our budget. Mostly because they seem so innocent. $10 a month here, $17 a mother there… it doenst seem like much.
But added up over a year and it comes out to a pretty signiciant amount.
And with reoccurring monthly paymemts that slip money out of your account without you noticing, it’s easy to spend money you dont even know youre spending.
When I sat down to total up all those small monthly subscriptions I had (literally none of them were over $17) the total came out to about $250 a month.
I almost peed my pants when I realized I was paying that every month for things I didn’t even use all the time.
5 – You have no money saved
It shocks me when I meet people who have no money in savings. One small thing goes wrong in your life and where do you turn? Your credit cards… that’s where.
And once you start that cycle, you never get out.
Do yourself a favor and SAVE MONEY. Go on a spending freeze or get a second job. Do whatever you have to do to have a decent amount in a savings account.
6 – You don’t pay your bills correctly
One bad money habit a lot of people have is not knowing how to pay their bills corrently.
Not paying your bills correctly refers to what bills you pay off and how you do that.
Only paying the minimum payments on your credit cards is one big money mistake. Another is not paying attention to interest rates and throwing your money down the drain.
Are you using credit cards for all your purchases? That’s great… but only if you plan on paying it off every month.
7 – Living beyond your means
There is no better way to get in trouble with your finances than living beyond your means.
I don’t know what it is that makes people think they are entitled to certain things in life but they don’t have to earn it first.
Just because you own a car doenst mean you get to drive as fast as you want.
Just like having a credit card doesn’t mean you get to buy whatever you want either. Don’t ever buy something you don’t already have the money for. The ONLY time I ever use credit cards is when I want to build points for free airfare.
Keep Reading: How To Live Within Your Means without Being Deprived
8 – You make excuses!
You know you have bad money habits when you constanlty make excuses for your finances.
“I don’t make enough money.”
“I REALLY needed this.”
“I couldn’t help it that my friend was getting married and I had to pay of a dress”
We can make any excuses we want for spending money we don’t have. But at the end of the day, it just means we were not prepared for these events.