Which one of your financial habits do you wish you could break? We all have habits we have developed over time. Some habits we develop prevent us from living the financial life we desire or reaching the financial goals we set.
Here are 8 financial habits you must break in order to help you achieve your financial goals and objectives as well as begin to live a simplified financial lifestyle.
Bad habit #1 Not creating a monthly budget – You must know where your money comes from and where your money is spent on a monthly basis. This way your not wondering at the end of the month where did my money go or why I do not have any money left at the end of the month to save.
Bad habit #2 Not creating an emergency fund – You just never know when financial emergency will occur. By not having an emergency fund you can set yourself up for financial disaster.
Bad habit #3 Making only the minimum credit card payment – If you want to get out of financial debt and your only making the minimum payment you will never get out of debt. You might as well just stop using your credit card if you can not make more than the minimum monthly payment.
Bad habit #4 Paying your bills late – If you find yourself always incurring late fees every month, you need to look to see why your incurring these fees. Paying your bills late can significantly impact your credit score which can impact your ability to borrow money or increase your cost to borrow money.
Bad habit #5 Using store credit cards - If you sign up for those store credit cards just to receive the 10% to 20% discount on your recent purchase, is it really worth the money you save in the long run. These credit cards usually have high interest rates and most can only be used at that individual store. Its also one more bill to keep track of and one more bill to pay at the end of the month. Just say no to those store credit card offers.
Bad habit #6 Not checking your credit report regularly – Most of us only check our credit report usually when we are going to make a large purchase such as house or car if you even check it then. Many times we don’t look at our credit reports unless there is a problem such as we were denied credit because of an issue on our credit report and then find out it was a mistake. If you check your credit report at least annually you can prevent these issues from arising. Know where you stand when applying for credit so your able to dispute any discrepancies prior to making an application for credit.
Bad habit #7 Living for today only – Many times we only live for today not for our future. How we spend and what you save impacts how we will live in the future. We don’t know what the future holds but we can help predict your future a little better by planning for it and taking action now. Not saving for retirement today will impact you later in life. You look back and say if I only would have saved a little more I could be living a better life. You must plan for your future financial life so it can be better or just as good as the life your living now.
Bad Habit #8 Stop trying to be a financial do-it-yourselfer – We all have the Home Depot mentality. I can do it and save myself some money or I can do it better than the expert. Think about how much time will you spend trying to learn the new tax laws or researching stocks to add to your portfolio. Hire the expert you will save time and money by letting the expert handle your specific financial task.
What are some other financial habits you have that you would like to break to help simplify your financial life?