5 Bad Spending Habits You Should Avoid At All Costs
Financial literacy is getting harder to learn especially if you did not grow up learning how to value it. You might bring your childhood spending habits with you as you grow older, and this could mean that you will be poor and broke. Here are some habits that you should break as soon as possible.
Just like everything else, you need a plan for your spending habits. You will not be able to save anything at all if you just wing it. Instead, you need a budget. You have to make it clear to yourself that you have money goals and that you will not reach any of those or buy anything you want if you do not stick to a budget.
A budget does not even have to be very rigid because money comes in and out easily. You also have to remember that it is a rule in economics that our resources are limited, while our wants are unlimited. You can start by earmarking a certain percentage of your cashflow and make sure that part of it really gets saved.
Having Every Cent Within Reach at All Times
You will not need all your money at all times. This is why ATMs are everywhere and your local bank has branches at every corner. You do not need to have all your money at your fingertips at all times. When you are headed to the grocery or to buy some new things, be sure to only take the cash that you need based on your budget.
This is the principle in which the piggy bank was made of. When you put some coins inside, it is a sin to touch the amount until the piggy bank is full. When you grow up, you no longer have a piggy bank to teach you discipline. Instead, you have to teach yourself to make an ideal budget and stick to it. To do this, let’s say you are going to do your groceries with a $100 budget. Withdraw that amount and leave everything else at home.
You Do Not Use Your Head
The heart has a mind of its own that our minds cannot control, but it can spell some really big disasters if you apply this principle to your spending habits. When you just go ahead and do what you want with your money, you will be terribly broke before you know it. You really have to use your head when it comes to spending your money and just going ahead with what your heart tells you is a terrible idea.
One situation could be that you are tempted to extend yourself on a mortgage so that you can finally get that house or that car that you have been dreaming of. It might sound romantic and all, but you will be barely scraping by each month.
You Do Not Care About the Little Things
Sometimes, we prefer convenience over cost savings. However, this means that your money is going nowhere if you just stop caring about the little additional charges that you could have avoided had you been aware and if you had a plan. For example, withdrawing from another bank that charges out of network ATM fees has been pretty normal. While this is convenient, you are throwing out a lot of money if this becomes a regular thing. This is why it is important to choose the bank that will be most convenient for you.
Another example would be entirely relying on bottled water for hydration. Water is a basic resource, thus you do not need to get your fix commercially. You will be amazed at how much you can save if you brought your own reusable bottle with you whenever you head out.
You Get Tempted Too Easily
Your credit card might have a new promo, or your favorite department store has a sale where you get a certain percentage off after spending some amount. This looks like a steal, but they are actually getting the best of you instead of the other way around. If you think 0% finance deals and those discounts are giveaways, you should have a word with yourself and step on your brakes at once.
An interest-free period will come to an end, and your will end up paying more since you are likely to purchase more. Of course, you can also use these to your advantage but then again, you need to stick to a budget.
These bad habits are more common than you think they are. However, if you break them, you get one step ahead of being financially free. Do you know any other terrible financial habits that should be broken? Share with us your thoughts in the comments below.
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