Finances are one of the largest stressors that people deal with on a daily basis, but money doesn’t have to be. By learning good strategies and changing the way you spend, you can minimize that stress—and stress about something else.
Of course, once you’ve indoctrinated bad habits, breaking them takes effort. That’s right, today we’ll ask you to do some work! However, the time and energy you put into altering your spending routine will reduce stress and make you more financially stable in the long run.
You can start your journey to monetary bliss (or at least responsibility) by identifying whether you have these habits and breaking them:
Financial Bad Habit: Paying Your Bills Late
You’re given a due date on all of your bills for a reason. If you fail to meet them, you’ll be charged extra. In some cases, you may pay an additional percentage of the original bill. You probably didn’t budget for fees, so paying them will put you back.
Not only will you get fees for paying after the due date, you can also hurt your credit score. Unfortunately, bad credit may prevent you from taking out a loan in the future—so much for your dream home! However, paying late isn’t all doom and gloom.
You can totally break the habit. Here’s how:
Check Your Due Dates: Always check the due date on your bills. If you can, pay them right away. Otherwise, decide when you’ll have the money (maybe when you get your next paycheck) and send the bill then. Circle the dates on your calendar in red, set a reminder on your phone. Do whatever it takes to adhere strictly to the due date.
Pay Bills Online: We get how writing a check can feel satisfying, but Internet payment systems are more efficiently and can be made automatic. Sign up for your service providers online payment system, or go through your bank.
Financial Bad Habit: You Don’t Pay Your Credit Card in Full
You know that minimum payment amount on your credit card bill? Forget about it! That nice low number is a trap to get you to pay more money. The longer it takes you to repay the entire balance, the more interest you’re shelling out.
The solution to this one is simple:
Pay In Full: Whenever you pay off your credit card debt (yes, your balance is debt), pay the entire balance before the due date. You should have the money to do so if you’ve stuck to your budget.
Of course, you might have overspent, in which case, consider creating a repayment plan. Pay off as much as you can each month to get that balance down quickly.
Financial Bad Habit: Impulse Spending
You’ve probably experienced this before: You’re out with your friends, intent on not breaking your budget, when you see that beautiful purse gleaming from across the room. You debate for about five seconds before giving in—you needed a new bag anyway, and it was on sale!
This kind of thinking can cause you to spend beyond what you planned. You have a budget for a reason. It tells you what you can afford to shell out on fun things (and bills) each month, allowing you to splurge without going broke.
However, you’re messing up the balance of your finances when you purchase something you did not intend to buy.
Plan Your Spending: Now, you don’t have to sit down and figure out which days you’ll buy coffee, but you should plan the larger things. Need new shoes for work? Take a look at your budget and decide which month will be the most conducive for doing so.
Leave the Plastic at Home: Going out and shopping with friends presents a dangerous temptation. If you tend to spend impulsively, try this strategy: Leave your credit and debit cards at home or in your car, and only take cash in the store with you.
The amount of cash you have should be based on your budget for that category. For instance, if you can spend $50 on clothes, bring that amount in cash in the store. You have to stop spending when you run out because you don’t have back up (i.e., your cards) with you.
Financial Bad Habit: You Don’t Track Your Spending
You may overspend if you have a poor idea of how much money you have and what you’ve already spent each month. You likely think you’re living within your means, but find yourself using your credit card at the end of the month to cover groceries and such.
This habit could cause you to rack up some credit card debt or dip into savings—neither is a good option. Here’s how to change:
Track Your Spending: Write down what you’ve spend after every shopping trip and subtract it from your monthly budget.
Get Some Help: There are tons of great budgeting apps out there to help, and many of them are completely free. They show you what you spend and help you make goals to stay within budget.
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