4 Bad Money Habits To Change
February 1, 2021
What are the bad money habits you need to change?
- Impulse buying
- Not budgeting
- Depending on credit cards
- Going for convenient purchases all the time
Even if you have the best intentions to spend money wisely, you can still find yourself getting into financial trouble. Most people with bad money habits end up paying too much for items and even have debts. From overspending on online shopping to not budgeting in the first place — here are some of the bad money habits you need to change and how you can turn things around. Read on.
Impulse Buying
Impulse buying is an unplanned purchase of a product or service, made just before a purchase. In a world heavily driven by online shopping, more and more people are leaning to impulse buying.
Impulse buyers don’t want to miss out on sales and deals. You might see an item and want to have it before thinking rationally about your spending.
To curb impulse buying, always think about if you need the item and if you have the extra money to spend. Before clicking that checkout page or heading to the cashier, give yourself time to think about your decision. Chances are you will realize you don’t need it after all.
Not Budgeting
If you don’t have a budget in place and know how to stick to it, you may find it challenging to stay afloat.
A budget serves as a guide on how much money you have and where it is going. It allows you to prioritize your spending and make the necessary changes to help you save more money.
Remember that budgeting does not have to be a big chore. You can simply start with carrying only a small amount of cash with you every day. Use the envelope budgeting system and put said money for paying bills systematically.
Depending on Credit Cards
Unless you can pay the balance in full every month, using credit cards can become one of the worst things you can do for your finances instead of being great financial tools. This is especially true if you are depending on credit cards to live above your means. To add to that, not paying credit cards in full means costing you more money from interest charges.
If you can’t make those purchases with cash in the first place, do not use your credit card. Do not end up paying a huge amount of money and not even remember making the purchases.
Going For Convenient Purchases All The Time
Every once in a while, a convenient purchase can be good. It can also be a necessity especially if you are in a rush. These are the purchases that are considered a routine and take little thought. However, if you find yourself constantly going for convenient purchases, it can cost you as well.
For example, there’s nothing wrong with grabbing fast food once in a while. But, you should consider learning to make bulk meals to eat throughout the week. This preparation will help in avoiding delivery meals or on days when you don’t want to cook.
In the same way, you can stop buying an expensive latte on the way to work and get up earlier to brew a cup at home. It is the little things that can significantly save you more money.
Key Takeaway
To attain financial freedom, one of the first things you should do is to avoid these bad money habits. Make smart money choices and consider starting small.
Think about if you really need the item in the first place. Budget your income and set aside funds for more important things. It is completely okay to skip that clothing piece on sale that you likely wouldn’t wear again or that expensive latte on the way to work.
For more financial and entrepreneurship pieces of advice, you can contact Benito Keh. As an experienced Filipino entrepreneur, he can help you develop smart money habits.