Whether it’s not working out, eating out way to much or procrastinating, we ALL have bad habits. We often accept our bad habits without thinking about how they may be roadblock to accomplishing our goals. Bad financial habits are roadblocks as well. When it comes to making the most of your money, consider curbing the following habits that may be taking a toll on your wallet.
1) Ignoring bills
Just because you don’t look at them doesn’t mean they don’t exist. Mail has an unfortunate way of piling up quickly. Take a few minutes each day to sort through your papers to make sure you don’t miss bills or other important paperwork. Setting up automatic payments through your bank or through your creditor can make this process easier.
2) Maxing out credit cards
The key to credit cards is to pay off the balance each month. You do not want to spend up your credit limit and just pay the minimum payment each month. Read your statements closely each month. Credit card providers are required to tell you how much you'll pay and how long it will take you to pay off your card if you only make minimum payments.
3) Not contributing to your 401(k) plan
Investing in your retirement plan is vital to your positive financial future. If you have an employer that matches contributions; make sure you take advantage of that match by investing the maximum amount. This is basically free money towards your personal savings.
4) Spending blindly
It is important to be aware of how much money you spend on a daily, weekly and monthly basis. Small purchases can add up very quickly if you are not tracking your spending every day. $10 each day eating out and buying coffee is $50 each week. That's $200 per month or $2400 per year! Don't think you spend that much? For one week, write down everything you spend. EVERYTHING. At the end of the week, add it up. Multiply that by 52 for an idea of how much blind spending you actually do.
5) Not having an emergency fund
It is important to save for emergencies. Emergencies WILL happen but they do not have to break the bank if you have a savings plan for them. Just finished paying off your car? Put the amount of your car payment in a savings account each month. When it's time for new brakes or new tires, you've already saved for them!