7 Bad Financial Habits to Break Before It's Too Late

Maintaining bad or irresponsible financial habits is one of the worst things you can do for your budget. Not only can poor management of your money prevent you from achieving your financial goals, but it can also sink you into debt and grossly impact your bank account depending on the severity.


Just like maintaining your physical health, if you wish to preserve or build financial health, you’ll need to change any bad practices you have. While some revisions may be difficult, they’re worth it and may contribute to your financial well-being. Below are 7 bad financial habits you should break today.

1. Using credit cards you can’t pay off at the end of the month.

Credit cards can be useful if they are managed wisely. They help build your credit history for use with larger purchases and other lines of credit, and you can build up rewards for use towards other purchases. If you misuse credit cards, however, by making purchases you cannot pay off and always retaining a balance, they quickly wear out their usefulness and become a financial burden.

2. Ignoring your budget.

Budgets are set for a reason: to keep your spending in check and propel you towards your financial goals. If you treat your budget as more of a guideline, however, and still allow yourself to conduct non-emergency spending outside of your limits, it won’t work. Your budget can be your best financial tool, but you must be disciplined.

3. Thinking you can’t save.

It’s easy to subscribe to the notion that there’s no room in your finances to save. Don’t do this. There are always tweaks and changes you can make to your spending habits and bills to reduce your overhead and start making progress with your savings goals.

4. Overpaying.

Consumers often make the mistake of overpaying for goods and services because they choose convenience over price or don’t take the time to search for a better deal or coupon. Patience is your best friend when shopping. If it’s not an emergency, don’t feel the need to make an immediate decision. Instead, take the time to shop around and price compare.

5. Not planning for emergencies.

Emergencies are a part of life, and if you’re not prepared financially, one event can cause some severe damage. Set up a savings account for your emergency fund and contribute as much as you can regularly. You’ll be happy you have this cushion when you need it.

6. Living outside of your means.

You work hard for the life you have, and the quality of that life is important. However, make sure your lifestyle isn’t taking more out of the bank than you’re putting into it. It’s important to live within your means; otherwise, you could be heading down a dangerous financial road. Also, never use credit cards to make non-essential purchases you can’t afford to pay in full.

7. Paying the minimum on your credit cards.

It’s not a good idea to be in the habit of only paying the minimum required amount on your credit card bills, primarily if you are still utilizing your credit cards. Not paying more than the minimum puts you in a position of spending a lot more in interest, not to mention paying off your balances will take much longer. If you don’t feel that you can pay more than the minimum, look at your budget and see where you might be able to make some cuts. Making an uncomfortable change in your budget now to prioritize paying off your credit cards will free up more money for you in the future.

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