Once you pick up a habit then it is not very easy to change it, especially the bad ones. Habits become our daily routine. We tend to ignore the effects until it shatters us completely, that is, in situations involving small sums of money. One fine day when this same habit leads to a major catastrophe in business is when people wake up,but by then it is too late. The damage done will be irreparable.
To avoid facing such a situation in your workplace or home, get rid of these 10 bad money habits first.
Having no savings
One of the main reasons why the American economy went into depression was that people had no savings at all. They were living off of credits only. Once the economy collapsed, they had no savings to go to. Hence, instead of spending money mindlessly start saving up. Open up a savings account and earn interest on your savings.
You might be under the impression that making late payments includes only fines that need to be paid over and above the actual expense. But you are wrong because not only do you have to pay the extra fine but making late payment adds up in your credit score in a negative section, one which you do not want to have in your financial report.
It is alright to be optimistic but it is also foolish to be impractical and not have an insurance since most of the time it is medical expenses that bankrupts people.
Delaying retirement plan
Keep in mind the minus 10 rule according to which if you are in your twenties then you need to save up to 10% of your earnings for a secure retirement at 65. The numbers only increase with the age. In your thirties it becomes 20% of your savings and by the time you are forty it becomes nearly one third of your income. So it is not wise to put off retirement plans.
Every month you are paying the subscription cost for a magazine that you don’t even glance. Stop paying for such unnecessary subscriptions and cut your expenses.
If you are spending equal to what you earn or even more than that then you need to stop right now. Buying things on EMIs and taking loans for getting a jacuzzi in your bathroom is not the kind of habit you want to put on. It will cost you dearly in future.
Saving the “leftover”
What most people do when they receive their paycheck is pay the rent, pay the electricity and phone bills and save whatever is left of it. Prioritize saving. Keep a fixed amount of money aside first and manage from the rest.
Forgetting about the savings
It is good to have multiple accounts to save money but at the same time do not forget to a keep a proper record of them.
Using your savings
There is no point in saving if you keep spending from it. Once you have started to save then keep your hands off of it.
Eating out everyday
There are places where you can save money. This is like getting rid of unnecessary subscriptions. You do not need to eat out everyday. Take lunch from home. It will be light on your stomach and wallet both.