Somewhere along the line, we all have made poor decisions with our finances. Whether they’re big or little mistakes, they can be frustrating and take some time to bounce back from.
You may not even be aware you’re making a mistake until it’s actually impacting you, so here’s a list of common ones to look out for.
1. Trying to Live Someone Else’s Life
It seems that everyone is in competition with each other, so it’s no surprise that mistakes often begin when trying to keep up with friends or family. Wealth and status matter to many, but trying to match lifestyle and possessions can quickly lead to financial hardship. A better idea is to create a lifestyle that fits YOU and take control of your spending through carefully analyzing and reducing your spending.
2. Little Indulgences You Rationalize
Just because something is cheap, doesn’t mean you should buy it. And cheap purchases add up quickly. Even if it is just $5 a day or a few times a week. In order to avoid these treats that you give yourself, track your spending each week. It is good to treat yourself once in a while, but it becomes costly when you make it a habit.
3. Forgetting Subscriptions
Have you signed up for monthly subscriptions? Companies make a good amount of their money off of people who forget about their subscriptions and do not cancel them. As a result, they continue to pay for what they’re not even using. Be sure to read your bills carefully each month to check for fees and services you are not using, and check any subscriptions you may have forgotten about.
4. No Emergency Fund
If you do not have an emergency fund in some capacity set up, you are setting yourself up for financial hardship. It is important to create this fund and make sure that you have enough emergency money to cover any unexpected expenses (usually a car repair or health expense). In order to successfully add to this fund, treat it like another bill and contribute as much as you can to it each month, even if it is only a few dollars. It will quickly add up.
5. Check Your Bank Fees
You may be getting hit with overdraft fees, out-of-network ATM fees and checking account maintenance fees. However, these things can be avoided once you become aware of them. In order to avoid these fees, keep a nice cash cushion in your accounts to avoid overdraft fees or switch to a bank with free checking. Sign up for electronic alerts for when you are hit with fees and avoid out-of-network ATMs.
Determine what mistakes you’re making and get on track to saving your money!