Common Financial Habits That We All Need To Break

Improving your financial habits is a worthwhile venture, whatever stage of life you’re in. Giving you more money to save for a rainy day or to fund small treats, it’s always a good idea to get yourself into good habits early on.

Unfortunately, just about everyone has at least one bad financial habit. In fact, you might have several without even realising it. Breaking these habits could save you a small fortune and might be easier than you realise.

If you want to stay solvent, build up a rainy day fund and protect your future, here are some common bad financial habits you need to break.

Ignoring the household bills

When the mail lands on the door mat, do you open it? If yes, do you deal with any of the letters and bills immediately?

Failing to do so could be adding unnecessary stress and cost to your life. Paying the bills as soon as they come through the door or into your email inbox means you will never be faced with late payment penalties or have to worry about paying for everything at once.

Spending too much

It’s easy to get taken in by a fancy advert and spend too much money, but if you give in to temptation and splurge now then you could end up struggling in later life.

Research by Halifax suggests that people in their 40s and 50s actually have the most financial problems, so don’t think your money worries will be solved just by growing older.

Not budgeting

Following on from the point above; the main reason you spend too much money is because you don’t budget. It might seem like a waste of valuable time but if you know how much money comes in and goes out then you’ll know what you have left to play with.

If you’re in the red once you’ve deducted expenses from income, it’s time to start cutting costs.

Putting it on plastic

The credit card market is full of fantastic deals at the moment; from 0% on purchases to huge cashback rewards. There is nothing wrong with taking advantage of these deals, as long as you can afford to pay it all back.

Interest-free promotions will expire eventually and your balance will then be charged at the standard rate of interest – likely to be at least 18% APR.

Only paying minimum payments

If you do have a balance on a credit or store card, do you only pay the amount specified on the bill? If so, it could be costing you. The minimum payment is exactly that, the minimum required. Paying just £10 more a month could save you hundreds or even thousands of pounds depending on how much you owe.

Having kids

It is essential that you think about the financial impact of starting a family before having children. According to LV, the cost of raising a child until they’re 18 years old is a staggering £222,458.

That’s not to say you shouldn’t have children, but you need to be confident that you’re able to support them.

Jennifer Fleming is half way through a three year degree at the University of Liverpool. In her spare time she’s an avid bargain hunter and a part time blogger for Vita Buy Student Accommodation.

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