When you want to get your finances back on track, trying to earn extra money can be one option. However, if you aren’t able to effectively manage your money, earning more may not be the solution you need – especially if you end up experiencing a drop in income at some point in the future.
Instead, a better idea can be to change your financial habits, helping you to become more fiscally responsible so you can make more permanent improvements to your overall financial standing.
Bad Financial Habits to Put a Stop to
1 – Paying your bills late.
Are you always behind on your bill payments? If so, you are spending a lot of extra money on late fees, and you may even be facing the possibility of interest rate hikes (as some creditors include this option in contracts after so many late or missed bill payments).
To break this bad financial habit, figure out why this is happening:
- Do you just have a hard time keeping track of when each bill is due? If so, get yourself on a payment schedule so you stop wasting money on late fees.
- Do you simply not have enough money to cover all of your bills on time? If this is the case, it may be time to start exploring some of your debt relief options.
2 – Buying everything on credit.
Do you use your credit card for everything? Or do you open up new lines of credit for new bigger purchases even when you may be able to afford them outright?
If so, this is another bad financial habit that could end up hurting you in a big way because it can:
- Cause your credit charges to snowball faster than you realize – In fact, studies have shown that people tend to spend more money when paying with credit than when they use cash.
- Result in you having too many lines of credit to be able to effectively manage.
So, put a stop to this bad financial habit by paying in cash when you can and saving up for larger purchases (and then buying them outright, rather than charging them).
3 – Not putting any money in savings.
If you aren’t regularly investing in your savings account – or if you don’t even have a savings account, you may be walking on a financial tightrope without a net.
The fact of the matter is that having a savings account can prevent you from spiraling into debt when larger, unexpected expenses arise. So, if you are able to, try to commit to investing at least $10 or $20 per month in your savings.
4 – Only making the minimum monthly payments on your debts.
Do you only ever make the minimum payments on your debts? If so, again, you may be wasting a lot of money that could go towards the principal of your debt, rather than the interest. In fact, if you are continuing to charge to these accounts, your minimum monthly payments will go up, and you’ll spend even more money on interest without ever chipping away at the principal.
So, do your best to pay more than the minimum monthly payment on at least one of your outstanding debts.
Bankruptcy Lawyers in Denver: Contact Garcia & Gonzales, P.C.
If you are finding that you have developed some of the above “bad” habits because you simply don’t have enough money to cover your debts, then it may be time to contact the experienced bankruptcy lawyers in Denver at Garcia & Gonzales, P.C. With more than 50 years of combined legal experience, our trusted lawyers have the legal knowledge, skills and insight you can rely on to help you:
- Figure out your best debt relief options.
- Favorably resolve your debt issues and obtain a financial fresh start.