Everyone has likely mismanaged money at some point in their lives. While small things or one-time circumstances can quickly be overcome, larger mistakes and habits can lead to financial disaster. If your finances have started to stress you out, become more than you can handle, or hinder you from accomplishing things in life it’s necessary to make a change. You can start, by quitting some of these bad money management practices listed below:
Making Late Payments
Due dates are provided on bills for a reason. Though most companies will give you a grace period, if you don’t make the payment in time, you’re wasting money on late fees and ruining your credit in the process.
If you’re having trouble with paying on the due date, talk with the company to find out if you can change the date. You might also start paying the bills weekly or bi-weekly so that you don’t have to pay the total balance due all at once.
Not Repaying Loans
Whether you take out a mortgage, student loan, business loan, or cash advances for individuals with bad credit, it is important to repay your loans. Many consumers take on the responsibility of borrowing the money but don’t follow-through when it’s time to pay up. This results in late fees, penalties, ruined credit, and in extreme cases, wage garnishment, income tax withholding, and more.
Pay your loans in full. There are a lot of programs out there for borrowers that may be struggling that you should take advantage of. You can also contact your loan provider and let them know you’re having a hard time. They may be willing to work with you and save you a lot of money on fees, interests, and other adverse actions.
Not Considering Banking Fees
Having an account where you can keep your cash is convenient. However, it could end up costing you if you’re not paying attention to the associated banking fees. Out-of-network ATM charges, insufficient funds fees, and even monthly maintenance fees can add up.
Review fees associated with your account so you can avoid them at all costs. Go to ATMs in the network, make sure that funds are available before setting up payments, and perhaps invest in services like overdraft protection.
Waiting to Save for Retirement
Retirement may seem a long way off, but the time flies by before you know it. Many individuals put retirement savings on the back burner. This, in turn, leads to needing to take a huge chunk of your income later in life to put towards saving, or not having enough to retire on and working the rest of your days.
The earlier you start saving for retirement the better. You won’t be forced to save such hefty amounts later on in life, you can save a lot more, and you can retire without the fear of having to return to work. Putting even $50 every two weeks into an account when you’re 20 over the next 40 years would give you more than $50,000 in savings.
This list goes on and on. There are a lot of bad money management habits that individuals don’t take into consideration. It may not seem like much now, but eventually, it will catch up to you. To avoid stress and reduce the likelihood of you taking on too much debt in the future it is best to change your ways and start managing your money wisely. In the end, you’ll be happier, have more money in your pocket, and can enjoy more things in life.