Most Common Money Habits that Make You Bankrupt

Home  >>  Bankruptcy  >>  Most Common Money Habits that Make You Bankrupt

Most Common Money Habits that Make You Bankrupt

6
May,2019

0

Are you one of those who simply wishes to go back in the time and fix their past money mistakes? Especially, when you realize to have wasted a hefty amount of money? Well many of us have bad money habits that eventually lead to financial disaster and bankruptcy.

Habits are those tendencies in us that are hard to break. These are the actions we do without even knowing about it. Whether good or bad ones, they shape our lives.

If you don’t realize where all your money goes, chances are higher that you possess the wrong money habits, and you need to work on yourself to replace those with positive habits: Y

You Spend More than You Earn:

The biggest financial sin you could commit is to spend more than you earn. This habit affects all other areas of your finances. You start depending on the credit to cover the cost of your purchase. This credit traps you with interest and further in debt. When you make a habit to spend more than you earn, this habit becomes a vicious cycle.

Stop spending money wish to limit your expenses. Two things you can do to change this habit; either earn more money to cover your expenses, or cut your spending and wisely make a budget from the available amount of money.

You Pay Bills through Credit Only:

If you are unable to use the credit appropriately, you are trapping yourself in an expensive credit. You must analyze your buying habits, for instance, if you are using credit to cover your basic needs such as food, bills or you buy clothes on credit, stop doing this.

At some point in your life, you may need to rely on debt such as for covering education expenses or mortgage, but do it with extreme caution and care.

Having No Emergency Funds:

None know what happens the next moment. Car wreckage or job loss! When you find yourself in such sort of emergency situation, make sure you have an emergency fund to cover when things go wrong.

Ideally, you should at least save living expenses for three months in case two people earn money in a family; and in case of a single income, save for six months at least.

If you are unable to save this much amount out of your income, try saving a few hundreds of dollars. To pay for the groceries or repairs as these small expenses lead to the financial difficulty more than a simple job loss.

Paying Your Bills Late:

Even the best of us sometimes give into paying their bills late. Paying the bills late causes you to pay more for the credit given the late fees and interest charges. If you are in the habit of paying your bills late, force yourself to pay your bills on time.

You may consider auto-paying your bills in case you procrastinate the payments. In addition to it, you need to make yourself financially organized wish, you will soon run to the bankruptcy attorney and ask for help you in filing for bankruptcy.

You Don’t Save for the Future:

Not only you need to pay attention to your spending habits, but also you must think of saving money for the future. You may come across many people saying that live today, why to save for the future; don’t listen to them.

Although you should enjoy different things in life, you wish don’t want to live in misery after your retirement. Make sure you save for the future and work hard to achieve your financial goals.

You Don’t Make Budget:

Failing to make a budget now is the surefire way to fall into bankruptcy later. When you make a budget for your expenses, you prevent yourself from debt as well as save money for the emergency fund. It does not only saves you but also gives you an idea about reaching your financial goals.

For that matter, you need to track your spending. When you understand your income and expense ratio, you will be more effectively make a wise spending plan.

Failing to Take Care of Your Career:

If you end up in a job you don’t enjoy, or cannot find a job, take charge of your situation and career. Although it may seem much challenging to find a new career path, or starting a side business, however, you should focus on your financial situation as well as career. Because none is going to improve your situation- it is all in your own hands.

If you can, think about salary negotiations to boost your income and saving.

Key Note:

When you realize the bad money habits you have honed, it becomes easier to replace those habits with new ones. The key idea is to live within your means, enjoy your life and stay away from the consumer debts.

Enjoy this blog? Please spread the word :)