No one actually wants to live paycheck to paycheck, but they also don’t want to stop the habits that are keeping them in that vicious cycle. When it comes to your money, the last thing you want to do is waste it! Being fully aware of what bad habits making you broke and working to fix them can help you work better with the money you do have. I’m sharing 7 bad habits making you broke so you can work to fix them!
Bad habits making you broke…
#1 Thinking You Don’t Need a Budget
Newsflash! Everyone needs a budget, regardless of how little or how much they actually make. Contrary to popular belief, a budget is not a form of evil that means you can’t spend a dime. It simply helps you keep track of your income and expenses. Watch my video below as I break down budget misconceptions and explain why everyone needs a budget.
#2 Buying into Social Media
Thanks to social media, we can see what someone is doing anytime and anywhere. We can see where our favorite celebrities are taking vacation. We can see insta-famous bloggers buying new cars. We can see fashion bloggers rocking new shoes. All of this is fascinating, until it makes you question your own life.
It’s easy to want to compare or compete with what you see on social media, but it’s useless. People are only showing you what they want you to see. So, if you are going out to buy the latest Gucci bag when you already have credit card debt, you are only hurting yourself. That purchase probably doesn’t make you feel that good either.
Buying into social media and letting that influence spending you can’t afford or don’t need can make you broke very fast. Instead, follow people that inspire you to live a better life or grow in your career or business. Unfollow anyone that doesn’t inspire you, makes you feel envious, or makes you question your own successes in life. Why put yourself in a position to feel bad?
#3 Using Credit Like Cash
Ahhhh! The sense of false security you get with an available credit line is frightening! It really does make a person feel like they have more money than they actually do. Credit is not cash, because credit comes with a cost. That cost is interest, and it’s expensive! The average U.S. household has over $16,000 of credit card debt.
There’s no denying that available credit can come in handy in times of need, but it is risky business. Instead, focus on building a short-term emergency fund of $1000. Use this savings account anytime an unexpected expense pops up. This will help you avoid using credit cards to bail you out.
Next, leave the credit cards at home! Stop using them altogether. The rewards and points you may get from them only benefit you if you actually pay the card off in full every month. If you do that, continue to use them, but proceed with caution. The minute you overspend (and yes, it literally takes a minute), you could end up paying hundreds in interest.
#4 Emotional or Impulse Spending
Emotional spending means your emotions trigger when you spend. Does a bad breakup send you to get a total hair and wardrobe makeover? If you have a long day at work, do you treat yourself to a new bag? If you’re happy, sad, stressed, tired, annoyed, excited, do you head straight to the mall?
Emotional spending doesn’t leverage logic. You are letting your emotions dictate when you spend, instead of thinking through your purchases. Take your emotions out of the equation when you are looking to spend money, or find other ways to deal with those emotions.
Impulse spending means you buy things on a whim. You don’t necessarily have emotions dictating your purchases, and you certainly don’t have logic playing a factor. Maybe a flash sale triggers you to spend when you normally wouldn’t. Maybe your favorite store sends you a newsletter with items you might like.
There are plenty of tactics used by retailers to make you spend money, especially on impulse. Fight the urge to impulse spend by walking out of the store. Once you’re out of the store, ask yourself if you really need the purchase. If the answer is no, keep walking!
#5 Ignoring Your Debt
Pretending as if your debt doesn’t exist because it’s too scary or stressful to deal with is not going to make it go away. More importantly, it’s not going to make it any cheaper! Ignoring your debt is costing you more and more money by the month. Money that you will have to pay back, one way or another.
Instead, tackle your debt head on. Accept that your debt is there, and don’t let it get you down. Create a plan to get out of that debt as quickly as possible. You will feel one thousand times better just by having a plan in place, even if it seems like an eternity before it’s paid off.
#6 Complaining about Your Current Income
Guess what? Complaining about the amount of money you make right now isn’t going to increase it. In fact, complaining is taking your mind off of how you can make more money. Stop your complaints in their tracks and think of how grateful you are to actually have money coming in. I mean, imagine if you didn’t?!
Start thinking about ways you can bring in more money. Do you have a hobby that could be turned into a side hustle? Can you get a second job? Depending on your situation and current time restraints, you may be able to bring in a lot more income by thinking outside of the box. Here are a few articles to help you get the wheels turning:
#7 Failing to Shop Around
The final habit of the bad habits making you broke is failing to shop around. Failing to shop around means you aren’t making the most of your spending. What if you could save 5-50% on the exact same item, just by browsing all of your options? If you can’t find the item elsewhere, you can likely by it through a cash back or rebate website and get a little bit of money back. When it comes to purchases, large or small, think through them and weigh all options. Shopping around is just one of the ways you can maximize your spending.
Related: 10 Bad Habits Ruining Your Credit
If you are doing any of the 7 things above, stop it now! Think about how you can change your situation for the better. Complaints and negativity will not help your situation, so remember to focus on the positives. Imagine how much better your life would be with better money management skills! Are you guilty of any of the habits above? How do you stay positive in tough money situations? Post a comment below to share!