5 Common Bad Spending Habits

Typically, we make money to spend money. However, some are better spenders than others. Here are five of the most common bad spending habits that can be toxic to your finances.

1. Emotional Spending

When emotions are running high you are more likely to impulsively buy items that you don't necessarily need. Once the binge is over you realize that you don't have use for the stuff you just bought and your budget went down the drain.

Here's a tip, keep a list of things you would like to purchase when the time is right. The next time you want to celebrate your new job or you want to cushion the pain from a break-up, remember to limit yourself to purchasing one item off of your already well-thought-of list.

2. Lending Money

At one time or another we have all stepped up to the plate and loaned someone some cash. Unfortunately, this is neither good for the person you are lending money to or for yourself.

Keep in mind, the next time a friend or family member needs money suggest a solution instead. For instance, if they need money for a babysitter offer to watch their kids. If they need to repair their car, offer to carpool. By not exchanging money you will be saving them from feeling pressured to pay you back and for you feeling tension with your relationship.

3. Picking Up the Check

It almost goes without saying that if you pick up the tab once there will be a time where your company will expect you to pick it up again.

A good rule of thumb is to announce at the beginning of a meal to the server that the check will be paid separately. For example, today we are meeting for lunch and will be needing two checks at the end of this meal. That way both the server and your company knows that everyone will be paying for themselves. Of course exceptions may apply (like birthdays).

4. Comparing Money

According to Gretchen Cliburn, financial advisor, "Big houses and expensive stuff only indicates how some people choose to spend money, not how much they actually have."

You shouldn't compare your money situation to other people. For all you know, they could be living above their means. To keep you from comparing, you should map out financial goals you would like to meet over a certain period of time. By doing this you will be able to focus on you and your financial situation without being affected by others.

5. Depending on Credit Cards

You should always pay off monthly balances on credit cards. You should never choose to make the minimum monthly payments. When using a credit card make sure that you read the fine print. If you do not think you are capable of paying off your monthly balance than you could end up spending more money on items than the original sticker price. If you are already building up debt the best solution is to immediately stop using credit cards.

We at Timothy J. Sierra Attorney at Law would like to state that our blog posts and links, on our web page or any other social media outlet, to any other web pages are not intended for legal advice. We are not responsible for third party website information. If one is in need of legal advice please contact an attorney directly.

Source: Business Insider | Debt Relief