Everyone makes financial mistakes from time to time, but some people make them every day.
Everyone makes financial mistakes from time to time, but some people make them every day. They work hard for their money but practically throw it out each day by making these common mistakes. Read on to learn what they are and how you can avoid them!
- Using Your Credit Card Too Much
Credit cards can be great financial tools when used properly, but many people use them too often and charge too much. The result is a bad financial position that is difficult to escape. To avoid making this mistake, limit the number of cards you have and set rules for their use. Stick with no more than two cards. Use the one with a lower interest rate for emergency purchases, then use the second for day-to-day purchases that you pay off on a monthly basis. Never use your credit card unless you can back up your purchase with money in the bank.
- Wasting Food
Americans waste a staggering amount of food each year, totaling thousands of dollars of waste for some people. Stop wasting food and money by carefully planning your meals and shopping with a strict list. Instead of eating out, dine on what you have at home, and avoid impulse buys by having a snack before you head to the grocery store.
- Skipping a Budget
Surprisingly, most people do not keep to an active budget. They may have a bit in savings and attempt to make payments on time, but most people don't effectively plan their finances and end up wasting large sums of money when they don't have to. Create a budget using an online tool, spreadsheet or pencil and paper, and stick to it. Account for annual and semi-annual expenses, the costs of daily living, an emergency fund, and give yourself some wiggle room for occasional splurges.
- Not Monitoring Credit Reports
More and more consumers are learning the importance of monitoring their credit reports, but many still skip this important financial step. Not checking yoru report can lead to inaccuracies or identity theft. Request your credit report three times a year and read every word of it. Dispute any mistakes you find immediately.
- Not Shopping Around
With so many budget and shopping comparison apps and websites available today, there is no reason to not look around for the best deals. Before you make a large purchase, check a variety of brick and mortar stores and websites to find the best deals.