Are You Being Smart With Your Money? Here Are 8 Reasons You’re Not

Smart-with-MoneyThere are people who are able to manage their finances very well. There are others who make financial mistakes that are costing them money and hindering their ability to have a more secure financial situation.

Here are some things you should change to improve your financial future.

  1. Credit cards can be helpful if you have an unexpected expense such as car repairs. Credit cards can lead to financial disaster if you use them to live beyond your means. They are not meant to be used to purchase anything you want, but cannot afford. Nor are they meant to be used for cash advances to fund your lifestyle.

Having a budget can help you better handle your funds. You will know what income comes in so you will also know how much money can go out.

  1. Making late payments and paying overdraft banking fees are unnecessary expenses. It makes no sense to have to pay these types of charges. Learn to make your payments on time regularly and avoid late payments. Making payments late is not only expensive it will damage your credit score. Avoid banking overdraft fees by being sure there is enough money available in your account before using it.
  2. If you are married or sharing accounts with a partner the two of you need to communicate. If you are both spending the same money you can have a problem unless you talk with each other and make joint financial decisions.
  3. You have a problem with your financial situation when every unexpected expense is a problem. Ideally, you will set aside funds to handle unexpected expenses.

retirement planning5. You have a problem when your money runs out before it is time for another paycheck. If you find yourself constantly running short of funds you need to rethink your spending habits. If your income does not cover your expenses an additional source of income can help. Perhaps there are some expenses you can eliminate or lower. Perhaps you can get a second part-time job temporarily or perhaps you can sell some items on consignment or at an internet site.

6. You have a problem when you think its alright to spend whatever money you receive. If you income is $5,000 monthly and your spend $5,000 per month you have a problem. You should be saving something of every dollar you receive. You want to get into the habit of paying yourself first and saving this money. You need to learn how to live below your means.

7. When you are worrying about finances and are unable to sleep at night because of the worry you know you have a problem. The only way to rid yourself of this worry is to take charge of your finances. Sit down and make a budget. List income and then subtract expenses. Working with a budget will really help you take control of your money.

8. You have a problem if you continue to eat out often, purchase specialty coffee daily, spend freely on entertainment, shop for luxuries and make other frivolous purchases when your money is tight. Stop purchasing unnecessary items until you have improved your financial situation .

You will sleep better at night and have much less stress once you have developed and are following a plan to get your financial life in order.