Spending Habit Pitfalls

Spending Habit Pitfalls

BIG Ideas:

  • Having a monthly budget can help ensure you have enough money to pay your bills, save for your goals, and keep your spending in check.
  • Beware of budget busters like spending beyond your means, impulse buying, and accumulating credit card debt.
  • Having an emergency fund can help ensure you’re prepared for life’s expenses.

There’s nothing like being in control of your money. It can help ensure you always meet your bills, save for the things that are important to you, and maybe even help you sleep better at night.

But managing money isn’t always easy. Sometimes life can throw unexpected circumstances and expenses in your path that can cause even the most disciplined savers and spenders to get off course. Circumstances like:

  • Job loss
  • Disability or illness
  • Medical bills
  • Costly car or home repairs
  •  Rent increases
  • Soaring inflation on food, gas, and other everyday needs
  • Increased utility and insurance bills

Though you can’t anticipate when these situations may arise, you can plan for them by creating an emergency fund. Experts recommend that you have at least 3 to 6 months of expenses set aside in your fund. Building that fund is not that hard if you get in the habit of saving.

Spending You Can Control

You may not be able to control inflation or a job loss but don’t worry, there’s a lot in your financial life you can control, including avoiding these common budget busters:

  • Impulse buying. Before you swipe your card or fire up your online shopping cart, stop and ask yourself: Am I buying something I need or want?

    For example, you may want the latest model cellphone, but if your current phone is in good working condition, you don’t need a new one. Separating wants from needs can really help you cut your spending.

  • Ordering in/dining out. Enjoying your favorite meals without doing dishes is a real treat. Unfortunately, dining out and ordering in is an expensive habit that can strain your budget. Eat at home when you can – it won’t eat away at your budget.

  • Grocery shopping. There’s a reason money gurus tell you not to shop for groceries when you’re hungry; you’ll end up spending more money. Make a list of what you need before you shop, take advantage of rewards cards, and look for sale items.

  • Streaming and other subscription services. Sure, some may cost just $10 a month, but having several music, gaming, and movie services can kill your budget. Prioritize what’s important to you and make some tough cuts.

  • Credit card debt. With interest rates high, carrying excess balances on credit cards will cost you a pretty penny. Look for ways to trim that debt.

  • Entertainment and travel overspending. It’s great to have fun and enjoy travel and other interests, but just make sure you’re not paying for things you can’t afford by using credit cards.

    If you like to spend money on travel or other activities, start carving out money in your budget. And don’t be afraid to say “No” to things you can’t afford. It’s like saying “YES!” to financial success and freedom.

Build a budget that works for you

If you haven’t done so, take some time to review all your monthly expenses and sources of income to create a budget.

Having a budget will help you see where your money is going and identify ways for you to save more for the things that matter most to you. Learn more about how to create your budget, including apps that make budgeting easy.

Brazos is here to make borrowing affordable

For more than 40 years, Brazos Higher Education has been helping students and parents with the education and student loan refinance loans they need for a brighter future. As a non-profit, we can offer you low rates that won’t bust your budget. Contact us today!