Common Financial Sins: Budget Mistakes You Could be Making Right Now

October 21, 2017
You have probably heard the saying “everyone makes mistakes.” This is certainly true when it comes to personal finances. Even people who are frugal and who are able to stick to a budget make mistakes when it comes to managing their money.
Common Financial Sins: Budget Mistakes You Could be Making Right Now

You may not even be aware that you are making mistakes with your money. Luckily, once you become aware of the mistakes, they are usually very easy to correct. And once you correct them, you may find that it is easier (and less stressful) to manage your finances.

Here are some common personal finance mistakes and ideas for how to fix them.

Buying when you could borrow

The most common examples of this mistake have to do with entertainment. Perhaps you like to read. You spend a lot of money on books that you could easily borrow from a library. Or, you could buy the books second hand instead of getting a new book. This could also apply to movies. Instead of renting one movie at a time, you could get a monthly streaming service and watch all your movies for one membership fee instead of buying or renting them individually. You do not have to own a book or movie to enjoy it, and if you borrow, you are freeing up extra money that you could potentially spend to enjoy other things as well.

Waiting to pay bills

Most of your bills are the same amount every month. However, if you wait until the last second to pay them, you put yourself in danger of having to pay more than the usual amount. Some companies charge “late fees” to customers who do not pay by the due date. If you pay your bills as soon as you get them or if you set up automatic payments online, you will avoid these late fees.

Not planning for extra expenses

Extra expenses will often come up when you least expect them. The solution is to always expect them. You can save money for these expenses, and you can have a plan in place for those times when you do not have enough money to cover the expenses. One way to do this is to have a source for online personal loans. Online money suppliers can approve loan applications in a few hours. You can have the money in your bank to cover your extra costs quickly. Unlike credit cards, you pay back online personal loans in installments, so it is easier to get out of debt quickly. This makes online personal loans the best option for financial emergencies.

Not tracking your spending

You should always know how much money you have in the bank. This will keep you from expensive overdraft penalties. More importantly, being aware of your account balance can help you decide whether or not to make certain purchases. Most banks have online tools and even text message balance alerts to help you stay aware of your balance. If you still struggle with this “financial sin,” then perhaps you should switch to an all-cash budget. Some people can manage their money better when they can physically see how much they have.