We usually focus on our regular lifestyle habits like eating, exercising, or maybe reading habits to adapt, but we rarely focus on our money habits which might be giving us headaches and stressful life. Sometimes, we don't even recognise those habits. Let’s go through all the negative financial traits we might have that we need to give up before this year ends.
Spending before saving
It has become quite easy these days to plan your expenses even before your salary is credited, thanks to the ‘buy now pay later’ facilities. But we need to understand that it is harmful to our financial stability. Instead of planning your expenses in advance, plan your savings before the month starts. Keep aside a particular amount of money as saving or start an SIP that has to be debited at the start of each month.
Not maintaining your emergency funds
We all have heard a lot about emergency funds this year due to job loss. Maintaining your emergency funds is also a priority. When you utilise your emergency fund, even if a part of it, refill the same as soon as you have money to save. Emergency funds are not a one-time thing, they should remain in continuity for you.
Creating unreasonable budget
Due to overwhelming situations, we get excited and overestimate ourselves, and end up creating unreasonable budgets. You need to budget your expenses according to your fixed income and current lifestyle. Overbudgeting means you require ₹5,000 for something and you budget it for ₹8,000 and underbudgeting means you need ₹5,000 and your budget is ₹2,000. In both cases, you have to deal with financial stress.
Using ‘buy now pay later’ as free money
Whether you pay now or later, you are the only one who has to pay ultimately. It might give you the illusion of having money in your bank account, but you only have what is going to be credited at the end of the month. It is not free money, you will be liable to pay. So spend only for what you need as the coming day might be more difficult if you overspend.
Buy instantly when you see
Advertisements are made only to spend you more. However, one must restrain unnecessary expenditure. Think 10 times and wait for at least 3 days before buying any product you see in an advertisement.
One must give up these habits not only because they are harmful but also because the coming year is likely to be a difficult amid a lot of uncertainties.
Anushka Trivedi is a freelance financial content writer. She can be reached at anushkatrivedi.com
