Good Money Habits
12.14.15 | Finances
Forming good money habits is like developing any other habit - it is intentional, and it takes practice. The following 10 tips from credit.com are habits that will assist in not only preparing you for retirement down the road but financial emergencies that may occur from time to time.
1. There are no shortcuts.
Risk and reward with investing are correlated. Doubling your money in a short period of time equates to a high return on your investment; that corresponds to taking more risk, not zero risk.
2. Beware of shiny objects.
We are bombarded with new and better gadgets, toys, and opportunities for fun every day. We no longer have to look down the street to see what the Joneses are up to, we have social media to remind us that our friends have better, newer stuff. If we’re not careful, those seeds of discontent can take root and before we know it, we’re spending money on things to fill a need we didn’t even know we had.
3. Watch your waste.
Shiny objects aren’t the only source of needless spending. Forgotten rebates, fruit and veggies that goes bad before we eat them, buying doubles of things because we can’t remember where we put them in the first time. Be good stewards of what is purchased with your money.
4. Save money, and do it intentionally.
Saving regularly through a 401K at work and toward your emergency fund are fundamentals of good financial health. But also consider saving the money you would have spent on something new, but decided it was one of those shiny objects not needed after all. Pat yourself on the back for your frugality, and then take those dollars and put it in the bank instead. Did you decide as a family to skip a dinner out this month to tighten your belts? Transfer that money to your savings account rather than have it sit in checking. This serves two purposes: It keeps the money from evaporating, and it gives you a psychological boost by seeing your savings grow. Learn more about Crockett Savings accounts today!
5. Don’t wait until your debt is paid off to save.
It may seem more prudent to skip the savings when paying off various debts, but it’s important to continue to save anyway. It takes time to form a habit, and training yourself to save is a great habit to form. What will you do when your car breaks down and there is nothing in the bank to pay for the repair? Out comes the credit card, and there goes your progress. It’s better to have some money put away to pay for those expenses, and change the mindset of funding your living expenses with plastic.
6. Don’t deprive yourself.
While you’re doing all these great, disciplined things with your money, don’t forget to let loose and have a little fun with it sometimes. Being too strict with your spending can lead to feelings of deprivation, which in turn can lead to spending binges. Starvation budgets are much like starvation diets. When you cheat, you tend to cheat big.
7. Automate your finances.
Life is busy and the days fly by. Before you know it the month is almost over, and oops, that bill was due last week. Plan out your monthly bills in advance, and take advantage of our no service fee Bill Pay. Automate your savings with scheduled transfers through iBanking so you don’t have the opportunity to weigh whether or not you really can save that amount this month.
8. Don’t automate your finances.
Automate what you can, but don’t go on auto-pilot. It’s easy to stop paying attention to what is being charged monthly on your credit card or automatically paid from your bank account. Even though you have payments automatically scheduled, be sure to review your accounts regularly.
9. Life insurance.
Buy enough life insurance to protect your family. It’s an extra bill, to cover something that probably won’t happen, but a small price to pay to provide for your loved ones if it does. The Crockett Star Checking Account includes Accidental Death & Dismemberment insurance for the primary owner on the account or the family, depending on the type of account chosen.
10. Decide how much is enough.
It is human nature for us to expand our lifestyle to fit our income. Carefully consider what kind of lifestyle you would like to have, and when you get there, stop. Don’t let it continue to expand. Enjoy the “margin,” or extra, that brings, by saving more or giving to folks or organizations that are dear to your heart.