How To Break the Habit of Bad Financial Practices

Written by on November 27, 2012 in Money - No comments | Print this page

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Society does not inspire people to engage in responsible financial behaviors. It instead tells people that they need to have a credit card, that they need to finance things that they cannot afford right now and that they need to have all the latest gadgets and fashions. As a result, personal finances are a mess!

Understand Your Finances

A good place to start when straightening out your financial behavior is to figure out what your financial position is right now. This requires a careful analysis of your monthly expenses and income. This analysis will tell you if you are living within your means or if you are living beyond your means.

Are You Ahead of the Game?

If you discover that you have expendable income after you pay all of your bills, then congratulations. Not many people can say this. You now have the chance to strategize how you will use your surplus income. While ideally you will use your surplus income to pay down your debt, in reality you will probably be better off ear marking a portion of this money to have fun and the rest to pay down debts or to save for large purchases.

Are You In the Red?

Most people find themselves in the red at the end of the month or just barely breaking even. If either of these situations describes your financial position, then you need to figure out a way to either reduce your expenses or to increase your income. In today’s economy, it is easier to reduce expenses.

Tips for Reducing Monthly Expenses

There are many ways to reduce your monthly expenses. A good place to start if you have broadband Internet is to get rid of your cable subscription. You can access most of the network programs online through network websites and you can view TV episodes and movies though subscriptions like Netflix and Amazon Prime. These services will save you nearly $100 a month on cable charges and you will be offered a wider selection of programming.

Another way to save money each month is to plan out your vehicle usage better. Gasoline and car maintenance is expensive. You can cut down on these costs by using public transportation, reducing the number of trips into town that you take, carpooling and walking or biking when you can.

If you have kids you can have them clip coupons for you or find free coupons online for your local shopping needs. Groupon.com is an excellent site that will send you specials every week.

Do a search online for “free local movie passes” and you will be able to get notices of free passes when new movies come to your local theater. The passes are usually for two people, but you can always log off and then on again for more passes.

This is a guest post.  What ideas to you have to improve your financial position?

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