There are millions of Americans who waste money every year simply because they don’t know any better. They pay too much for products and services, spend money that they don’t have, use credit cards and end up paying hundreds of dollars in interest fees over the long haul and just generally act irresponsibly with money. Some of that reckless behavior has even factored into the country’s current economic state.
But the truth is that many of them don’t know that they’re doing anything wrong with their money and need help. Continue reading to find out what you could be doing wrong and how you can improve your finances as you move into your financial future and try to save money.
Jennifer Openshaw, author of the book Millionaire Zone, interviews successful women on their struggles with money in this clip. It demonstrates some of the common mistakes people make when it comes to money.
Video: Even millionaires need help with their money
The most common money mistakes in the country
Saving money really isn’t that hard. But you need to know where to begin and what to watch out for. Here are just some of the mistakes that Americans make every day.
Spending impulsively: Have you ever bought a shirt that you were just dying to have—even though you couldn’t really afford it? Have you ever paid more for a car than you should have simply because it was a great deal? Have you ever gone shopping to make yourself feel better? Chances are you’ve done one of these things or done something like one of them. And when you did, you spent money impulsively and probably ended up regretting it later. Americans typically use credit cards to spend money impulsively and fail to think about the consequences. And with the use of online shopping on the rise, it’s only getting worse. In order to avoid spending money impulsively, start thinking more when you shop and create a mental checklist as you decide to make a purchase. Ask yourself: Do I really need this item? Can I save up money and buy it later? Do I already have a similar item at home? If I had not come to this store today, would I still want this item? Think long and hard and don’t be impulsive.
Refusing to check for cheaper deals: Shopping around is something you should always do. Whether you’re buying a car or buying a loaf of bread, know where to get the best deal for your money before you leave your house. Today, there are literally hundreds of web sites that can help you shop comparatively and find deals on items you plan to buy. It also gives you time to avoid being impulsive.
Not creating a regular savings plan: Too many people in America forget to save money. And the truth is that you don’t have to save hundreds of dollars every month in order to have an effective savings plan. Rather, consider saving $20 from a paycheck to start and then increase the amount gradually. Over time, you get used to saving and will want to do it more often.
Not tracking finances or creating a spending budget: Do you know how much money you spend on food every month? What about how much you should be allocating yourself for entertainment purposes? Creating a budget is the best way to know how much money you need to survive every month and how much you can spend on things outside of the essentials. It’s also a great way to see how much you can save and how much you’re wasting every month. A budget is probably the best way to manage your money and avoid debt. It also, unfortunately, is one thing that far too many people fail to create.
Borrowing money at high interest rates: At some point, everyone needs to borrow money for something. Homes, cars and even college require borrowing money and repaying it over time. But when you decide to borrow money, you should always be borrowing from the best lender. Don’t take the first offer that comes your way. Rather, find a loan and an interest rate that suits you best. Interest rates determine how much money above the initial loan you will need to pay back to a lender. So make sure you’re not sticking yourself without a rate that you can’t handle.
Credit cards are often the problem behind most Americans’ money troubles. In this clip, you’ll hear about one woman’s monetary problems and hear how a budget could have helped her earlier.
Video: One of the worst money mistakes you can make
Avoiding money mistakes in the future
If you’ve made mistakes with your money in the past, it’s never too late to turn over a new leaf and get started with a new plan now. The great thing about money is that you can waste it but you can also be extra careful with it and make more back next time. There’s hope for you, no matter how bad it has gotten. All you need to do is stop making the same mistakes you’ve been making and forge a new path. Start acting responsibly with your money—it really pays off in the end!
