4 Ways You Can Form Better Spending Habits
posted on Wednesday, January 27, 2021 in Financial Tips
Bad spending habits like overspending and impulse-buying can keep you from achieving financial success. They are challenging but not impossible to break. Going the extra mile to form better money habits like saving a portion of your income in a credit union savings account, will help you reach your goals. Here are some ways to help you achieve this.
Acknowledge Your Bad Spending Habits
To reach your goal, you must identify what’s keeping you from achieving it. Take the time to assess your spending patterns and write down unhealthy habits that you want to break. Do not overwhelm yourself by tackling everything on your list all at once. Instead, pick one or two habits that you want to focus on first. This could be anything from going over your cellphone data limit to buying impulsively online.
Identify Your Financial Goals
Set a bigger financial goal like saving for a car and use it as a guide to help you make wiser spending choices. Having a target helps you become more conscious of the things you buy. Before making an unplanned purchase, consider asking yourself this, “Will buying this help me save for my dream ride?”.
Adhere to a Realistic Budget
One way to avoid overspending is establishing a sustainable budget for yourself. Don’t go to extreme lengths like completely cutting out nonessential expenses like eating out or getting a gym membership. Instead, set a realistic spending limit every month.
To set a realistic budget, consider using the 50/30/20 rule wherein you allot 50% of your salary to your needs; 30% to your wants; and 20% to savings and debt repayment. You can also adjust this ratio based on your priorities. Just keep in mind that you worked hard for your money, and you deserve to treat yourself once in a while.
Follow the 24-Hour Rule
If you have the tendency to buy things impulsively and regret it a few days later, then the 24-hour rule might work for you. The idea is to give yourself 24 hours before making a purchase. This will give you ample time to think things through. If you still want it after the waiting period, then go ahead and buy it.
See Your Financial Goals Come to Life!
Saving money and consistently placing it in a credit union savings account, is one habit you can work on to achieve your money goals. At Community 1st Credit Union, we offer different types of accounts to our members. Whether you’re saving for a vacation or looking to fund your retirement, we have just the right thing for you. For questions regarding our services, call us or fill out the form on our website.