Behaviors worth changing.
Provided by Taylor McClish
Do bad
money habits constrain your financial progress? Many people fall into
the same financial behavior patterns, year after year. If you sometimes succumb
to these financial tendencies, now is as good a time as any to alter your
behavior.
#1: Lending
money to family & friends. You may know someone who has lent a few thousand
to a sister or brother, a few hundred to an old buddy, and so on. Generosity is
a virtue, but personal loans can easily transform into personal financial
losses for the lender. If you must loan money to a friend or family member,
mention that you will charge interest and set a repayment plan with deadlines.
Better yet, don’t do it at all. If your friends or relatives can’t learn to
budget, why should you bail them out?
#2:
Spending more than you make. Living beyond your means, living on margin, or
whatever you wish to call it – it is a path toward significant debt. Wealth is
seldom made by buying possessions; today’s flashy material items may become the
garage sale junk of the future.
#3: Saving
little or nothing. Good savers build emergency funds, have money to invest and compound,
and leave the stress of living paycheck to paycheck behind. If you are not able
to put extra money away, there is another way to get some: a second job. Even
working 15-20 hours more per week could make a big difference.
#4: Living
without a budget. You may make enough money that you don’t feel you need to budget. In
truth, few of us are really that wealthy. In calculating a budget, you may find
opportunities for savings and detect wasteful spending.
#5:
Frivolous spending. Advertisers can make us feel as if we have sudden needs; needs we
must respond to, or ones that can only be met via the purchase of a product.
See their ploys for what they are. Think twice before spending impulsively.
#6: Not
using cash often enough. No one can deny that the world runs on credit, but that doesn’t mean
your household should. Pay with cash as often as your budget allows.
#7: Thinking
you’ll win the lottery. When the headlines are filled with news of big lottery jackpots, you
might be tempted to throw a few bucks at a lottery ticket. It’s important,
though, to be fully aware that the odds in the lottery and other games of
chance are against you. A few bucks once in a while is one thing, but a few
bucks (or more) every week could possibly lead to financial and personal issues.
#8:
Inadequate financial literacy. Is the financial world boring? To many people,
it can seem that way. The Wall Street
Journal is not exactly Rolling Stone,
and The Economist is hardly light
reading. You don’t have to start there, however. There are great, readable, and
even, entertaining websites filled with useful financial information. Reading
an article per day on these websites could help you greatly increase your
financial understanding.
#9: Not
contributing to retirement plans. The earlier you contribute to them, the better;
the more you contribute to them, the more compounding of those invested assets
you may potentially realize.
#10: DIY
retirement strategy. Those who save for retirement without the help of professionals may leave
themselves open to abrupt, emotional investing mistakes and other oversights.
Another common tendency is to vastly underestimate the amount of money needed
for the future. Few people have the time to amass the knowledge and skill set
possessed by a financial services professional with years of experience.
Instead of flirting with trial and error, see a professional for insight.
Taylor McClish may be reached at (503) 239-3060 or Taylor.McClish@cunamutual.com
This material was prepared by MarketingPro, Inc., and does not
necessarily represent the views of the presenting party, nor their affiliates. This
information has been derived from sources believed to be accurate. Please note
- investing involves risk, and past performance is no guarantee of future
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purpose of avoiding any Federal tax penalty. This is neither a solicitation nor
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service, and should not be relied upon as such. All indices are unmanaged and
are not illustrative of any particular investment.
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