Learning financial responsibility is a rocky road developed by trial-and-error. Whether you are struggling to maintain your financial stability or easing into financial responsibility, these common mistakes have simple alternatives that can save you money. Quite often the difference between good financial health and bad financial health is a marginally better decision. While you might not be able to anticipate all of your future financial needs, you can make better choices when the needs arise.
Credit Cards or Small Personal Loans
Racking up credit card debt with high interest rates can be a hard hole to climb out of. Ever considered strengthening the relationship between your credit score and your bank or credit union? Most financial institutions will issue unsecured, personal loans for emergency purchases and provide small payment options while building your credit score.
Short-sighted Budget or Multiple Zero-based Budgets
The objective of a zero-based budget is assigning each dollar earned to particular expenses. In other words, when you are done budgeting, there is nothing left over. This allows you to track every dollar and control your spending better. People living on a zero-based budget understand better that they don’t have any “left over” money to make up for dumb spending, and save more.
Payday Loans or Check Cashing
When finances get tight and it’s all you can do to just live paycheck-to-paycheck, payday loans look rather enticing. These loans offer payment plans that work with your payday schedule and vary based on income, but they have punishingly high rates, and slews of fees. If, for example your employer pays you a day late, you could be hit by hundreds of dollars in late fees. A reasonable alternative might be personal check cashing in Detroit MI, or wherever you live. This would still force you to discipline yourself and not spend your money before you earn it, but it gives you the ability to get more cash than most ATM’s might if you need it in an emergency, without the interest rates of payday lenders.
Shared Finances or Independence
Shared finances come in many forms. Helping a significant other with shared bank accounts and credit cards while they are going back to school or between jobs can put ambitious savings goals on the back-burner. Motivating each other to keep individual goals with separate finances can be more rewarding than depending on one stretched money pool.
Single Income or Several Eggs
One employment reference brags loyalty on a resume, but having an array of skills and experience can open doors elsewhere. Second jobs and freelancing gigs are becoming more competitive for individuals looking to plump up their wallets and savings.
Convenience Fee or Intelligent Habits
Instant gratification is offered so easily in a drive-thru coffee and doorbuster sales, but impulse buys can be the biggest blunder. Strategic budgeting and developing habits such as researching, couponing, and meal planning will save you from hidden convenience fees.
A solid financial state can be achieved through trial-and-error, but these comparisons can help you see how marginally better choices can have a much better result in the long run.