Not using debt correctly.
All debt isn’t necessarily bad. Debt is useful when getting your education and even when hard times hit. If you take on too much debt – you could put yourself in a hole that you’ll never be able to dig out of. On the other hand, if you’re afraid of ever having any debt, you may live a boring life. Use credit cards to build a good credit score and never use them for major purchases. If you take on debt, make sure you keep it under control and always remain aware of where you stand.
In an ideal world, we would all save 33% of what we earn. For most of us, this a problem, due to our overspending habits. Whether it be for housing, child care, student loans, or other debt, we’re spending those savings on other things. Try to save wherever you can – even a little bit out of each paycheck is never going to be a waste!
Relying on only one income source.
By counting on our full time job as our only money source, we’re setting ourselves up for problems. Having some side money coming in from a part time or freelance job can also be a nice crutch if something were to go wrong.
Only paying the minimum on credit cards.
When you only pay the minimum on your credit card balance each month, you end up costing yourself a lot of money in interest by carrying a balance. Make sure you don’t spend more than you can pay off at the end of each month. Credit card debt can easily feel like a black hole with no escape.
If you’re not saving, you’re probably not budgeting. Plan ahead and put money aside each month for emergencies. Take a long look at what you’re spending and figure out what you need to put away for retirement. If you don’t have an IRA or other retirement account, you need to enroll ASAP and take advantage of that compounding interest for your future.
First Financial can help you with all of these items! Visit our website at firstffcu.com, stop into any of our local Monmouth and Ocean County branches, call 732.312.1500, or email email@example.com.
Article Source: John Pettit for CU Insight, https://www.cuinsight.com/5-money-problems-people-deal.html