Wednesday, May 1, 2013

Spending Characteristics That Are Getting You Into Debt

Many times people do not realize how much they are spending on a regular basis, until it is too late to step back and debt is  irremediably. When you buy all what is offered in your way or accept each and every single deal that lands in your hand, you might be in financial troubles very soon. Creating a budget is one thing, and  sticking to it another, so what are the spending characteristics that are getting you into that debt you suddenly are dragging for months?

It Is Not Your Fault, It Is Your Spending Habits
All of us develop spending habits throughout life that sooner or  later may affect our financial situation. Borrowing money is probably one of the needs that may turn into a vice, particularly when you borrow  money from payday loans. The first time you apply for one of these  short term loans might be attracted by advertising claiming this is the  solution to pay your bills or cover expenses arisen from an emergency. However, if you find that it is so easy to borrow money this way and  keep borrowing payday loans on a regular basis, you will soon find  yourself in debt.

What is a Budget?
If this is the question that often comes to your mind, this means  that you might never have thought to jot down your income and expenses  to create a budget. One of the spending characteristics that are getting you into debt is not having any control over your income and spending  money as you please. If you go to the store and see a nice wooden box,  here you go to buy it despite you have no idea what you will use it for.  Similarly, you might be going to the supermarket without a shopping  list and let your spending habits dictate rather than sticking to the  list based on a budget to avoid debt. Three Money Mistakes However,  there are other spending characteristics that have nothing to do with  payday loans nor financial planning, but money use. In this case your 3 main enemies are:

Credit Cards, Bank Checks, Debit Cards
Needless to say, that credit cards are part of the worst spending  habit that anyone can have. Plastic money is costly because it carries  interest that makes your debt grow like a snowball rolling down a  landslide, and many people tend to believe the credit limit of the  credit cards are "extra" money when this is not.

Bank checks carry a return financial risk. If your spending habits  include issuing checks, make sure that you have enough money at the  moment the beneficiary clears it, because you may get a huge money slap  otherwise due to high-cost return charges that banks apply.

Finally, the risk of debit cards may not get you directly into debt,  but may hurt your saving, forcing you to borrow money either applying for payday loans or other financial products that equally generate debt.

The main thing to remember is you may have spending characteristics  that are causing you to fall into debt without even realizing the fact,  until you learn to pay attention to the way you spend money.

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