Are Bad Habits Keeping You in Debt?

/ BY / Managing Debt

Why are you in debt?

The answer to this question varies from person to person. In some cases, excessive debt comes from reasons beyond our control, like a job loss or staggering medical costs. In other cases, however, excessive debt comes from poor money management or lack of spending control. These behaviors are usually driven by our bad habits we've developed over the years.

Here are three common attitudes or habits that could be getting--and keeping--you in debt:

You’re impatient.

Patience is a virtue that pays off in all areas of life, including your finances. The credit card industry makes billions of dollars a year because many people would rather put certain purchases on credit rather than save the money and pay cash for them.

The need for instant gratification can end up costing you big time. For example, let's say you max out your $5,000 credit card on furnishings for your new home. If you paid just the minimum balance on your card, it would take you over 22 years to pay off the full balance. Not only that, but during that time you would have spent nearly $7,000 in interest.

You try and keep up with the Jones’s.

Imagine this scenario: your neighbor purchases a beautiful, brand new car. Suddenly, your reliable (and paid for!) car starts to look like a pile of junk to you. Do you go out and purchase a new car too, or do you continue to drive your car and be grateful you don't have a hefty new car payment?

Trying to "keep up with the Jones's" by living beyond your means is an unhealthy attitude that can lead to serious financial trouble by driving you further in debt.

You’re a little too laid-back.

At one point or another, most of us have probably forgotten to pay a bill on time or spent a little too much money on something we really didn't need.

When these are very rare or isolated incidents, they don’t cause too much damage. But when you continually make irresponsible financial choices and shrug them off as no big deal, it can cost you in the long run. You may end up wasting money on late fees and over-limit charges, become further in debt, or damage your credit score. These irresponsible decisions will eventually catch up to you when you want to buy a house or make another big-ticket purchase, but don’t have the credit or savings for it.

Adjusting Your Attitude

If you’re guilty of one (or two, or three) of these, don’t worry—it’s never too late to adjust your attitude and get your finances on track. You can take control of your financial behaviors by replacing potentially-damaging habits with new and improved habits:

  • Remove temptation. If you’re an impulse shopper, eliminate the temptation to buy things on a whim by carrying only cash or removing your credit cards from your wallet or purse altogether.
  • Make financial goals. Setting goals like saving money for a house or paying off debt can help you control your spending. Before making any purchases, ask yourself, “Does this put me closer to my goal, or further away?”
  • Get organized. Conveniences like automatic bill pay and mobile phone apps that track spending and alert you of due dates can help you keep your finances organized.

Pinpointing the cause of your debt troubles is the first step to overcoming them. Once you know what bad habits and attitudes are keeping you in debt, you can start making simple changes to change them.

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Please note your financial situation is unique and our tips & advice presented here may not be appropriate for your situation. recommends that you seek different advice & opinions from your own accountant or financial adviser who understands your individual circumstances before making any important decisions or implementing any financial strategy.