Hello, I'm your host, Mr. Chuck, Breaking Bad spending habits. How do you get that done? Before we get started more about this weekly podcast, and we'll get started in 35 seconds. Welcome together, we're going to explore our personal finances and figure out how to improve them. Whether you're just getting started in life on your finances, or you may already have a home, or you're struggling to get credit cards under control, reduced debt increase wealth.com is a weekly podcast, to educate those to improve personal finances, whether it's eliminating debt or making smart investments. Okay, you are making bad spending habits, and how do you solve them, before you can solve what your spending habits are, that may be bad, you got to be able to identify them. And simple finance rule number one, spend less than what you earn. back before the day of credit cards, maybe 1800s, early 1900s, when credit cards weren't around, everybody follow this rule because they had no choice. Sometimes the merchant would give them credit, if they knew they would be good for it. Later on in the year, such as farmers, farmers didn't have a whole lot of money. And in the early spring, when they needed seeds, they would get a credit from the merchant so they could buy their seeds. And when they made their harvest in the fall, then they would pay up their account in full and have a good slate with that particular merchant. But nowadays, with credit cards, and nobody knowing anybody, it's easy to spend more than what you earned, you just put it on a credit card, and I'll pay that off. Next time I get paid. I don't have enough money to pay it off. So I'll pay 20 bucks, and on and on we go. So first thing you need. After you identify that you spend more than what you earn, you have to identify that and you got to realize that could be the start of your spending problem. And it's a habit you need to break. So the first thing you need to do is have a budget. If you're out there spending without a budget, you have no clue how much money you have available to do things such as go out to dinner at a restaurant, when you have food at home, or buy things that you really don't need. But you buy them because you want them or you buy things to keep up with your neighbors. You gotta quit doing that. And you only buy things that you absolutely need to have until you get your credit card debt and all debt under control. Because of a debt reduction plan, your first rule is to quit creating new debt. If you keep spending and charging it, how are you going to do that? It's going to be difficult. Another bad habit you may have is signing up for a free trial subscription. But then you never unsubscribe and then you get stuck in paying for something that maybe you're not using. Maybe you used it for the first 30 or 60 days and thought it might be worth the money. And then after six months, you quit using it and you forgot about it but you're still paying for it. Another bad habit is grocery shopping while hungry or prepared. You need to make up a grocery list and take it with you and only buy the things you need. Watch out for impulse buying because that can ruin your budget even at the grocery store. Another area which you may be overspending on is accepting late fees. Sometimes you don't have the money to make a payment on a credit card or a loan. Or you may overdraw your bank account. And there you're paying all these fees and that's killing your budget, you got to start making on time payments on everything you pay and quit paying for late fees and quit given the bank your money in the form of overdrawn fees or any other fees. Another item area where you can be a bad habit is not researching big purchases. When you go to make a big purchase, you need to step back. And one do you really need it? Do you actually really need it and two? Is what you consider buying? Are you getting the best deal? Or is it the best product for the money, maybe you can find something better, a little cheaper rate. That will give you a longer lifetime lasting. So unless it's an emergency, he got to really do your research before making a big purchase. And I would say a big purchase is anything over $500 or $1,000. Something that you'll have to finance. And again, you got to quit creating new debt debt, shopping as therapy, even window shopping, you got to quit doing that because then you out there spending money that you may not have. You think it's good for your mental or physical therapy. And it may not be you're better off having a whole lot of debt and knowing you have enough money to pay your bills and then next week, pay period or month. Buying rebuy and low quality essentials. When strapped for cash, people often turn to the easiest and cheapest option. However, like items like shoes, furniture and even linen, it's not always the best idea. For less than double the price you can get higher quality essential the last you for years. By contrast many fast fashion clothing pieces, and similar quality home products can wear out quickly. So wait and don't get in a hurry. paying premiums for convenience when you could just plan convenience would be the grocery store buying prepared meals. So the only thing you do is heat them up. That would be a convenience item and you pay a whole lot more. So it's a little bit of planning and budgeting of your time and you'll be able to prepare that same meal for a lot less money. And then again spending more than you earn. Now that just off the top of my head. Now on to get to the articles and see what they have to say. You can find these in my show notes. The first article is from loan me.com the seven worst bad spending habits and how to break them. Many consumers unknowingly practice bad spending habits that leave them Deaton debt. Learning how this stops bad spending habits and how to stop overspending takes commitment, awareness and practice as a chief among bad spending habits is carrying too much debt. Although some level of debt is to be expected carrying too much debt can result in dire outcomes and their growing use of credit among American households, particularly fall in the great recession has different implications. Across Generations. All those most households have more assets than debts and 80% hold some form of debt that can single economic opportunity and potential trouble. For example, accruing some debt at an early age can encourage wealth building but too much debt later in life can increase financial insecurity and consumers are seeking to establish financial security. A good place to start is to get serious about debt reduction. Begin by identifying bad spending habits and adjust to reduce cash outlays and take steps to reduce your debt. One failing to budget same as what I said earlier. Failing to keep track of income and monthly expenses is a recipe for financial disaster and consumers that spend as they go without planning for it. Coming obligations runs a risk of coming up short and not knowing what your future obligations are, is the key here and knowing what's going on. That's why when I've talked about my debt reduction plan to forecast ahead, one pay to pays two months in the fall or ahead, you forecast and know what's coming up, the better off you're gonna be. An d impulse buying retail r today are savvy when it comes o consumer buying habits and the e are good reasons. goods a e placed near the checkout on t e shelf at eye level or mark do n retailers want consumers to b y and they understand buyi g triggers. Try these trips o learn how to stop overspendi g shop with a list, del y unplanned purchases, st p without your children accrui g credit card debt, credit car s can be lifesavers wh n emergencies arise, but usi g them to buy staples such s food, entertainment, and day o day bills can result in balanc s that quickly get out of contro. And I know many of you know y u get the cashback option, t e cashback option, even at 5% f you spend $1,000 You ain't gon a get $50 back, you're still gon a owe $950 on that credit card. I don't understand how that's a good thing. Avoid accrui g credit card debt. overdrawi g accounts in late fees and ban s make big bucks from overdra t fees. The three Bay bigge t banks or more than 1 billi n phases in a single quarter f 2015. Financial Institutio s penalize consumers when th y slip in to an overdraft or ma e late payments. Those fees c n drip quickly drain and accou t paying for unused services a e studies to determine four r five gym memberships go unus d and in most cases, even if cl b memberships go unused, consume s are expected to pay the month y dues. At what called setting p a budget identifying yo r expenses and getting rid of wh t you're not using. Number s x emotional spending and shoppi g addiction is common reaction o the pressures and stress of li e given into temptation to ea e that stress by buying a n w outfit, eating out and possib y impulse impulse full. purchasing a big ticket item c n result in a quick emotional f x and the buyer's remorse a d negative financial consequenc s can follow a solution st y focused on the financial goa s set in the budget. Being awa e that emotional behavior c n contribute to overspending. A M fees, it may seem like much wi h $3 or more surcharge for fe s for ATM transactions can add p fast, there is no value to t e consumer when she or is he r she has to pay to access the r own money. Solution only u e ATMs are connected to yo r financial institution o withdraw cash once or twice a month for personal spending, a d eliminate multiple trips to t e ATM. Some very good suggestio s ther Now we have an idea that we know what's going on. You're paying bank fees, you're paying ATM fees, you're paying overdraft fees, you're spending emotionally, you don't have a budget, you're going to the grocery store without love grocery list. And those are all bad spending habits. And before I and I when I did a review of budgeting apps, I stated that if you have a budgeting app and you set up a budget, if you can have it on your smartphone and take it with you. So when you go to the grocery store, you can pull up your app your budget and look to see how much money you have available within your budget. Remember, you're the one set in a budget. You're the one that controls the budget. That dollar amount for that monthly grocery budget should have been an average based on the last two or three months of spending. You're not really cutting back. We're trying to level it out. If you can Stay under that budget, then you're cutting back a little bit. Over time you can reduce it down, which frees up more money to help you pay down your debt. It's a simple process, you just have to be aware of, and you have to continue staying in control of your money. Okay, my second article is how to create better spending. Every dollar calm and again, there's a link in my show notes. Another fact of life, how you spend your money. It's just as important to your financial success as your decision to say or get out of debt. The important point here is making the decision on your own, that you know what you have to do. So how you're spending money is just so important on saving your money, or applying it to your debt to reduce your debt. Smart spending habits keep you from paying too much for an item, overspending on your restaurant budget, or impulse buying on infomercial, curling iron that doubles as a knife sharpener. Nobody needs that. When you spend smarter your money goes farther. Read on discover how you can break bad spending habits create new ones healthy ones. Let's start by focusing on our not so great spending habits. Ever frankly, rush to your car after making a purchase to log into your bank account because you might have spent too much. Maybe experience a joke of happiness when you swipe your card followed by a rush of guilt and shame when you realize you just busted your budget. As you can tell your first point of a discussion on Breaking Bad spending habits relates to how you feel here's a tip to break bad spending habits consider how they make you feel. Most spending feels fun in the moment in the minutes or even months afterwards, that buyer's remorse sets in. Take a moment to jot down the last not so great choice you made with your money, not how you felt when you made that decision. How you felt in the minutes and days after and how you feel right now, you might notice a downward turn direction to directioner. This is what we want to work to change. Good spending habits might be a tough call at first, but they produce a lifetime of rewards and decide which spending habits you want to break First, take a look at your bank account, talk to your spouse, just look around your house and to get a feel for the spending habits you'd like to break. Feel free to start small and select one or two to address. First a few ideas going over on cell phone data. eating out when you have food at home and buying duplicates of items you forgot your already own shopping impossibly online shopping sales because you love the thrill of a good deal. Now when you buy a duplicate that you forgot your array have, ie if you hold on to your sales receipt, you can take it back and get your money refunded. That's all I have to say about that item. Just because something's on sale, and it's a good deal doesn't mean you have to buy it. Do you really need it? That big screen TV may be on sale and it's $500 off. If you already have a big screen TV and there's nothing wrong with it, it's working just fine. Why would you buy another one? There's really no need. So why buy it just because you kind of say $500 and you're not saving $500 you're wasted that $1,000 day he actually paid for it. Okay, continue working through your list of bad habits. In this way. Recognize the spending habits you want to break and brainstorm ways to replace the bad habit with a good one. Replace bad spending habits with good ones. Give yourself a solid reason to spend wisely spending or savings makes a lot more sense when you have a target to hit. We do this by following the baby steps making money goals and keeping them in mind whenever you swipe your car card or hand over cash. When your spending and perspective. Live on a budget. Creating a plan for your money allows you to prioritize your spending. Put your money, goals perhaps getting out of debt or going on a vacation to the top of your budget. After giving and necessaries Of course, saving for a family getaway makes it easier not to spend money on a daily cappuccino run. Actively practice gratitude take amount every day to write down or verbally a nice a good in your life. After all, there's so much good in fact you you know what the salary of 32,000 and put you in a one puts you in that top 1% of earners in the world. You may not feel too blessed to be stressed but at a regular reminder of this truth can help curb unnecessary spending. After all, we can be grateful for what we have. And you might just realize how little we really need. 32,000 is not a whole lot of money. So if you can, and that puts you at 1% of the URL earners in the world who don't know that fat comes from seems a little low. United States is the richest country on earth. And our poorest people have more than some of the richest people in other countries. research before you shop. If you're in the market to buy a big ticket item such as a TV, washer and dryer. Don't point at a commercial and say I want that one. Do some research, compare prices and select a quality model. When you have more information, you can make a better decision to avoid your spending triggers. We all have those places or people that make us want to spend a little too much. Maybe it's the sweet smell of bakery around the corner, or a friend who tells you how great that purse would look with those Jews in your closet and limit your contract. With those triggers. He can learn to spend only what you plan to spend. Try walking a different route so you don't pass by the bakery. Maybe you can invite your friend on a hike instead of a mall trip. Find an accountability partner for married couples you have a built in accountability partner and your husband or wife. For singles. Your accountability partner can be a trusted family member or a responsible friend. They should be really discuss your big money goals in there to talk through big purchase decisions. Your accountability partner can remind you that you're working towards. Don't shop while you wait. Well, it's tempting to browse online shop while you're sitting in the car line at school or waiting around at the doctor's office. But the small windows of time can open a door to serious spending taking effect your baby step process. If you know you'll be waiting in line, keep a book of magazine with you to help pass the time. Develop patience and ever have Byam fever. When you get so excited about something that you buy it without checking to see if you can afford it. Buying in the midst of the fever can lead to a real headache. Instead, take your time and give yourself 24 hours before purchasing. You typically wake up the next day was a little less excitement, which can help you make more rational buying decisions and develop patience. big ticket items, say over $100 or $500. And he should wait one week and ask yourself it says something Do you really need if you really need it? How are you gonna pay for it? What's your plan? If you have to finance it? Can you afford to finance it? Those are the questions you should be asking yourself. Look for savings before you buy. If you regularly shop at a certain store, you probably know when they offer their best deal so wait to shop then check out your supermarket his weekly sale so you can stock up on sale items that you regularly use and keep an eye on your favorite clothing store and buy out of season coats, shirts and shorts are on clearance and sign up for store email updates or apps and check online for coupons before you purchase. A little work ahead of time goes a long way to saving you a ton in the long run. Make room for fun spending should be fun instead of pretending to spending money is a bad thing. be intentional about setting aside a chunk of money big or small each month. That way you can browse your favorite store, enjoy the date night with your spouse, buy a new tool for the garage, or take advantage of a great deal on Amazon without any guilt. Give yourself permission to spend some money and you won't be tempted to spend All the money. And again, that should be a part of your budget. Having a budget is very important. If you want to break your bad spending habits, you have to plan ahead by planning where your money is gone, and you are controlling the money, and the money is not controlling you. And if you feel like you're working for the banks, and financial institution, and you really don't have much, look around to see what you have. Are you purchasing a home? Do you have furniture in that home? Is your car relatively new, within five years, your are doing a whole lot better, they want you to think you are. Stay focus, create a budget and stay on your budget and not Aloma help you break bad spending habits that you developed. Because maybe you didn't know better. Maybe you were uninformed on what you were gone to do with your income. You just started working. You had a bunch of money and you just started spending spending spending because you had it and then things changed. Then all of a sudden, you're in debt. Now you got to work yourself out of it. I'll be back with my final thoughts and 35 seconds, you can share this episode with your friends open for any suggestions for improvement, or for information that you would like to hear about in the future. You can go to my Facebook page and leave me a message more than glad to respond. To find my Facebook page, go to reduce debt, increase wealth.com and click on that Facebook icon. To break your bad spending habits. You need to first identify what they are and then work on eliminating them. Having a budget app on your smartphone and knowing how much you need or have to spend is an important step and breaking these habits.