5 Easy Tips for Breaking Bad Money Habits

1. Resist impulse buying: It's easy to get drawn into making unexpected purchases. Here are a few ways to reduce the likelihood that you'll be tempted: 

  • Don't use a basket or cart. People who shop with a basket buy much more than those who don't.
  • Don't linger. How much time you spend in a store is one of the most important factors in determining how much you'll buy.
  • Don't touch or taste. Many impulse buys are triggered by some tactile experience.
  • Be on your guard near the register. The register is where the temptation to make impulse purchases is the greatest.  

2. Automate your bills: By making your important payments automatic, you'll ensure your bills get paid on time, and you'll avoid late fees.  While many businesses will let you set up an automatic payment directly with them (usually done by giving the business your debit or credit card number), this can make it more difficult for you to end their service should you discontinue using them.   We recommend keeping the ball in your court by setting up automatic payments through online bill pay. Not only is it free & easy to use, it gives you the power to edit or delete the payment anytime you want.

3. Pay more than the minimum: Set up automatic, timely payments of a higher amount than the minimum.  For fastest results, create a "debt snowball," in which you pay as much as you can toward the lowest-balance card or loan until it is paid off. Then, add those newly freed up funds to your regular payment amount on your next smallest balance (creating a snowball effect).

4. Save small rather than not at all:  Again, the more you can automate, the better off you'll be.  Set up automatic deposits, no matter how small, to retirement and cash emergency savings accounts. Then you can build your plans over time, adding special savings accounts for larger expenses like vacations or home improvement projects (check out our MyChoice account).
5. Do sweat the small stuff: Look seriously at your daily spending of small dollar amounts for such things as coffee or eating out.  Identify one wasteful daily spending habit and work to stop it. If it's something you just can't give up, instead of removing it completely, just aim to reward yourself once a week.  Then, determine the monthly amount you will be saving, no matter how small, and pay yourself first through an automatic deposit from your paycheck to your savings or retirement account.

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