Personal Finance

Personal Finance – Bad Habits

bad habits freedomsearcher

When I am walking down the street, sometimes I might stop because I saw an ad in the shop window. Then I start to think, who the hell is buying this stuff? Or another good example is the TV shop, who the hell is buying this stuff as well? Has this ever happened to you? You are just watching something with your mouth open thinking what did I saw?

I had this experience a while ago again, so I decided to make a list what are those little bad habits which come hunting you time to time. 🙂

Not having a budget

Not paying attention to how or where your money is spent. Have you ever heard, it was only 25 dollars or 10 dollars? When summing up all these “small sums,” you will understand it is costly when you are doing this month after month or year after year.

Not take care of

Some people just cannot repair the stuff they own, or they don’t want to. They put this thing in some cabin, and they think, okay, I will fix this when I have this and this. So, they will end up having their cabins full of stuff which is broken. This stuff does not have a utility.

Not paying credit card off completely

Credit cards have huge interest rates if you don’t pay it off completely after each month. People might think it is only a few dollars or euros, but in real life, the interest rates are more than 20%. And that is much.

Paying something you are not using

Do you have a gym membership? Are you using it? I have heard this hundred times, somebody has a membership to somewhere, but they are not using it. It can be the gym membership, or that “nice” TV/satellite package they don’t watch or something which takes monthly fees from your bank account, but you don’t use the service.

The power of desire

The power of desire often happens with women in cloth store (don’t get me wrong, it can happen to men’s as well), you just need to buy something because it is -50% or even with -70% price tag. You have feeling that if somebody else might buy this, they will win something and you don’t, or you try to figure out a purpose to buy this. It will be a perfect for my new shoes, blah blah…

Cigarettes, Alcohol, Gambling

Personally, I quit smoking around five years ago. Not the easiest thing but doable. One month after stopping, I said to myself, why I didn’t do this earlier? It was not that bad.

Alcohol, every one of us could use this a little bit less, what you think?

Gambling, you need to understand the game. In long-run the house always won. It does not matter is it the lottery or playing roulette in the casino. With gambling, you will end up losing half your money or more in long-run, but with stocks or low-cost ETF’s, you will win 7-8% per year in long-run.