Money Smarts

13 Bad Money Habits to Break on Friday the 13th

Change your beliefs and break these money habits to improve your life.

It’s Friday the 13th, are you feeling a bit more cautious or scared? The fear of Friday the 13th is called “friggatriskaidekaphobia.” Trying to say friggatriskaidekaphobia 13 times, I’d be scared too.

I’m not a superstitious person. I don’t have any negative associations with Friday the 13th or the number 13 in general. However, the number 13 is known to some as an unlucky number and having the 13th day fall on a Friday makes some avoid stepping on cracks in fear it’ll break their mother’s back.

Instead of breaking your momma’s back, let’s break some bad money beliefs. I thought it would be interesting to share 13 bad money habits to break on Friday the 13th.

Checking your credit report only after applying for credit

Got turned down for financing? Your credit score is a reflection of the information on your credit report. Everyone should check their credit report once a year through AnnualCreditReport.com and verify the accuracy of the information.

Review your credit report prior to applying for a credit or financing. Use a free credit monitoring service to check your score.

Checking your bank account only twice a month

If payday is the only day you review your checking account balance, then you’ll have a harder time understanding spending habits and control your money. Use a personal financial management or budgeting tool to help you monitor your spending.

Review your accounts frequently, get app notifications, set up text alerts to get up-to-date transactions.

Depositing your paycheck

Direct deposit makes it easier for you to access your money on payday. If you’re worried about bank glitches, imagine how long it takes to get a replacement paycheck for the one you lost. Waiting to get a physical paycheck means you’ll find yourself driving to the bank, waiting in line, and in some cases waiting a couple days before it clears.

Set direct deposit with your employer and make your life easier.

Swiping your debit card mindlessly

While waiting in line at the cashier, I’ve heard people say, “I don’t understand. I had enough money. What do you mean it didn’t go through?” Check your available balance before you start swiping your debit card.

Know how much you can spend after your bills and other expenses have been paid.

Withdrawing money at out-of-network ATMs

ATM fees can add up. In 2016, big banks made $6.4 billion in ATM surcharge fees and overdraft fees. How many fees have you paid because you withdrew money out-of-network and paid an ATM surcharge fee? I had a friend who checked his bank statement and realized he paid $390 in ATM surcharges in one year. That means he visited an out-of-network ATM at 7 times a week.

Plan ahead by withdrawing the amount of cash you need for the week. Find surcharge-free ATMs through your banking provider’s website or mobile app.

Writing a check to pay utilities and other bills

You might feel in control by writing checks to your billers. However, if you wait last minute to send out a check, you risk the chance of a late payment and get hit with a fee. With online bill pay features, you can access many of your billing statements. This makes it easy to schedule your payments ahead of time and have a check or electronic transfer done on the date you specified.

Ask your financial institution about online bill pay services. Set up your account and make paying your bills easier.

Carrying a credit card balance month-to-month

Keeping a balance on your credit card from month to month does not improve your credit score. In fact, it may have the opposite impact. Credit scores look at your revolving credit utilization meaning it’s calculating the outstanding credit balance against your credit limits. Get to close to your limit can mean a lower credit score.

Pay off your balances in full each month. If you’re carrying a balance now and unable to pay off the unsecured debt, follow a debt payoff strategy.

Reacting when it comes to money situations

Most financial situations can be seen because they are a result of decisions made. For instance, if you’re having a hard time paying a debt or expense, many may way till the very last minute to reach out to the creditor.

Be proactive. The moment you believe you cannot make loan payment, call your creditor and learn about your options.

Buying extended warranties on everything

It’s not necessary to add extended warranties on most purchases. If a gadget has a defect, it will most likely break within the limited warranty period. Additionally, a few credit cards automatically offers extended warranties when you use the card for specific items.

Calculate the cost of the item in relation to the cost of the warranty. Research about the quality and history of the item online. If you decide to buy an extended warranty, make sure it covers what you expect as most warranties will not cover failure due to normal (but excessive) wear and tear.

Tipping way above your means

This is a hot button issue for many. There are services where tipping becomes mandatory because the business owner does not pay their employees a standard minimum wage. However, you should not feel compelled to tip above your means. Tipping is for services rendered (to your satisfaction or dissatisfaction). You should tip, but tip appropriately.

Tipping is between 10-20%. Check your bill to make sure a tip was not already included. Use the pre-tax amount for your tipping.

Splitting the check evenly at the restaurant

You’re out with friends and the bill arrives on the table. It might seem easier to split the bill evenly. Splitting the bill 50/50 may be okay if the meals were of equal value. Keep in mind though, if you’re paying 50% of a bill every time you dine out, but truly only responsible for 1/3 of the bill, you’re losing money. And your friend is taking advantage of you.

Occasionally, you can split the bill evenly. But pay for the food and drinks you only consume more frequently.

Paying full price for everything you buy

There is absolutely nothing embarrassing about using coupons. In fact, if you use coupons for every purchase, you’re keeping more money in your pocket. You should also ask for discounts at stores you visit. I once purchased a suit at Macy’s and the cashier gave me an additional 20% off at the register.

Before making any purchase, look for coupons, online codes, rebates, or other cash-back offers. Ask for discounts at the register.

Playing the lottery

The lottery is not your path to retirement and wealth. The odds of winning the lottery is astronomical. Getting hit with lightening is more likely at 1 in 161,000. No matter how many times you play the lottery it does not increase your chances of winning. Sure someone will win but the chances are it won’t be you. Winning is random and like Friday the 13th mythical.

Plan for your retirement. Small amounts can add up to big savings for your future.

 

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Jason Vitug

Jason Vitug is founder at phroogal, creator of the award-winning project the Road to Financial Wellness, and author of the bestseller and NY Times reviewed book, You Only Live Once: The Roadmap to Financial Wellness and a Purposeful Life.

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