Stop Spending and Start Saving

Money Habits That Are Keeping Your Wallet Empty and How to Fix Them

Updated on March 23, 2024 Updated on March 23, 2024
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It’s easy to fall into bad habits that hurt our financial goals. Here are ten bad money habits and ways to overcome them. How many are you guilty of?

Like many areas of life, it’s all too easy to fall into bad money habits. Sometimes we just don’t know any better, sometimes we’re simply lazy. But neither excuse is acceptable. Bad habits are detrimental to all aspects of life, but bad money habits can be especially damaging. Break your bad habits!

1. You Don’t Track Spending


There is just no reason not to track your spending with all of the great technology available to us. I understand if you don’t want to sit in front of a spreadsheet noting every stick of gum you buy, but no one has to do that anymore.

If you don’t track spending, you don’t know where your money is going and how much you might be wasting every month. Spending $5 a day on coffee doesn’t seem like much if you never see it all added up, but it is hundreds of dollars a year which is a lot.

If you love buying coffee so much that it’s worthwhile to you, fair enough. Tracking spending doesn’t mean you can’t spend money on things you prioritize.

It just shows you what you’re spending overall which allows you to cut back on things you mindlessly spend on that are not priorities. So you have more to spend on your priorities.

How To Fix It

Mint is my favorite way to monitor my spending. It’s easy to use and gives a nice overview of your financial picture. You can also use it to budget and to track financial goals. Even if you just jot all of your spendings down on the back of an envelope for a week, it’s a start.

Combined with Mint, Tally can help you stay on top of your budget by keeping you on top of your overall spending day to day.

Once you start tracking, you are likely to find at least one nasty surprise. How much you spend eating out or buying stuff on Amazon probably.

2. You’re Not Investing

I know some of you still aren’t. I understand. I was a latecomer too. You’re afraid to, you don’t know how to. But if you want to retire one day, you must start investing. 31% of Americans of non-retirement age have nothing saved for retirement so you’re far from alone.

How To Fix It

First, of all, let go of your fear. You should be way more frightened to have nothing saved to retire on than you should be of putting your money into the market.

The easiest way to get started is to open a Betterment account.

Betterment mobile app

It’s fast, easy, there is no minimum and the fees are low. You can gain some knowledge and sophistication down the road and branch out into more complicated ways to invest, but open an account and get your feet wet.

Want to get your money under control?

This is our guide to budgeting simply and effectively. We walk you through exactly how to use Mint, what your budget should be, and how to monitor your spending automatically.

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3. You’re Easily Influenced

You have friends, family, and co-workers who have nice things. You watch television which shows you all of the things you could, neigh, must buy. You want nice things too.

Why should you drive a ten-year-old car when your neighbor has a brand new, fully loaded BMW? What will they think?! So you spend money that maybe you don’t have to keep up with the Joneses.

How To Fix It

What you might not know is that some people have nice things not because they are doing so much better than you, but because they are leveraged to the hilt. Every credit card is maxed out, they have no savings, their home has a second mortgage. No one talks about that at the neighborhood party or at the water cooler.

There is a theory that you are the average of the five people you spend the most time with. So if you are surrounded by people who value materialism, that might be what you value too. Rather than this kind of people, you should surround yourself with financial friends.

Money Habits That Are Keeping Your Wallet Empty and How to Fix Them

Money Habits That Are Keeping Your Wallet Empty and How to Fix Them

If you watch a lot of television, don’t watch it live. DVR it so you can fast forward the commercials or watch online where there are no commercials. This is especially effective if you have kids. A lot of advertising is targeted towards them so they less they see, they less they want.

4. You Throw Money At The Problem

Life is full of little hassles. Laundry is piled up, the house is a mess, the dishwasher is making a strange noise. All of these problems are easily solvable with money. You can send the laundry out, hire someone to clean your house and call a repair person to fix your wonky dishwasher.

But none of those things are free and some of them are not cheap either.

How To Fix It

Time is a commodity, sometimes a more valuable one than money. But how much time or skill do those little things require? Often, not a lot. Staying on top of life’s little chores will keep them from snowballing to the point you consider paying someone else to do them.

I know you don’t want to spend your whole weekend doing laundry and cleaning. But even if things are dire, you’re probably overestimating how long they take. It’s not like you have to beat your laundry against rocks down at the river.

You put it in the washer, do something else, put it in the dryer, and do something else. Folding and putting it away sort of sucks but that also doesn’t take too long. If there is a chore you really hate, time how long it takes to do it.

Mopping the floor for instance. I hate doing it. But when I timed myself doing it, it took ten minutes (I live in a small apartment though, you might have more floors!).

Mopping didn’t suck any less but you can’t really whine about something that only takes ten minutes.

Now, about your dishwasher. I know you are probably not a dishwasher technician but before you schedule an expensive service call, spend a few minutes googling the problem. It might be something you can easily and quickly fix yourself.

5. You Don’t Negotiate


You got the job or the promotion! Congratulations! I’m sure it’s well deserved. Now, how much are you making or how much more are you making in your new position? Whatever do they offer? That is the wrong answer.

How To Fix It

You got the job or promotion because you were better than everyone else they considered. That’s got to be worth something right? Gives you a bit of leverage. But so many people just accept what is offered. Some people even accept the job before knowing what will be offered!

How to Negotiate Anything with Daniel Green

How to Negotiate Anything with Daniel Green

Go in armed with information as well. You can use a site like this to find out what people in similar jobs in similar areas are making so you at least have a baseline to negotiate with.

6. You Don’t Shop Around

Not for the little penny ante stuff. You don’t have to drive to three stores to save twenty-seven cents on toilet paper. You would probably spend more in gas money than you save doing that anyway.

But if you are making a big purchase, a new computer or television for instance, don’t just buy the first thing you see.

How To Fix It

Do some research. And not just on price if you are making a big purchase. Make sure that what you buy not only has the best price, but is reliable and has all of the features you want too.

There are lots of comparison sites you can use to make sure you get the best deal. Make sure you are buying something at the best time of year too if it’s not an emergency purchase like a new refrigerator. Certain things go on sale at certain times of the year and if you can wait a bit, you will get a better deal.

7. You Don’t Take Free Money

If you are lucky enough to have a job that offers a 401k, you might be doubly lucky and have one that offers a match. You contribute and your employer matches up to a certain percent. This is literally free money.

How To Fix It

Sign up for the 401k, duh! This is one of the few things you should prioritize over debt. A 401k may be a big piece of your retirement money so take advantage of the matching that equals free money. And just because it’s offered now doesn’t mean it will be offered forever. Get it while you can.

8. You Pay A Premium For Vacations


I love planning vacations, it extends the pleasure of the trip. All that anticipation! Some people don’t and they pay so they don’t have to.

They book the flight that precisely matches the times they want to travel, the first hotel they see on Expedia and eat at whatever restaurant they come upon while out walking around. And doing it that way will cost more than a vacation has to.

How To Fix It

There are so many ways to travel well for less money. Being a bit flexible on your flight dates, or at least times, can save hundreds of dollars. You know that hotels are not your only, cheapest, or most fun options right? Home rentals, hostels, home shares, there are tons of choices that aren’t some generic hotel in the city center.

It’s fun to stumble on a great restaurant just strolling around but I love food too much to leave it to that kind of chance. Researching food and restaurants is fun! Just spending thirty minutes doing so will get you better and cheaper food.

Discovering the World on a Budget: 6 Steps to Traveling Cheaply and Comfortably

Discovering the World on a Budget: 6 Steps to Traveling Cheaply and Comfortably

9. You’re Impulsive

Oooh, look! A shiny thing! I’m going to buy it. No! You’re not five. You’re an adult and one of the many crappy things about being an adult is that you have better impulse control than a five-year-old. You can’t just buy whatever strikes your fancy.

How To Fix It

Shop with a list. For everything, groceries, clothes, shoes, presents. I like food and cooking and one big way I curbed impulsive grocery spending was to stop going to Whole Foods and start shopping on Fresh Direct. Not walking by the cheese section saved me about $30 a week.

You can still buy things not on your list when you buy things online but you have to search them out rather than being forced to walk by them on your way to the checkout.

Use another kind of list for bigger purchases. A thirty-day list. If you see something you really want, write it down and then wait. If at the end of thirty days you still want it, it’s more likely to be a genuine need than a momentary want.

10. Your Goals Are Generic

You have financial goals at least and that’s a start. But do your goals read, “Save for a house, save for a vacation, save for retirement?”

That’s too general. What do those things mean?

How To Fix It

Be specific. Calculate how much houses you can afford and then calculate at least a 20% down payment. Where do you want to go on vacation? A weekend trip to the mountains will cost less than a week in Paris. At what age do you want to retire? When you’re 40 or when you’re 60?

See, those are all very different things. The more specific you are, the clearer your goals will be and the easier it will be to build a plan to achieve them.

Many of us are probably guilty of at least one of these things. But none of them require a major upheaval to break. Just make the small fixes suggested and you’ll be on your way to being bad habit free with a fatter wallet!

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Candice Elliott - Senior Editor Candice Elliott is a substantial contributor to Listen Money Matters. She has been a personal finance writer since 2013 and has written extensively on student loan debt, investing, and credit. She has successfully navigated these areas in her own life and knows how to help others do the same. Candice has answered thousands of questions from the LMM community and spent countless hours doing research for hundreds of personal finance articles. She happily calls New Orleans, Louisiana home-the most fun city in the world.

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