Are you Damaging Your Finances?

Are you finding yourself in a financial rut? Struggling to make ends meet? Or failing to maximise your savings capacity? Chances are there are several habits that unintentionally may be doing more damage to your finances than you are aware. Read on for some steps that you can correct so that you can maintain control of your financial situation and ensure you stay ahead of the curve.


A no-brainer really. If you fail to live below your means then you will constantly be playing catch-up with your finances. Look to make change. Make an effort to increase your earning potential. Perhaps seek another stream of revenue, a second job or seek a better paying job if you feel undervalued. Alternatively, look to lower your expenses. Take a good hard look at your expenditure and where you can make cut-backs to limit your spending ways. It’s about being in control of your current financial situation to set yourself up for future success.

No budget – or a failure to stick to one

A budget goes hand-in-hand with one’s ability to live within their means. Yes, a budget does require some work. Firstly, to establish and then also to stick to. Your budget should reflect your priorities to help you meet both your financial obligations and also financial goals.

Goals, Goals, Goals

No goals means no direction. We need direction and a sense of purpose to help ourselves constantly move forward in life. It gives something to work toward. Your budget will be set in accordance with your goals to help you achieve the things you want in life, faster and more easily. Whether it be overcoming debt, establishing an emergency fund, buying a home or saving toward a holiday or new car. Whatever your goals are, you need a sense of purpose and it would be encouraged to constantly evaluate your goals to ensure you are on the path to success.

No emergency fund

Failing to have an emergency fund is like driving your vehicle around without brakes. You are effectively asking for trouble. What happens if you are made redundant? Confronted with a lofty vehicle repairs bill? Or an unexpected medical bill? You get the idea. An emergency fund is your security and buffer to prepare for the unexpected. It’s a peace of mind step more than anything else to give you greater financial freedom. Check out 8 reasons to establish an emergency fund for further assistance.

No savings or failing to maximise savings potential

Having a savings fund allows you to make things happen. The dream holiday, the new car, the big-ticket purchases that may otherwise not be possible. Make an effort to contribute to your savings fund regularly. Not sure how much you should be putting aside? Remember any amount put to savings is better than none at all. For further savings options check out Savings Accounts vs Term Deposits, what is the best fit for you?

Failing to pay off the credit card (in full) each month

We know that credit card spending is best to be avoided, yet the temptation often prevails. We are human. Perhaps better explained, is that if you are prepared to use credit cards that you better be prepared to make the repayments in full, within the credit cards monthly period. Paying the minimum amount is a big mistake. Aim to repay the full, or as much credit as possible to avoid the amount owing on your card to build beyond your control.

Keeping up with Joneses

Ever find yourself making a financial decision based on a comparison to others? My flatmate purchased a brand new television, my neighbour bought a new car, my friend is going on an overseas holiday. Not one to be left behind, this entitles me to make a similar purchase decision, right? All too often this ‘keeping up with the Joneses’ mentality persists in today’s ‘want now, worry later’ landscape which places us in a poor financial position if we are not sufficiently equipped. It may be difficult, but strive to avoid this behaviour as the main determinant in you informing your key, personal finance decisions.

Failure to evaluate & re-adjust = insanity

You know the definition of insanity? “Doing the same thing over and over again and expecting different results.” Take that approach and apply it to your personal finances. If you keep making the same moves and same mistakes with your personal finances then do not expect to make inroads. Make change. Constantly reflect upon your personal finance goals and the steps you are making to achieve them. If adjustments are not made, then you will remain in a financial rut, going through the motions and failing to maximise potential and achieve personal finance success.