If you are like most Americans and do not follow a successful budget, or one at all for that matter, it can never hurt to go through your monthly finances in detail to make sure the cashflow that is coming in is always more than what is going out each month. Go through bank and credit card statements line by line and see what is a necessary bill expense, and what could have been avoided, such as eating out, which is always a first place to start to cut. It is never too late to correct a spending problem, so take a look at some of the most telling signing that you are spending too much money.
Making Only Minimum Payments
Carrying over debt month to month means that interest is starting add up, and the larger the balance, the more that the monthly payment will go less towards principal. Making the minimum payment each month will do absolutely nothing to get you out of debt and you continue to use credit cards as a means of spending, you will continue to see the balance rise.
Unpaid Bills Piling Up
There is nothing wrong with spreading bills out across the month so that you can have roughly the same amount leftover each paycheck, as long as they are paid by the due date, or even up to fifteen days of grace period for the mortgage payment, but leaving bills unpaid is where you will get the biggest hit. Not only will you get a late charge, which could be substantial if you are already having trouble making payments, but after thirty days late is when it hits credit and could take years to come off.
Unnecessary Items Laying Around
We want the latest and greatest TV, phone, or tablet on the market, but it is when expensive items are collecting dust around the house is when maybe it was not such a smart purchase after all and could have best been spent elsewhere. The items you use daily such as your computer and phone should be kept up and current, but maybe a GoPro or drone was an impulse buy that you could not afford.
Using Credit Cards Instead of Cash
Credit cards can actually be a smart way of earning extra rewards with your purchases, but if you are not paying the balance off each month then there is no point. If you find yourself not having the money in your account to use a debit card for purchases, then using a credit card does not make a lot of financial sense.
Make a Good Living but No Savings to Show
If you find yourself making a good salary but have little to no money in the bank, then there is a definite problem. The more you make the more you should be able to save, but it does not always seem to work that way. Try pretending you make less and live off of that and put the rest into savings.