10 Ways You Disrespect Your Money

If you look after your money, it will look after you. It's something that financial experts, parents, and countless advice columnists will tell you, and with good reason. Ignore your money, and disrespect your finances, and you will come off worse for wear. But treat your finances with the respect they deserve, and you can look forward to stability, growth, and freedom. So, if you're disrespecting your finances in any of these 10 ways, it's time to put a stop to the behavior, or face the consequences.

1. You Don't Have a Budget

Whether you're flush with money at the end of every month, or you are always scraping to get by, there is no excuse for not having a set budget. You owe it to yourself to know exactly how much money is coming in each month; what the bills are, how much you should be setting aside for retirement and an emergency fund, and what you should be spending on things like food, entertainment, clothing, and so on. Without this budget, you are playing fast and loose with your money, and it can result in some financial hardships that can be avoided. You can also see just where you are spending, and wasting, your hard-earned money.

2. You Don't Store Receipts in an Organized Fashion

It's all well and good to keep every receipt, but if they are all over the house and garage, stuffed into junk drawers and nightstands, they aren't much good when you actually need them. It does not take a lot of work to have an organized receipt folder. Just purchase an alphabetized concertina folder, and place your receipts in the appropriate section each time you get home. Go through it every few months to remove receipts that are no longer needed (although if they are for tax reasons, keep them…for years). You can also scan your receipts and save them digitally. This saves room and makes them even easier to organize and reference.

3. You Max Out Your Credit Cards

Some people will tell you credit cards are just free money. These people have no respect for credit, and how it should be used. Credit cards, when used responsibly, are a fabulous way to securely pay for goods and services, giving you purchase insurance, fraud protection, and cash back or travel rewards. But if you don't use them correctly, you will pay the price.

By maxing out a credit card (or many cards) you are damaging your credit, and you are running up huge interest charges. Some people can only afford to pay the minimum, and when that happens, it can take years (or even decades) to pay the balance off. Use credit cards as a tool, but make sure you pay as much off as possible (ideally, bring the balance to $0 with each payment) to reap the rewards.

4. You Keep Spending the Equity in Your Home

Right now, the housing market is in pretty good shape. That means many of us owe considerably less on our mortgage than the home is worth, and that means equity. Lovely, lovely equity. Hey, it means the investment paid off, and you can take out a home-equity loan to pay off debt, make home improvements, or go on lavish vacations. Well, not so fast. A lot of people made that mistake the last time the housing market flourished, only to see house prices crash, and ended up with a mortgage that cost more than the home was worth. Your house should not be a piggy bank. If it's an emergency, and there is plenty of equity, it's certainly an option to take a little out to pay for something you need. But dipping into that equity too often, or spending it all, can lead to financial heartache.

5. You Live a Champagne Lifestyle on a Beer Budget

No matter how much money you have coming in each month, if you are spending more than you earn, this applies to you. Sure, you like the name-brand goods and fashions, and you must have your Starbucks every morning. But if your budget does not support that kind of spending, you are racking up debt that will have to be paid back sooner or later. It's possible you once had that bigger budget, but now have less due to a major life event (getting divorced, for instance). Sadly, you have to adjust. No more expensive pedicures and massages. No more fancy dinners that cost a small fortune. Your budget will dictate where you can go, how often you go, and how much you can spend. Listen to it. Ignore it, and you'll be in real trouble.

6. You Are Not Saving Regularly

This is not about saving money on deals and bargains, but rather, putting money away for the future. Every financial planner will tell you to pay yourself first, and it's good advice. Whether it's a 401K, an IRA, a savings account, an emergency fund, or ideally, all of them, you need to get into the habit now of squirreling away your money. Right now, time is your friend. The longer you have to go to retirement, the more money you can accumulate through compound interest. What's more, if anything bad were to happen that required access to quick cash, that emergency fund or savings account will be invaluable. Of course, it's easier said than done. Many Americans simply cannot afford to put money away each month, and something like an unexpected bill for $400 can put so many people in real trouble. Analyze your finances. Look at every cent coming in, and going out. Where can you cut back, to save money for tomorrow?

7. You Don't Have a Calendar of Bills and Payments

Many of us do the old "set it and forget it." Basically, we set up automatic bill payments, linked to a checking account or credit card, and let the automated system do the rest. This is great for avoiding late fees, but it can also be hazardous if you don't have a clear picture of your finances. If you set up a spreadsheet or simple Word doc, outlining all of the bills you have to pay each month, cross-referenced with when you get paid, you will see any potential issues that could arise. Can you schedule some of the payments to fall a day or two after you get paid, rather than a week before? Do you have a lot of bills coming out on one day? Are you cutting it a little too close with the mortgage, or paying late fees? This will all become clear on a financial calendar.

8. You Don't Check Your Accounts Daily

Checking accounts, credit card accounts, and all other sources of money should be checked at least once a day. This takes just a few minutes, but it can make all the difference. You may have several auto-debits come out at once, leaving your balance precariously low. You may be the victim of credit card fraud, which if left unchecked can spiral out of control. From spotting suspicious activity, to simply monitoring the credits and debits on each account, get into the habit of checking your accounts every day.

9. You Ignore Your Debt

Most of us have debt. Let's face it, who can afford to put down $400,000 in cash on a new home, or $45,000 on a new car? However, if it's all kept under control, and there is a plan in place to pay everything off, you're good to go. Problems arise when people accumulate a lot of debt from many different sources, and then choose the "head in the sand" approach. It's scary to acknowledge a lot of debt, and even scarier to figure out how to pay it off. So, why not just ignore it, pay the minimums, and smile? Well, ignoring debt is like ignoring the hungry wolf that is sat in the corner of the room with you. At some point, it will attack you, so you better have a plan on how to deal with it before that happens.

10. You Don't Check You Credit Score and Reports

In America, your credit score can be life altering. If it's high, especially in the 800s, you get amazing offers, low APRs, and a whole world of options. If it's low, you can be denied even the most basic offers, and may not be able to live with things many of us take for granted. Checking your credit reports is free, and should be done regularly to ensure you spot inaccuracies. Go to AnnualCreditReport.com and request yours (not freecreditreport.com, which is NOT actually free). You should also know what your specific credit score is, and this can be found via CreditKarma.com (again, totally free). Also, the three different credit-reporting agencies — Equifax, TransUnion, and Experian — should also be able to supply this to you.

In what ways do you respect your money?

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