Groundhog Day might be a fun movie to watch, but repeating your mistakes is everything but fun. Making the same money mistakes will cost you more than you can imagine.
February 2nd is Groundhog Day and besides having Punxsutawney Phil telling us we’re in for six more weeks of winter in 2021 because he saw his shadow, there is the well-known movie starring Bill Murray, playing another Phil, who gets to relive this day over and over again until he breaks the cycle of mistakes he keeps making.
Come to think of it, 2020 and the whole COVID-19 chapter looks very much like that Groundhog Day. However, there’s nothing fun in making the same money mistakes over and over again. If anything, it will cost you. So, let’s leave the repetition to this delightful movie and make sure you don’t repeat your financial mistakes.
1. Common Finance Mistakes People Repeatedly Make
In order to figure out a way to break out the cycle of mistakes you keep making, we first must identify them.
Going overboard during the holidays
Regardless of how much money you make, spending more than you have is too easy over the holiday season and then get to pay for it throughout the year. As long as you factor in the holiday and stick to your budget, you’re good.
Being late with your bills
Forgetting to pay the bills can happen to anyone as life simply gets in the way. Besides including late fees, the reality is that only one late payment can hurt your credit score.
Failing to Save
Today’s world has too many people living from paycheck to paycheck. But not being prepared for emergencies can sink you into debt in a blink of an eye.
Overdrafts
Besides costing you more money due to overdraft fees that can only get you deeper into a rabbit’s hole, if you get reported, overdrafts can also damage your credit score.
2. Tips for Financial Success
Resolutions are a New Year thing but when you begin is less important. What is important is what you do to ensure you’ll be successful at following them through.
Get Paid What You’re Worth
As simple as it sounds, many people struggle on this front. As long as you know your skills are sought after and you are confident about what you are bringing to the table, don’t agree to less than what you deserve. Being underpaid even $1,000 a year can have a significant cumulative effect on your working life.
Spend Less Than You Earn
No matter how much you earn, you will never get ahead if you spend more than you earn. A little cost-cutting effort can go a long way.
Stick to your budget
Having a budget will help you know where your money is going and ensure you will have enough to meet your needs, without getting into debt. Another thing that budgets help with is identifying areas where are spending more money you should. For example, many people don’t pay attention to their monthly household bills like their utility bills which can vary significantly depending on the rate of your provider. You should check low-cost providers in your area like Gas South and see if you could be saving money on your monthly bill.
Treat savings as a priority
The truth of the matter is that if you wait until you’ve met all of your other financial obligations, chances there won’t be anything left for your savings account. You need to treat your savings as a fixed expense, even if it’s as little as 5% of your monthly income.
Takeaway
Bill Murray’s unique sense of humor does make Groundhog Day hilarious but there’s nothing even remotely funny about making the same money mistakes over and over again. February 2nd is already behind us, so what are you waiting for to get back on the right financial track and avoid a Groundhog Day scenario of your own?
