Home Personal Finance 7 bad money habits to ditch in 2023

7 bad money habits to ditch in 2023

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I always like to make New Year’s resolutions. Success or failure is at least trying to develop better habits, or push bad habits to the curb.

In fact, 7 in 10 American adults say they will set goals for themselves at the beginning of the new year. Gallup poll Taken at the end of 2022.

Interestingly, goal setting is more common among young Americans, found by Gallup. 62% of adults over the age of 55.

Most Americans say they will focus on improving their health and fitness in 2023, and nearly half will do the same for finances, Gallup found.

If you haven’t set a financial solution yet, let me help you.

Choose New Year’s quotes instead of resolutions

1. FOMO on crypto. I hope that in 2023, the fear of losing cryptocurrencies will disappear. In 2022, there were many examples of how risky buying cryptocurrencies can be. Last year, several major cryptocurrency companies went bankrupt. Sam Bankman-FriedFormer CEO of FTX, one of the world’s largest cryptocurrency exchanges. Paid on a fraud charge.

Federal banking regulators Joint statement This week, we highlight crypto risks for banking organizations. There is no federal insurance to cover crypto exchange failures. “Events over the past year have been marked by significant volatility and vulnerability exposure in the crypto sector,” the regulator said.

Cryptocurrencies are highly speculative and can be financially ruinous for the uninformed investor.

Opinion: Why The Crypto Bubble Finally Bursted

2. You have credit card debt. According to the report, the average credit card interest rate at the end of 2022 was 19.77%. CreditCards.com.

Credit card debt will be even higher in 2023 as a result of the Federal Reserve’s fight against inflation. The Fed has noted that although inflation has declined, it is still “unacceptably high” and will likely lead to further rate hikes throughout 2023.

Average credit card interest rates will almost certainly continue to rise into the new year as a result of the Federal Reserve’s actions, said senior industry analyst Ted Rothman. bank rate When CreditCards.com.

3. Get a tax refund. According to the latest IRS figures for the 2022 filing season, the average tax refund amounted to $3,253, up 13.6% from the previous year. Many people love to pick up what they consider to be windfalls and forced savings plans. But inflation is reducing your paycheck, so you’re better off making money later in the year, especially if you’re rolling high-interest credit card debt. Here’s why:

If you intentionally get a refund, you are lending the federal government interest-free money. When the savings rate was very low, the economic losses were not great. The highest FDIC-insured liquidity savings accounts currently yield just over 4% annually, according to Rothman.

Inflation is another reason why you shouldn’t aim for big tax refunds

For proponents of the series of refunds, I understand that you may struggle with managing your money. This is not to say that the effects should not be reconsidered.

If you’re saddled with a credit card with 20% interest, waiting to get a lump sum tax refund can cost you money. And that’s bad money management.

4. Eating out too much. Typical household spending in 2021 $3,030 per year About eating away from home, according to the Bureau of Labor Statistics (BLS).

This is a way to surprise you to eat out less. Add up all the money you spent on eating out last year. He asked one family member to do this for a month and found they had spent his $1,500.

Realistically, you’ll probably continue to eat out, but set a goal to cut your eating out expenses significantly this year. Think about what you could do with that money. Build an emergency fund, pay off debt, or increase your retirement savings.

5 easy steps to a healthy New Year

5. Autopilot bill payment. Automating payments is a great way to avoid late fees. But inertia can kick in and you’ll end up paying for subscriptions you don’t use. The monthly fee of $4.99 may seem affordable. However, you can add multiple services.

of BLS is an American In 2021, the average annual price for “cable and satellite TV services” is $574.75.

Record what you read, hear, and watch on TV or on your mobile device for a month. If you only watch one or two shows on your streaming service, it might not be worth the money.

In general, using automatic payments is a good idea, but if you set it up and forget it, you’ll incur monthly charges for services you no longer use or need.

6. Worried about repair costs. Naturally, you worry about the cost of repairing your car or replacing faulty appliances. But that fear can lead you to buy expensive extended warranty plans that you don’t need or make it difficult to use.

as a consumer report warn repeatedlymany extended auto warranty policies are a bad deal. review A consumer checkbook of home warranty plans found that they are rarely worth the price or hassle.

In many cases, it’s better to save the money needed for car repairs and appliance repairs. Include expected repair costs in your budget.

FTC Tracks Companies Behind These Annoying Auto Warranty Robocalls

7. Spend money on junk food. Out-of-pocket health care costs for Americans increased by 10.4% in 2021, according to the Centers for Medicare and Medicaid Services Annual National Health Expenditure. report.

Some health conditions are preventable. bad food choices contributed to high rate of obesity 41.9% of adults in the United States are at increased risk for many serious health conditions, including heart disease, stroke, and stroke. type 2 diabetes.

Over 1 million American diabetics provided insulin in the past year

“Costs to manage diabetes can become unsustainable.” According to the American Diabetes Associationnotes that the prices of the four most popular insulins have tripled over the past decade.

One of my New Year’s resolutions is to improve the quality of my diet.

eat right When exercise regularly Good for your health and finances.

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