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They might not seem comparable at first glance, but there are definite similarities between developing your physical fitness and improving your financial health. Both involve building healthy habits and sticking to them.
Working through this level will help you to decide on the helpful attitudes you want to keep, and determine ones you’d like to change.
In this module you will learn
- about common bad money habits
- what to do against them
- how to take the first steps in developing good habits
Once you’ve uncovered your assumptions about money and discovered its hidden meanings for you, it’s time to start tackling your financial habits. You probably have some money habits that are good, and some that are…not so good! We don’t know which bad habits you have, but we can show you some common examples to help you identify your own.
Chains of habit are too light to be felt until they are too heavy to be broken.
Buying on impulse
impulse purchases are all about emotion and anxiety. You can cut them down by making a rule to wait a while before buying anything. It doesn’t matter how long your cooling off period is – the main thing is that you stop and think about the decision. Do you really need it?
Failing to budget
if you don’t have a budget in place, you can’t make any plans for your money. Budgeting doesn’t have to be a big chore – you just need to know how much is coming in and how much is going out.
Credit card abuse
if you’re not paying your balance off each month, credit cards can have a terrible effect on your finances. Every pound you owe will cost you more in interest payments. Especially if you’re using plastic to live above your means.
Taking it easy
grabbing a meal out or a takeaway can be a well-deserved treat, or perhaps a necessary evil when life’s getting on top of you. But if it becomes a regular habit, it can drain your bank balance. Putting extra effort into making meals or drinks yourself can pay off in the future.
this one’s simply human nature – saying you “don’t have time” to draw up a budget, or “just this once” about another impulse buy that you really want – so it’s one of the hardest to resist. But the more you try to make plans and stick to them, the easier it becomes.
It’s time to be honest with yourself – do any of these habits seem familiar?
Taking the first steps
It’s not easy but it is straightforward to build new healthy habits. Identify your worst financial habits and take small steps every day to correct them. And target the healthy habits that work best for you, and use whatever help you need to achieve them. Whether it’s using an app to keep track of your expenses or setting up automated withdrawals from your salary payments to your savings.
And as your everyday spending habits change, so will your overall financial situation, encouraging you to keep up the good work!
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Key takeaways and what comes next
Now, you’ve read about bad money habits and how to counter them. Furthermore, you have prioritised your top 3 good money habits to adopt and a checklist to help you... in other words, you have registered for your money gym, designed your workout plan, prioritised your exercises and packed your gym bag... all that's left to do now is... to actually go to the gym! But similar to physical exercise, it's better to start with shorter not too demanding exercises and do them regularly rather than trying to achieve that beach body within only a week. That's why we asked you to only select 3 healthy habits to start with - let's tackle those first!
Success is the sum of small efforts, repeated day in and day out.
In our next module, we will discuss how to put your gym squad together. In financial fitness terms that means starting to Talk about money with your friends which will provide feedback and inspiration to keep you going on your way of enhancing your financial health.