7 Bad Financial Habits that may Bankrupt You

Bet you really want to know what are the 7 bad financial habits that are strong enough to cause bankruptcy? 

Powerful title, huh?

However, in truth, there are habits which can cause this. The good news is, though, bad habits can be broken and new, good habits can be supplanted in their stead. It is never late to break a bad habit, especially if it is affecting your personal finance adversely.

Now, without further ado, here are the 7 bad habits you need to break, or you just might go broke.

1. Stop spending more than your income: This alone will bring you closure to debt and possibly bankruptcy, unless you are careful. Your income is limited, let’s face it. Let’s not spend more than you earn.

2. Don’t ignore your bills: You’ll be surprised to know how many people do this, and thus continue to fall in debt. People take loans, and then when the time comes to pay EMIs, they procrastinate. People also tend to give themselves excuses to justify their actions. Thus, their interest rate for such loans continues to rise. This is the way many people fall into a debt cycle, and ultimately become bankrupt.

3. Don’t use your credit card like it’s free money: Banks and other lenders want you to think that credit card is free money, and it can be if you use it correctly, but it can also bring you a world of trouble. Credit card EMIs are high. If you use your credit card like an ATM, by the way, the interest rate is much higher.
   
   If you use credit cards in the right way though, your loans can become interest-free. To do that, you need to pay back the loan before the due date, after which the lender charges interest.

4. Don’t think that you are not smart enough: In today’s time, you need to take control of your own finances. You need to plan for your own retirement, save for an emergency fund, have various insurances, and more. It is all up to you. The excuse that all this is too complicated and difficult doesn’t cut it anymore. You can research on and learn about almost anything online. Besides, you can always hire a professional finance planner to help you out.  

5. Don’t make saving hard: You may have habits, such as too-frugal spending, which is saving impossible. If you spend on things on the drop of a hat, it is high time you smell the coffee of reality.

6. Don’t complain about your paychecks: Complaining about your salary will not do any good for you. On the contrary, it will only ensure that you remain in the same situation. Instead, take up side gigs, try freelancing, start a small business, to make more money.

7. Don’t think that money brings happiness: While it is true that money brings happiness, it does so up to a point. There are other things which bring you happiness, including giving money to charity.

As you have seen, these are the bad habits you need to break if you want to bring your personal financial situation out of debt and even bankruptcy.