Let’s examine bad spending habits that lead to debt.  Running into debt is quite easy, especially when you have no budget or discipline.  Most times, it is our spending habits that lead us into debt. This article considers those bad spending habits and how to avoid them. What are these bad habits? Let’s see.Bad Spending Habits That Lead To Debt

Bad Spending Habits That Lead To Debt : Overspending

If you have a budget, you will easily evaluate this. A lot of people’s total expenses in a month doubles their incomes. Many buy goods on impulse or because others are buying. Many people finish their savings, borrow and even use their credit cards very frequently.  This can happen gradually until you run into a serious debt crisis. What can you do? Live within your means, write a budget and stick to it. Buy only what you can afford.

Bad Spending Habits That Lead To Debt : Making Ordinary Purchases With Credit Card

Use cash  to make everyday purchases such as groceries, gas, clothes, and entertainment. A credit card is not for daily spending. Do not use your credit card for consumable purchases.

Even when you want to enjoy reward programs like cash back, miles, or points by charging more on your credit card. Do it within your means, do not charge for what will keep you in debt at the end.

Using Credit Card When You Have Cash and Paying Off Debt with Credit Card

You have been using your credit card even when you have cash. Many people prefer to use their cards so that they will not dip their hands in the pocket to pay. Ironically, they do not also save the cash for credit card payment at the end of the month. They still spend the money in other things.  At month end, they already have debts they cannot pay.

Moreover, paying off debt with credit card is not good but many do this. The fact is that you are only incurring more debt.

To stop these, use the money you have to pay for your purchases. Do not keep it in your pocket. The fact is that you will definitely pay for your purchases even if you do not want to.  Credit card on its own is debt. No need of using debt to pay for debt.

When you use credit cards to pay off other cards and loans to pay off other loans, you’re not paying off anything. You’re just shuffling your debt around and incurring more debt each time you do so. Do not use your credit.

Making Balance Transfers

Making a balance transfer is more than you think. It is only advisable when  you transfer a balance from a high-interest rate credit card to one with a lower limit. It comes with a fee  as well as origination fee. Balance transfers cost you more and runs you deeper into debt.