
Bank News & Financial Literacy
Poor financial habits to leave behind in 2024
As the year comes to a close, now is the perfect opportunity to evaluate your financial habits and identify areas for improvement. The daily financial decisions you make can shape your future stability and goals. Leaving behind poor financial habits in 2024 can set you up for a brighter and more secure 2025.
Here are a few examples of habits you can leave behind in 2024:
Neglecting Emergency Savings Without an emergency fund, unexpected expenses—like medical bills, car repairs, or job losses—can derail your finances. Experts advise that you should aim to save at least three to six months’ worth of all your living expenses in a separate, easily accessible account. | Living Beyond Your Means Overspending on non-essentials is a habit that can quickly lead to debt. Many people rely on credit cards to finance a lifestyle they can’t afford, which can cause high interest payments and financial stress. To combat this, create a realistic budget and prioritize saving over splurging. |
Avoiding Your Retirement Fund Procrastinating on retirement planning means missing out on the benefits of compound interest. Start contributing to a 401(k), IRA, or other retirement account as early as possible, even if it’s a small amount. Many employers will match a percentage of your retirement contribution. | Not Tracking Your Spending Small, frequent purchases can add up, leaving you wondering where your money went. Use budgeting apps or a simple spreadsheet to monitor expenses and create a limit you want to stay below for each spending category. Awareness is the first step toward better financial choices. |
Ignoring Financial Education Oftentimes, people avoid learning about personal finance because they find it intimidating. However, knowing basic financial principles can empower you to make smarter decisions. Take advantage of free online resources or attend workshops to improve your knowledge. | Impulse Purchases Retail therapy may provide short-term satisfaction but can lead to long-term regret. Practice the 24-hour rule: wait a day before making non-essential purchases to ensure they align with your priorities. You may find after a day of waiting you don’t need the item or forget about it altogether. |
Source: Wisconsin Bankers Foundation