6 Ways to Stop Sabotaging Your Finances

Before you resolve -- yet again -- to take control of your finances, find out if you're the one who is sabotaging them.

With the new year comes a slew of New Year's resolutions. If you've found yourself saying this will be the year you take control of your finances one too many times, it may be because you're sabotaging your efforts.

Most of us do it, either consciously or subconsciously. Like learning to ride a skateboard though, learning to manage your finances is an acquired skill. It truly does not matter how often you've fallen off, just as long as you plant your feet firmly and try again.

1. Sabotage: Not budgeting

A Debt.com survey showed that 33% of Americans do not budget their money (although 93% believe everyone should). It's easy to understand why a person would be reluctant to sit down with a pen and paper and create a monthly budget: It can be a bummer. In its simplest form, a budget shows how much money you bring in each month and how much you spend. If you're spending more than you're bringing in, it's scary. If you have enough to pay bills but feel like you never get ahead, it can be depressing. 

Do this instead:

Why not view your budget as an ally, a tool you will use to meet your financial goals? For example, let's say your bills are $200 more than your income. Use your budget to find places where you can trim the fat, like subscription services, primo cable packages, unused gym memberships, alcohol, eating out too often­­­­ -- or wherever the fat may be in your case. 

If there's no fat to be trimmed, your budget will tell you exactly how much extra you need to earn each month, taking the guesswork out of your finances.

2. Sabotage: Building an impossible budget

You know what makes a budget hard to stick with? Treating it like it's a prison guard that won't let you do anything you enjoy. We can all create budgets that choke the fun out of our lives, but why?

Do this instead:

Do you love gaming, movies, or trying new restaurants? You may not be able to experience those things as often as you once did, but you should not cut them out of your budget entirely. Say you normally buy a new game every two weeks. Cut it down to once a month and save the difference or pay down debt.

3. Sabotage: Not saying no

After a hard day at work, it's tough to tell ourselves no. We feel as though we deserve a reward for the hours of work we put in. And yet, the reason we need to work so hard is that we have trouble saying no. It's an endless cycle.

Plus, there's the issue of stress spending. According to a 2017 study by Credit Karma, 52% of survey respondents said they sometimes shop to deal with stress, anxiety, or depression. Of that group, 60% admit to stress shopping at least once a month.

Do this instead:

When you have the urge to spend money, ask yourself if it is something you need or want. Figure out how many hours you will have to work to pay for it. When we deny ourselves something we don't need, we're saving money for something we do need.

We tend to replace one habit with another, so when you're tempted to stress shop, find something more productive to do with that energy. Take a walk, call your grandmother, go to a gallery opening, or read a book you've always wanted to read.

4. Sabotage: Caring what other people think

If you find yourself dreaming about how impressed other people will be with something you buy, you may have a bad case of Keeping up with the Joneses.

Do this instead:

Nothing is ever quite as perfect as it appears. Your friend driving a $60,000 car may have a lease he can barely afford. The couple in the $1 million home may be mortgaged to the hilt. Focus on how you feel. Do you have a job you enjoy? Are you proud of the way you treat people? Are you living each day to the fullest? Ultimately, it doesn't matter what anyone else thinks of you, so practice asking yourself what you think about the financial decisions you're making.

5. Sabotage: Making spending easy

It takes me approximately two minutes to buy toothpaste online. I have my credit cards stored, know where I want to shop, and could probably complete the process in my sleep. I'm here to tell you, that it's too easy.

Do this instead:

A few months ago, my husband and I adopted a new budgeting practice. We pay bills like mortgage, car payment, and utilities automatically through our bank, but for everything else we pay cash.

Sliding my debit card to complete a transaction never stung quite as much as handing over cash. I know it comes from the same place, but there's a greater awareness of how much I'm spending when I make a cash payment. Also, once the cash for the week is gone, it's gone.

6. Sabotage: Failing to imagine the future

As the old folks in the family used to say, "God willin' and the creek don't rise." You have managed to convince yourself that there will never be a job loss, serious illness, or any other event that will require an emergency fund. You also can't imagine yourself getting old, so you've postponed saving for retirement.

Do this instead:

Save whether you feel like it or not. There will be an emergency, even if it's just a furnace on the fritz or water in the basement. And if you're fortunate, you will age. And you might be surprised to know that saving is not something that only benefits us in the future -- there are immediate perks. 

Putting money in an emergency fund offers a sense of accomplishment and can help us sleep better at night. Putting money in a retirement account can offer a tax break that hits at just the right time of year. Plus, if you are going to imagine getting old, why not imagine being an incredibly cool senior citizen who has the cash to live in comfort?

It is impossible to predict everything that's going to happen in life, and that's part of the fun. What we can do is take control of finances so that we'll feel more prepared, come what may.