Chances Are You’re Making A Home Finance Mistake
If you are one of the millions of Americans working to save for a down payment on your first home, you know that it can often feel like an uphill battle. Experts say, however, that avoiding the following common money mistakes can increase your chances of accomplishing your goal:
Thinking in terms of a “monthly” budget
Recent studies show that creating an annual budget, rather than a monthly one, leads to more conservative spending among consumers. This is because most of us tend to play it safe when budgeting annually, never knowing what expenses or financial changes the future may hold.
Using credit cards with rewards
Credit card rewards programs, such as those that let you earn cash back on purchases or rack up free travel miles, can seem like a great deal. However, researchers say these credit cards encourage a phenomenon called “purchase acceleration,” which causes consumers to buy things they simply don’t need, continuing a dangerous cycle of debt.
Overspending on gifts
Were you among the majority of Americans who spent at least $900 on holiday gifts last in 2016? Each year, many consumers find themselves overpaying for presents, especially when waiting until the last minute. Planning ahead – and setting a budget – ensures you won’t take on more debt or borrow from your savings when the holidays roll around.
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