Are these five money habits making sabotaging your financial progress? Breaking them might help solve some of your budgeting woes.

When it comes to managing your money, what works for one person does not necessarily work for another. We spend a lot of time with our clients determining the solution that best fits their needs and personalities. There are a few habits, however, we try to halt as quickly as possible.

Bad Habit No. 1: Multiple accounts with no defined purpose

It’s one thing to have one checking account for paying bills and another for your “fluff spending money” for the month. However, if you have multiple checking or savings accounts and you cannot clearly define which each one is being used for, you have too many. Money should be simple and straightforward. Banks these days charge fees for having multiple accounts. We see individuals with three checking and three savings accounts, each with a $25 transfer each month (to avoid the fees), and no explanation as to why.

Solution: Close the extra accounts.

If you miss them after a few months, you can always reopen them. We promise the bank will welcome you back with open arms! But at least try cutting the before you claim you absolutely 100% need them all.

Bad Habit No. 2: One spouse handles the finances, the other is completely oblivious

It’s normal for one person in a relationship to be more inclined to pay the bills or balance the checkbook. That is completely okay. Both of you don’t need to physically sit at the kitchen table and write your checks together. But the person who isn’t responsible for paying the bills cannot be completely uninvolved either. Sometimes I see couples for their very first financial coaching appointment where the woman is crying because she’s so stressed about money. Her spouse? He has no idea why she’s crying. He doesn’t feel the stress. (BTW, this goes both ways. The women are not always responsible for the family finances).

Solution: Step Up Your Communication

Easier said than done, I know. We could have an entire podcast about how couples can and should communicate about their finances. It all boils down to making a commitment to share your finances and sticking to it. Ideally, you want to aim for twice each month. Sit down with your spouse, pour a glass of wine (if that’s your thing), and try to make the conversation as fun as possible. If you handle the bills, the worst thing you can do is only involve your spouse when something goes wrong. If he is only brought on board to put out fires, this won’t help the situation. Make sure you’re sharing your small wins too!

Bad Habit No. 3: Saying “need” in place of “want”

I need a better cell phone. I need a landscaper. I need a new car. I need nicer clothes. I need to go on vacation. The list goes on and on. And sometimes these needs are legitimate. People do have to upgrade their cell phones sometimes. People do need to buy new cars when theirs breaks down. It’s important to know though when you’re replacing a need with a want. We all want a lot of things. But giving in to your wants disguised as needs will make your budget go south very quickly.

Solution: Change your choice of words and your mindset will follow.

You can absolutely have all the things listed above and even more, but realize they are wants and not needs. Ask yourself, “What is it that I truly need?” Everything else is a want. The needs are paid for now. The wants are saved for and become goals you set for yourself.

Bad Habit No. 4: Paying bills late

Paying bills late costs you so much money. I have clients who easily spend over $100 each month on late fees. And the kicker is, most of the time they have the money to pay the bill. They just forget to or they weren’t paying attention. That $100 is lost for good when it could have toward something they were actually working toward.

Solution: Systematize. Make a list and check it twice

We have said it time and time again, the traditional way of budgeting does not work. That’s why one of the first steps with the Plan Ahead Budget is making a list of all of your bills and sorting them by the due date. Not the amount. Sorting your bills by the due date is not going to help you keep track of paying them. Sorting them by the due date does.

For more tips on how to create a realistic budget that helps you plan ahead and get ahead financially, check out our How to Budget Guide.

Bad Habit No. 5: Not paying attention

When was the last time you looked at your cable bill? How about your pay stub? I save my clients sometimes hundreds of dollars simply by canceling a service they didn’t even realize they were paying for. It’s so common nowadays to sign up for a trial membership and forget to cancel it. When you’re not paying attention to your bills, this is bound to happen.

Solution: Pay attention

You don’t have to necessarily look at every single bill, every single month, but you should be reviewing all of them a few times each year. This is especially important if you bundle your phone, internet, and cable services. It’s also especially important if you have a credit card. At some point, you may have signed up for the “credit monitoring” service through your credit card company without even realizing it. At the very least, make sure you review your credit card statement each month to make sure all of the charges were made by you.

If you have any of these bad habits, we understand. They are issues we see time and time again with our financial coaching clients. But now that you’re aware of it, make a conscious effort to change. Remember the most important thing is progress over perfection. Don’t let a few stumbles trip you up from inching closer to seeing your finances and financial habits more clearly.

Let us know in the comments: Do you have any of these bad habits? What are some of your worst budgeting habits?