We all know there are certain things that we can do with our money that will be good for us and our money. Unfortunately there are also some things you can do with your money that are bad for both you and your money. Knowing what these are can help you to avoid them.
One thing that is a definite bad money move is to use the equity in your home to pay of credit card debt. Experts say that this can actually lead to more debt. Find other ways to get your debt paid off without having to go into more debt in the process. If you have to get into more debt to get out of other debt, you should realize that is a bad idea and find another way to go about getting out of debt.
Do not borrow money from your 401(k). Many people think that this is okay to do. They say that they will pay themselves and their 401(K) back. The biggest problem with doing this is that you will lose out on the interest that the money you took out would have made if it were still in your 401(k) account. In addition to that sometimes there are fees for taking money out of the account early.
Another bad money move is stretching your money too far in order to buy a house. Doing this can set you up for a whole bunch of problems. With homeownership comes home maintenance. If you are barely able to pay everything every month what are you going to do if you suddenly have a problem with the house and have to have it dealt with right away? You most likely will not really have the money to deal with it, and with some problems putting off dealing with them will actually cause the situation and problem to get worse.
Thinking that you can do without a budget is another bad money move. In order to properly track your money that is coming in and going out you need to have a budget. This will show you what amount of money you need to put toward what and where you are putting too much money. This will help you find more money to put toward savings. Everyone needs a budget no matter how much money they have or where they are in life.
When it comes to bad money moves these can really hurt instead of help you. You need to be smart with your money. Throwing it around and not paying attention to where it goes can really cause you some financial harm. When it comes to debt you need to be careful as well. What you do to deal with your debt can really affect other areas of your life.
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