Over time, it becomes easy to get lulled into thinking your financial picture is fine and completely normal. You grow accustomed to the way things are and rarely question if there is a better way. But subtly, your financial situation is eroding. And if you don’t find out more about it and address it, you will come face-to-face with a financial disaster.
Before a financial disaster arrives, there are some warning signs. Here are six signs that you need to reevaluate how you handle your finances:
1. You are not able to give
The Bible tells us we are to be joyful givers. And the starting point of your giving should be your local church. There are many great reasons to give, but none more important than worship to God. If you feel that your current financial situation does not let you give joyfully, a red flag should go up.
2. You are not able to save
For long-term financial health, saving is essential. You should be setting aside a portion of each paycheck into a savings account and into a retirement account. Not setting aside savings is an indicator that you are living paycheck to paycheck. It is also a sign that any unforeseen financial cost could cause significant turmoil, in case you skip the cost reduction procedures.
3. You play the credit card balance transfer game
Transferring a credit card balance from a card with a higher interest rate to a card with a lower interest rate is not something to celebrate. Though it is good that you have a lower rate, there is a clear, underlying issue that needs to be addressed. How did you get into this position to begin with? For many, credit card debt is simply the result of a lack of patience and financial discipline, the learning of investments strategies, such as put vs call, could really improve the chances of have better finances. Unless broken, the absence of this virtue and practice will lead to long-term consequences.
4. You hate the end of the month
You hate it because you have run out of money. And you are scrapping to get by until the next paycheck. It is a cycle that must be broken. Because often the decisions that created this cycle will cause you to hate more of the month, not less, in the future.
5. You frequently fight with your spouse over money issues
Financial stress causes marital conflict. It is a weight both husbands and wives feel. Married couples must be on the same page with their finances, moving in the same direction. This leads me to my final sign.
6. You don’t have a plan
What are your financials goals? How are you going to reach them? Plans bring clarity to financial decision-making. It is easy to make poor financial decisions when you do not have any guidelines on how money is to be handled in your household. Set goals to give, save, and pay off debt. Then create a plan to help get you there. You will be surprised what a difference a few goals and a plan make.
What about you? What other signs indicate disarray in someone’s personal finances? Please place your comments in the section below.