Common Financial Pitfalls... and How to Avoid Them!

It’s so easy for so many of us to fall into the trap of the little things that can set us back financially, even when we have the best of intentions to stay committed to our financial goals.  Here are 3 of some very common financial pitfalls, and even more importantly, tips on how to avoid them!


1. Impulsive Spending

Ever go to the grocery store hungry, and find yourself pulling more things off the shelves than you had initially intended?  Do you get a little click-happy when you’re shopping online, then have 10 items in your Amazon cart when you only planned on buying one thing?  Tempted by all the shiny and fun stuff on store endcaps and in checkout lines?  So much of what we buy is on impulse.  You’re not alone, and there are ways to reduce or even eliminate this!

How to avoid: Have a plan!

Don’t go grocery shopping without a pre-planned list (and stick to that list!).  Turn off “one click ordering” on your favorite online shopping sites, so you have an active barrier to just easily ordering whatever you wish (would you be as tempted to spend so much, if you knew you had to actively log in again and re-enter your payment information rather than just clicking a button?).  Set some time aside and make a budget plan for yourself.  Reward yourself when you stick to it (freely or inexpensively, of course!).


2. Using Credit Cards for Emergencies

As much as sometimes it is necessary to use a credit card for an emergency expense, it ideally should not be our first line of defense.  Credit cards can carry such high interest rates (sometimes upwards of 30%!) and if not paid in full, the balance carried over from month to month can grow very quickly.  It’s far better to use savings for emergencies wherever possible, and then use credit cards as an absolute last resort.

How to avoid: Build an emergency savings!

A good goal is to have 3-6 months worth of your monthly expenses in an emergency savings account, but don’t let that goal scare you.  START SMALL!  Saving just $50 a month into a separate savings account will get you to $1,200 in only 2 years (excluding any interest you may earn).  Once you hit a small goal (say, $250 in a savings account), challenge yourself and up your savings by 10% and see how much more quickly you can hit your next goal.  It may even be fun…!


3. Ignoring Your Retirement Fund

Planning for retirement should be part of your long term financial goals.  It takes more and more money for people to be able to retire comfortably, and if you’re not prepared, you just may end up having to work a lot longer than you had initially hoped for.

How to avoid: Start saving NOW!

It’s never too late to start!  Does your employer sponsor a retirement plan such as a 401(k) or 403(b)?  Start contributing to it TODAY!  Be sure to ask if your employer participates in company matching, and maximize your contribution to get the most out of this benefit.  Every little bit helps.  Don’t fall into the mindset where you feel like since you can’t contribute a high % of your income then it’s not worth it.  It is absolutely worth it, and even 1% of your income is better than 0%.  It helps you get into the habit of saving, and it adds up faster than you’d think!


To speak with a knowledgeable financial counselor about how to make your money situation work for you, give us a call at (716) 712-2060 today!  CCCS of Buffalo is committed to assisting our community in meeting your financial needs!


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