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Worst decisions involve your finances

By Marcie Geffner · Bankrate.com
Monday, December 23, 2013
Posted: 6 am ET

A recent poll by the National Foundation for Credit Counseling found that 80 percent of respondents said they'd made their worst decisions in the area of personal finance.

About 9 percent of the respondents said they'd made their worst decisions in their marriage, while 8 percent picked health and only 3 percent selected their job or career as the source of their worst decisions.

That lopsided finding is no surprise, given that the poll of 1,349 people was conducted via the website of the NFCC, an agency for consumers who struggle with their finances.

Still, the poll shows people can recognize and admit their mistakes, and that is "a good sign," NFCC spokeswoman Gail Cunningham said in a statement.

"Financial awareness often provides the motivation to jolt a person into taking action that can change the course of their financial life," Cunningham said.

For those who might be motivated to make some changes, the NFCC has some suggestions that can improve financial awareness.

Here's the list:

  • Face facts. It's impossible to know how you're spending your money if you don't track it. Many people avoid tracking their spending because they're afraid that the reality will force them to make unpleasant changes. But, knowledge puts you in control and allows you to spend mindfully instead of mindlessly.
  • Know how much you owe. "This eye-opening exercise is a must," the NFCC says. Total all your debts, review the interest rates that you're paying, total how much interest you pay each month and consider how you could use that money if you didn't have those debts.
  • Break poor financial habits. "Little money adds up to be big money, so be conscious of incidental spending," the NFCC says. Track how much you spend daily on small items like lottery tickets, vending machine snacks, cigarettes or impulse purchases, which are all budget busters.
  • Determine whether conveniences are worth the price. Eating out or buying prepared food can be more costly than making your own meals. Paying someone to mow your lawn, wash your car, clean your house, prepare your tax returns or do other tasks that you could do yourself also might merit a second look.

Do you know any other tips that could to put you and others on better financial ground?

Follow me on Twitter: @marciegeff.

 

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