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5 Bad Financial Habits That Can Lead to Bad Credit



This article is published in collaboration with Scutify, where you can find real-time markets and stock commentary from Robert Marcin, Cody Willard and others. Download the Scutify iOS App, the Scutify Android App or visit

There are numerous spending habits which can lead you into debt. Some creditors lure you into spending more than you have by promising low-interest rates others offer minimum payment options. If you are guilty of having bad credit and want to fix it, then you need to fix the habits which cause it. Here are four bad credit habits to fix today!

Making Minimum Payments

A lot of people choose to make minimum payments on their credit cards, but it does not mean you are getting out of debt. Minimum payments are usually calculated to be about 5% of your outstanding balance which means you are staying in debt for longer because of the accruing interest adding on each month. Next time you check your bank statement, remember that you owe the balance not the minimum payment.

No Emergency Fund

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Every household, in fact, every individual should always have an emergency fund. You should always keep some savings hidden away as a backup plan in case there is an emergency. If however you cannot access your savings or don't have enough money than using cash advance online is also an option. But it's best to avoid borrowing money against collateral.

Spending More Than You Earn

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Just because your friend or neighbor got a new car does not mean that you have to change yours too. Healthy financial habits include spending within your means. You may be tempted to spend your job bonus to take a vacation or buy a new house, but it could land you into huge debts. How much you earn isn't the only factor when it comes to staying out of debt, it's how you manage your money.

Having a fancier lifestyle is a natural part of earning more and moving up the career ladder-but it's only acceptable if you are spending within your means. As soon as you start going into debt to afford a certain lifestyle, everything becomes problematic.

Impulse Buying

It is easy to lose track of your budget in your daily routine as many of us are guilty of impulse buying. Because impulse buying is unplanned sometimes, you may not have the funds to cover the costs. By justifying that you have a genuine need for an expensive pair of shoes or a handbag, you are allowing yourself to overspend. This habit can seriously derail your financial goals.


The solution to all these bad financial habits is, first of all, to recognize that you have a problem. Unless you realize your spending behavior needs to change-you will find yourself sabotaging your financial stability. You can either get help from a professional or make a financial plan for yourself which describes your pathway to become debt free.Understanding that you are ultimately responsible for hurting your chances of financial stability just might be the kick you need to get yourself out of debt.

This article was written by Anne Straker for on .

This article published in collaboration with Scutify, the best app for traders and investors. Download the Scutify iOS App, the Scutify Android App or visit

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