9 Bad Financial Habits to Leave in 2023: How to Improve Your Personal Finances

With the new year approaching, it's the perfect time for us to reevaluate and identify some financial habits that are better left behind in 2023. Follow along as we explore some common habits that we all stumble upon that we can leave in the past to help pave the way for a more financially savvy and successful future.

1. Not Setting Clear Financial Goals: The habit of not setting specific financial goals is something that should be left in the past. In 2024, take the time to define clear financial objectives. Whether it's buying a home, paying off debt, or traveling the world, having goals can help you stay focused and motivated!
2. Neglecting Emergency Savings: It's time to bid farewell to the habit of not having an emergency fund in place. Unexpected expenses are a part of life, and having a financial safety net is crucial. In 2024, make it a priority to build an emergency fund that can cover at least three to six months' worth of living expenses.
3. Ignoring Budgeting: Budgets are like roadmaps for your financial journey; they help you keep track of your income and expenses, allowing you to make informed financial decisions. In 2024, it's time to embrace budgeting as a tool for financial success.
4. Relying Heavily on Credit Cards: Excessive reliance on credit cards can lead to high-interest debt and financial stress. In 2024, strive to use credit cards responsibly and avoid carrying balances. Paying off your credit card balance in full every month is a financially healthy habit to adopt.
5. Overlooking Investment Opportunities: In the past, many have kept their money parked in low-yield savings accounts or neglected to invest altogether. Leaving your money idle means missing out on the potential for growth and accumulating wealth. Heading into the new year, consider exploring investment options that align with your financial goals and risk tolerance. Consider opening a Certificate of Deposit (CD) with PFCU. CDs are a great, low-risk way to help maximize your savings.
6. Failing to Save for Retirement: Saving for retirement is often a habit that gets postponed or ignored. However, the earlier you start, the more time your money has to grow. Make it a priority to contribute to retirement accounts like a 401(k) or an IRA to secure your financial future.
7. Not Tracking Expenses: Failing to track expenses can lead to overspending and poor financial decision-making. In the new year, use tools and apps to monitor your spending habits. Awareness is the first step to making necessary adjustments and achieving your financial goals. PFCU's credit score is a great way to monitor how your financial habits can impact your credit score.
8. Impulse Buying: The habit of impulse buying has derailed many financial plans. In 2024, let's plan to break free from this habit by setting a spending plan and resisting the urge to make impulsive purchases.
9. Avoiding Professional Advice: Some individuals have been reluctant to seek advice from financial professionals. In 2024, consider meeting with a financial counselor at PFCU to ensure that your financial plans are aligned with your goals, and that you're making the best decisions for your future.

By leaving behind these outdated financial habits in 2023, we can embrace a brighter future filled with opportunity, prosperity, and financial well-being. I encourage our members to take these steps, and reach out should you need a helping hand in meeting your personal finance goals!