Many of us have worked hard to form our money saving habits. Others are still trying to get there. Either way, most of us believe that money saving habits are good things for our personal finances. But this isn’t always the case. Sometimes the money saving habits we’ve learned or picked up can actually end up hurting us. Here are a few examples of the good, the bad, and the ugly when it comes to the techniques we may employ to help us save money.
CARRYING CASH INSTEAD OF CREDIT CARDS
You may think you’re doing a good thing by carrying cash rather than credit cards in an effort to help you reduce your spending. This may not always be the case however.
The Good: You end up reducing expenditures since you have to dole out actual cash for your purchases — and that could be painful!
The Bad: You spend all the cash you are carrying with you because it’s burning a hole in your pocket, thereby not cutting costs at all.
The Ugly: Someone steals your wallet or purse or you lose your cash through carelessness and have no recourse other than sucking up your losses and learning not to carry so much cash with you next time.
PUTTING MONEY IN THE BANK
How could you go wrong when putting your money in the bank? You’re being a good little saver aren’t you? Well, it’s possible that there are still downsides to giving your money to the bank whether it is in the form of a savings account, checking account, certificate of deposit or similar savings vehicle.
The Good: Your money is safe, protected by the FDIC, and you may be earning interest on it in the meantime.
The Bad: You’re probably not earning very much interest if anything at all, meanwhile; the bank could be lending your money out to others, reaping rewards to the tune of as much as several hundred percent or more above what you are getting in interest.
The Ugly: The bank controls your money and sets the rules. It can determine the interest rates, change the terms of accounts, and charge you ridiculously high fees if you don’t comply with their rules, all the while making money off of your money.
It might seem impossible that there could be a down side to using coupons. I mean, come on, they’re like money in your pocket, right? Yes they are, and like money, they can be poorly utilized.
The Good: You use your coupons to save money on products you would normally purchase anyway.
The Bad: You misuse or misinterpret your coupons. Don’t you hate when you spend all that time to go to the store, stand in line, and finally get to the cash register only to learn you’ve misread your coupon terms or expiration date and it’s no good?
The Ugly: You use coupons to buy things you shouldn’t. Using coupons to purchase items you don’t need, won’t use, wouldn’t buy otherwise, or are more expensive than comparable items can be a huge savings faux pas.
DISCOUNT SHOPPING ONLINE
Discount shopping can offer a slew of advantages that were not available to shoppers only a decade ago. But you must be wary of how you make use of this shopping option.
The Good: You save money by way of utilizing promotions, comparison shopping, and discounts. You also save time, gas money, and wear and tear on your vehicle by not having to venture out to the store.
The Bad: You end up buying more than you would otherwise because it’s quick, easy, and there are just SO MANY DEALS!
The Ugly: Your personal or financial information is compromised resulting in junk emails, spam, or worse yet — identity theft!
More From This Contributor:
How I Fight Inflation
5 Ways to Save 5 Bucks in 5 Minutes or Less
The Best Financial Decisions I Ever Made
The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute legal or financial advice. For financial advice, readers should consult a licensed financial advisor. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.