When your bank statement comes in the mail or you get it online, do you pay attention to it? I don’t think that most people do. I think most people toss it in the shredder or circular file and move on with the rest of the mail. But I think the only way you can be honest with yourself about what you have been doing with your money is to dig out your last three (3) statements and take a look.
First, look at your deposits vs your withdrawals. Hopefully you have more coming in each month than you do going out. This is probably one of the biggest red flags of not managing your money well. Money is a finance resource. We can only spend (or we only should spend) the amount that we have at any given time.
Second, what are you spending your money on? This is HUGE. Do you have 25 debit card transactions in one day and 14 of them are for food? Add up how much you are spending on both eating out and entertainment (since they are really both just entertainment). Does your bank statement generally resemble what your statement would look like if your 10-year old got ahold of your debit card and ran amuck? I’m talking about McDonalds, Red Robin, GameStop, Toys R Us, Papa John’s Pizza, etc? If so you probably need to re-evaluate your eating habits in addition to what you are doing with your money.
Third, does your account show fees? Do you have a bunch of overdrafts each month? Those are the worst. You are spending money on less than nothing. Get it together and figure out how to stop overdrafts. If you have a continual problem with overdraft fees consider closing out your account and operating with cash/money orders. Or, consider changing over to a savings account and just taking cash out to pay for your needs. Don’t attach a debit card to the account and that should make overdraft fees next to impossible.
Fourth, what recurring charges do you have that you no longer need. Is there a gym membership there that you haven’t used in 2 years? How about a newspaper subscription that you never read? What are you waiting for? Cancel it. And, in the future try not to set up automatic debits to your checking account. Automatic debits simply make it too easy for another person to get your money. Mistakes happen with auto debits and you will be out of the money until they get fixed, assuming that you can fix them.
Finally, how many bank statements are you getting each month? Do you have 7 checking accounts and 2 savings accounts at 4 different banking institutions? My experience is that the more bank accounts that people have, the less money they typically have in those bank accounts. Most people need a savings account and a checking account. Perhaps a Christmas account might be a good idea as well so that your holiday gift giving doesn’t sneak up on you. However, I think any more accounts than that are simply distracting you from how much money you do or do not have in them. The only time I think it is necessary to have more accounts than this is if you have more than $250,000.00 (the amount insured by the FDIC). And I’m fairly certain that if you do have that much money you aren’t reading this blog.
So, instead of tossing your next bank statement(s) the next time they come in the mail take a look. You might learn something about yourself.
Halcomb Singler, LLP, is a debt relief agency. It helps people file for bankruptcy under the bankruptcy code. No attorney-client relationship with the firm of Halcomb Singler, LLP, is created through this blog. Also, please note that Erika Singler is an attorney licensed in Indiana and does not seek to practice law in any jurisdiction in which they are not properly authorized to do so. The information contained in this blog is general in nature and should not be relied upon for the circumstances of any individual(s) or businesses.