Author: Claire Tsosie

A Late Credit Card Payment May Cost You More in 2019

Posted on by Claire Tsosie

In 2019, $28 might be enough to cover a fancy steak dinner, a haircut, a pile of lottery tickets — or, if you’re not careful, a first-time late fee on your credit card bill.

Starting Jan. 1, 2019, the Consumer Financial Protection Bureau will nudge up the permissible maximums for credit card late fees by $1, potentially making these already steep fees even harder to stomach. Under the new limits, late fees will be capped at:

  • $28 for the first time you’re late. Previously, these were capped at $27.
  • $39 for subsequent violations. Previously, these were capped at $38.

These new thresholds, which the CFPB adjusts annually according to a consumer price index, might not inspire issuers to increase their late fees instantly. But they could herald slightly higher penalty charges in the coming months.

Consider what happened when these caps on subsequent late fees increased from $37 to $38 in 2016: Five major credit card issuers eventually increased late fee caps to match that threshold. As issuers make other tweaks and updates to their portfolios in 2019, the same thing could happen. But with some smart strategies, you can make sure you don’t ever have to pay these fees.

Late fees, explained

If paying a late fee on your credit card bill feels punishing, that’s by design. In part, issuers use these penalties to discourage cardholders from falling behind on their obligations. And they can be applied swiftly, too: Even if you’re just a day past due — surprise! — one might pop up on your account and ruin your day.

The Credit Card Act of 2009, which generally limits late fees, comes with a provision that allows the CFPB to annually adjust caps on permissible late fees in step with a consumer price index. If the consumer price index doesn’t change enough to move the fees up or down by a full dollar, the fees remain the same. But if the index rises or falls enough, it triggers an increase or decrease. This year, it was the former.

These limits on late fees exist, in part, to protect consumers from more onerous late fees. But they also make it a little easier for issuers to comply with the law.

“The federal law says that the [late] fees have to be reasonable and proportional,” says Nessa Feddis, senior vice president for consumer protection and payments at the American Bankers Association. She notes that by law, banks also have the option to determine what’s reasonable and proportional using their own costs and losses. But in practice, they tend to follow the government-established limits because it’s a simpler way to stay in compliance.

As of this writing, none of the major issuers has announced increases to their late fees for 2019. But historically, major issuers have inched up their late fees in line with these caps. To see whether your late fees might be rising, watch for notices from your credit card issuer. Issuers are generally required by law to give you at least 45 days’ notice before making such changes.

To be sure, late fees aren’t the only consequence of paying credit card bills late. In some cases, your issuer might also apply a higher penalty APR — typically about 30% — to new purchases on your account. And if you’re more than 30 days past due, your missed payment could also be reported to the credit bureaus, causing your scores to tumble.

How to prepare

Your credit card late fees might not have changed yet, but they might increase in the coming months. Now’s a good time to do what you can to avoid ever paying these penalties.

Set up autopay. Even with all the calendar reminders in the world, it’s still possible to forget credit card payments. Avoid this fate by setting up your credit card account on autopay, if you feel confident you can do so without overdrawing the bank account it’s linked to.

Find a more forgiving credit card, such as the Citi Simplicity® Card – No Late Fees Ever. Alternatively, consider the Discover it® Cash Back, which waives the late fee on your first late payment. Policies like these might bail you out of a bad situation, especially if you’re worried about forgetting a payment.

Call your issuer if you slip up. Often, issuers waive late fees for customers who typically pay on time. If it’s out of character for you to miss a payment, give your issuer a call and see whether they’ll give you a pass. Then, do what you can to avoid making the same misstep in the future, such as setting up alerts on your account to remind you of future due dates.

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The article A Late Credit Card Payment May Cost You More in 2019 originally appeared on NerdWallet.

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How to Manage Student Loan Debt Without Making It Worse

Posted on by Claire Tsosie

When you’re struggling financially, keeping up with your student loan payments might feel like you’re stuck on a runaway train — and student loan forbearance, which allows you to pause these payments temporarily, might look like a soft landing. But watch out: Although forbearance is undeniably quick and easy to set up, its high costs can leave you hurting.

A new NerdWallet survey, conducted online by The Harris Poll, found that two-thirds of Americans (66%) don’t know that interest continues to accrue at the regular rate when federal student loans are in forbearance. That interest adds up fast: NerdWallet’s analysis shows that if borrowers currently in forbearance kept their balance there for 12 months without making interest payments, they’d add an average of $2,199 in interest charges to their debt, assuming the current 5.05% fixed interest rate for direct subsidized and unsubsidized loans for undergraduates and a balance of $43,538. (Among student loan recipients with federally managed student loans in forbearance during the third quarter of 2018, borrowers carried this amount in forbearance on average.) At the end of the forbearance period, those interest charges could drive up monthly payments, making a bad situation worse.

Forbearance might seem like an appealing option because it’s simple to set up; putting loans into general forbearance can be done with just a phone call. In some cases, schools even recommend it to borrowers who are falling behind on payments. But often, it’s not your best option. Here’s what you can do instead.

Consider deferment for subsidized loans

Forbearance has a lot in common with deferment: Both allow you to hit the brakes on student loan payments for a time. The main difference: Subsidized loans and Perkins loans don’t accrue interest in deferment. (Unsubsidized loans do.)

For subsidized loans, or federal loans awarded based on financial need, “I would definitely recommend exhausting any deferment periods first,” says Colleen Campbell, associate director of postsecondary education at the Center for American Progress, a public policy research organization. You’ll need to meet eligibility requirements to get a deferment, though; that’s not the case with forbearance, which you can often get for almost any reason.

Typically, you’ll have to file paperwork with your loan servicer to show you’re eligible for deferment. But that shouldn’t deter you from applying.

Another benefit: If you qualify for deferment, you can keep that more flexible forbearance option in your back pocket, in case you’re ever in a more pressing financial bind and need quick relief.

Low income? Try an income-driven repayment plan

For borrowers who aren’t making enough money to cover student loan payments, setting up an income-driven repayment plan could be a smart move. Consider the Revised Pay As You Earn plan, or REPAYE, which doesn’t come with any income requirements. With this plan, which requires you to recertify your income and family size each year:

  • Your required payment will generally be 10% of your discretionary income.
  • After you make payments for 20 or 25 years, your loan balance is forgiven.
  • If your payments aren’t large enough to cover your interest costs, all or part of the interest that accrues during that time will be paid for by the government.

Eligible borrowers with no income, or very low income, won’t have to make payments at all under REPAYE. But unlike with forbearance, they won’t have to pay the full amount of interest that accrues while in this plan, and after 20 or 25 years of payments, their remaining balance will be forgiven (although they may have to pay income tax on the forgiven balance). For borrowers who can afford to pay more, those payments can help chip away at that debt.

“You don’t know what the future holds,” says Betsy Mayotte, president and founder of The Institute of Student Loan Advisors, a nonprofit organization that offers free expert advice on student loans to consumers. “If you use an [income-driven repayment plan] instead of forbearance, and let’s say things don’t improve the next year or the year after, you’re at least progressing toward loan forgiveness with the income-driven repayment plan.”

Both Mayotte and Campbell recommend using the Department of Education’s online Repayment Estimator to compare the costs of different repayment options.

If you have private student loans, income-driven repayment plans aren’t an option for you. However, you might be able to contact your lender and modify your payments.

When forbearance makes sense

Think about student loan forbearance like a fire extinguisher: In an emergency, it can be a helpful tool. But it’s not meant to be used all the time.

“Forbearance is almost always a last resort,” Mayotte says. She adds that when borrowers simply can’t afford their payments on their income, forbearance certainly won’t help; in fact, payments can get larger after forbearance when unpaid interest is added to the balance.

Consider breaking the glass on that forbearance option if you’re temporarily dealing with very high expenses, such as a large medical bill or an unavoidable, urgent home repair. You’ll still be responsible for the interest that accrues, but if taking a short break from payments helps you get on more stable financial footing, the cost might be worthwhile. Just try to avoid using this option for more than a few months, if you can help it. A different repayment option could save you thousands in the long run, even if it requires more paperwork upfront.

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The article How to Manage Student Loan Debt Without Making It Worse originally appeared on NerdWallet.

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How to See the World in Your 20s Without Racking Up Debt

Posted on by Claire Tsosie

It’s a dilemma many 20-somethings face: You badly want to travel the world. But if your bank account could talk, it would say, “Are you kidding?”

When you’re just starting out, even a weeklong vacation might seem like a one-way ticket to credit card debt — especially if you have a modest income or lack access to paid time off. But with the right moves, you can budget for travel without going into the red.

Start saving

For Krista Aoki, the key to avoiding debt while traveling is simple: Save.

Before a big trip, “I try to always start with a big cushion. I always save up beforehand, and I try to save up more than I need to,” says Aoki, 26, an online business manager who does consulting and virtual assistant services for other online businesses. She estimates it takes her about three months to save up for a big trip. She now travels full time and is currently in Kealakekua, Hawaii.

To save for travel, she spends less on other items, such as clothes. She also hasn’t owned a car in 2½ years and often relies on public transportation.

You might not be able to pay for a vacation in full right this second. But that doesn’t mean you need to choose between taking on credit card debt or being a hardcore homebody. By spending less in certain areas now and setting aside money consistently, you might have enough to cover a small getaway in a few months.

Decide where to minimize costs

The best vacation isn’t necessarily the most expensive vacation. By aggressively reducing your basic costs — flights, transportation, lodging, food — you might be able to squeeze in more exploring for a smaller price.

Instead of booking hotels, for example, you might opt to stay at hostels, which are more like college dorm rooms. Often, staying in a hostel means sharing a room and bathroom with others and sleeping in bunk beds rather than on queen-size mattresses. But they’re a good way to meet other travelers and can be startlingly cheap.

“A nice co-working hostel in Chiang Mai in Thailand is like $10 a day,” says Aoki, who says she spends most of her time in Thailand. “I’ve been to two, and they’re really clean and pretty comfortable, and they include breakfast and a working office.” If you’re willing to sacrifice some privacy, staying at one might make it easier to pay your credit card bill in full when you return from your trip.

Use credit card rewards

When Leah Gervais was 24, she traveled in Southeast Asia for four months without going into debt, in part by using credit card rewards to pay for her flights.

“It’s not that I had a lot of savings ready to go,” says Gervais, now 26, founder of lifestyle website Urban 20 Something. “What I did have was a lot of frequent flyer miles.” She got the miles in college by earning sign-up bonuses on airline credit cards; she didn’t carry balances on them. With those miles, she was able to fly from New York City to Siem Reap, Cambodia, and back to New York City from Bangkok for just the cost of taxes and fees. (She paid cash for other shorter flights she took throughout Southeast Asia, which were quite affordable, she says.)

If you’ve been using a rewards credit card, log on to your online portal to tally your miles or points. It might be enough to cover part of your trip.

Make money while traveling

Both Aoki and Gervais have something in common: They work while they travel. That gives them flexibility to visit more places and stay on the road longer.

“I started doing some freelance writing work while I was [in Southeast Asia],” Gervais says of her four-month trip, noting that the cost of living in Cambodia was significantly lower than it is in Manhattan, where she lives. On that trip, she also worked as a bartender for a short time. Because she was traveling frugally, her income from these jobs was enough to support her abroad.

If traveling is a priority, look for jobs that can be done remotely, such as freelance graphic design or writing. Or consider jobs that require you to take business trips. Working while traveling isn’t exactly “vacation,” but it’s a financially sustainable way to satisfy your wanderlust. While you’re exploring, you can make sure money’s flowing into your bank account faster than it’s flowing out.

This article was written by NerdWallet and was originally published by The Associated Press. 

The article How to See the World in Your 20s Without Racking Up Debt originally appeared on NerdWallet.

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What Really Matters With Your First Credit Card

Posted on by Claire Tsosie

Getting your first credit card is like moving into your first apartment: It’s exciting, empowering — and, once you get used to it, pretty underwhelming.

Your first time out, “you’re not going to have a credit card that is going to have a high limit,” says Paul Golden, spokesman for the National Endowment for Financial Education. “It’s not going to have great benefits or kickbacks or reward programs probably tied to it. And that’s OK.”

A starter credit card is just that — a start. Used responsibly, it’s a way to build a positive credit history, which will help you with things like getting a better deal on a mortgage or cheaper car insurance; and it will help you qualify for a card with better terms down the road — for example, one with richer rewards. Here’s what you should look for.

Ease of approval

When you have a thin credit file and limited income, you’re not likely to qualify for a card packed with benefits. Instead, aim for something more basic.

If you already have a credit history that shows consistent on-time payments and responsible borrowing — say, from repaying student loans — it’s possible to qualify for a regular “unsecured” credit card that doesn’t require a deposit. To increase your odds of approval, apply through the bank you already use or with a preapproved offer received in the mail. If you’re in college, look into a student credit card.

Don’t have a credit history yet? Consider applying for a secured card, one that requires a cash deposit. Or ask a parent to add you as an authorized user on a card with a history of on-time payments and a balance that’s far below the limit.

No annual fees

Avoiding an annual fee on your first credit card is a budget-friendly move that allows you to keep the card open for a long time at no cost. That can bolster your credit scores if you continue to make on-time payments on the account.

Useful rewards

When Zina Kumok applied for her first credit card at 22, she wanted a sign-up bonus — one that she could earn easily.

“I wasn’t making a lot, and I was trying not to spend a lot” at the time, says Kumok, now 29, a freelance writer in Indianapolis who covers personal finance.

“I didn’t want to feel like I was being pressured to spend more to reach a bonus, which obviously never works out in your favor,” she says. Kumok opted for a card with versatile cash-back rewards and a sign-up bonus with a modest spending requirement.

Follow Kumok’s lead: Look for a card that will reward you for the spending you’re already doing to avoid overspending to land a sign-up bonus.

Keep in mind that cards with rewards tend to charge higher interest rates. But if you expect to pay your bill in full every month, that shouldn’t be a deal-breaker.

“The APR only matters if you don’t pay off your balance,” Kumok says.

Reporting to all three bureaus

Your first credit card has a simple purpose: to demonstrate to lenders that you can handle credit responsibly so you can borrow money when you need it later on.

Make sure the card reports to all three of the major credit bureaus: Experian, Equifax and TransUnion. Most credit cards do, but if you’re unsure, contact the issuer.

How to manage your first card

Applying for your first credit card is simple, but building a credit history takes more effort.

  • Stay well below your limit. Using too much of your first card’s tiny limit could sink your score. But you don’t have to spend a lot to kickstart your credit history. It’s possible to build credit by making just one small transaction per billing cycle and paying it off on time. “You could set up your recurring monthly cell phone bill to be paid [with] your credit card,” Golden says.
  • Pay your balance in full and on time every month. Do this and you won’t pay a penny in interest or penalties, and you’ll build a positive credit history, too.
  • Make a plan. To avoid overspending on your new credit card, set a weekly budget and keep tabs on your accounts. If your spending starts to creep up, trim costs to get back on track.

This article was written by NerdWallet and was originally published by The Associated Press. 

The article What Really Matters With Your First Credit Card originally appeared on NerdWallet.

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New Grads, Unlock Your Future With a Credit Check-Up

Posted on by Claire Tsosie

In college, establishing credit felt about as pressing as an optional homework assignment. But now that you’ve graduated, it’s suddenly at the top of your summer to-do list, with a deadline of ASAP. And for good reason.

Good credit is your ticket to an easier and more affordable postgrad life. It could help you qualify for apartments, nab low-interest car loans, pay less for car insurance, set up utilities with little or no deposits, and more. And it’s not that hard to get started. With a few strategic moves this summer, you can make sure future-you is ready to clinch those savings.

See where you stand

If credit hasn’t been on your radar until now, you might not know whether you have it or not. So here’s where to start:

  • Check your credit reports. The federally authorized site AnnualCreditReport.com offers free credit reports from each of the three major bureaus — Experian, Equifax and TransUnion — every 12 months. These list your credit accounts and payment histories, among other information.
  • Check your credit scores. Typically ranging from 300 to 850, these numbers give you a bird’s-eye view of your credit. The most commonly used ones are generated by credit-scoring companies FICO and VantageScore. You can access these for free through certain credit card issuers and third-party sites.

Once you do this, you might discover that you actually do have credit — and good credit, at that.

Such was the case for Jennifer Jackson of Atlanta, now 27, who got her first credit card in college. Her dad also added her as an authorized user to a card with a positive credit history.

In school, “I didn’t know that I was building credit,” says Jackson, who founded the blog ADLT101.com. “I wasn’t doing it on purpose. But it ended up helping me.”

After graduating, that good credit helped her get a low-interest auto loan, which saved her plenty, she says. Now, as a millennial transition coach, she speaks to students in colleges and universities about how to prepare for postgrad life.

No credit? Get started

When you’re starting fresh — no student loans, credit cards or other credit — your to-do list is straightforward: Get an account that reports payments to the three major credit bureaus.

“You only need one credit account to have a good score,” says Barry Paperno, a credit expert and blogger at Speaking of Credit. “That’s all you need. I don’t want people to think the bar is so high for getting a score, or a good score.”

After six months of reporting from that account, you’ll have enough credit history to generate a FICO credit score, he notes. You’ll be able to get a VantageScore credit score even sooner.

Here’s how you can get going:

  • Get a credit card: If you have no credit, you might have to start with a secured card, which means putting down a refundable deposit — usually around $200. You might also qualify for an unsecured card with your bank or a store-branded card.
  • Take out a credit-builder loan: With these loans, the money you borrow is typically held in a bank account while you repay the loan in installments. Afterward, the money is released to you.
  • Become an authorized user: Jackson’s dad added her as an authorized user on one of his cards while she was still in school. “I had a really old car in college. He said, ‘OK, I’m going to put your name on this card so you can use it if you need to go get some repairs done on your car.’” Because he had managed that card well, it lifted her score, she says.

Already have credit? Cultivate good habits

Finding out you’ve built a solid credit history without trying can feel like passing a test you didn’t study for: It’s a relief, and a little exhilarating. But resist the urge to mentally check out. To keep that score in good shape, you need to continue building a positive payment history, which means keeping your balances low and paying loans, credit cards and other accounts on time. Be aware you can do this on a credit card without carrying debt from month to month.

“There’s nothing to be gained by running a balance,” Paperno says. “There’s plenty to lose, particularly the high interest you’re going to pay.”

By paying in full and on time, you’ll avoid interest charges and penalties — and keep your score healthy.

Claire Tsosie is a writer at NerdWallet. Email: claire@nerdwallet.com. Twitter: @ideclaire7.

The article New Grads, Unlock Your Future With a Credit Check-Up originally appeared on NerdWallet.

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When Renting Your First Place, Good Credit Can Open Doors

Posted on by Claire Tsosie

When first-time renter Angelica Fattu-Logan, 20, started applying for apartments, she braced for rejection. But those rejections never came — in part because she had good credit.

“I applied to about three or four different apartments, and they all accepted me right away,” says Fattu-Logan, a drugstore manager and college student from Peoria, Arizona, who recently moved into an apartment with her fiancee. “It was a pretty quick process, like two days. It was just a matter of picking which one I liked better.” She maintains her credit by paying for groceries with her credit card and paying off the balance right away.

For young folks fearing rejection from landlords, Fattu-Logan’s positive experience is heartening. It also illustrates an important point: Good credit can be especially helpful for first-time renters.

Better chances of approval

When you’re new to renting, good credit can make up for other shortcomings in an application.

“If [applicants] have a good credit score, even if they haven’t rented before, that means that they’ve handled their finances well and that they’re responsible,” says Laura Agadoni, a landlord and real estate writer based in Marietta, Georgia. That could be enough to make up for a lack of a rental history, otherwise a major factor in rental decisions, she says.

“My bottom line is, I just want to get my rent on time,” she says.

Requirements can vary, but Agadoni says many landlords look for credit scores of 640 or higher for renters. They also consider factors such as income, debt and employment.

In some cases, those with good credit scores might not need to find a co-signer, a person — often a parent — who’s equally responsible for making payments. But Agadoni notes that she might still require a first-time renter with good credit to get a co-signer if they’ve worked at their job for less than a year and have limited savings, for example.

“Every situation is different,” she says.

Savings on rent and deposits

If you’re approved with good credit and meet all the landlord’s requirements, you’ll generally just have to pay the security deposit and rent described in the rental listing. But if you’re approved with bad credit, you may have to pay a premium — not just on rent, but potentially for utilities, too.

“We’ve definitely seen consumers with more challenged credit having to put higher deposits down in order to rent a property,” says Jim Triggs, senior vice president of counseling at Money Management International, a nonprofit credit counseling agency.  The firm offers counseling to renters, among other services. He adds that landlords sometimes also charge higher rents to these applicants.

Many utility companies — such as electricity and gas providers — also charge upfront deposits to those with poor credit.

“Normally, the better your credit, the better arrangements you’ll have with any of those utility companies, up to and including zero deposits,” Triggs says.

More bargaining power

In cities where the rental market is extremely competitive — say, San Francisco or New York — having good credit is just table stakes. But in areas where landlords have trouble finding tenants, a good score can give you bargaining power.

That’s because good credit is a crystal ball that tells landlords you’re reliable. “How you pay your bills is predictive of how you’re going to pay your bills in the future,” says credit expert John Ulzheimer. “That includes rent.”

If a landlord is eager to find a renter and you have good credit, “the apartment [landlord] is absolutely going to want you to move in, and move in lickety-split, because they’re going to want to start getting paid,” Ulzheimer says. “And you can lean on them a little bit.”

For example, he says, you may be able to negotiate a good parking spot or extra garage remote controls, even as a first-time renter.

Before renting, check your credit

Before you go apartment-hunting, check your credit reports and credit scores to see where you stand.

Doing so is free and doesn’t hurt your scores. If you have good credit, you can walk into property viewings with confidence, knowing you’re set up for success. If you have bad or no credit, you can focus on making improvements. Be upfront with landlords about what steps you’re taking to work on your credit and, in the meantime, budget for a larger security deposit. It may take longer to find a space that’s right for you, but with persistence — and maybe some help from a co-signer — you’ll get there.

The article When Renting Your First Place, Good Credit Can Open Doors originally appeared on NerdWallet.

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You Could Be Overspending With Credit Cards. Yes, You.

Posted on by Claire Tsosie

When it comes to credit cards, you might think of yourself as a low-key rock star: You always pay on time and in full and maintain excellent credit. Compared with others, you’ve mastered the basics. And yet you — yes, you — might be using credit cards to spend too much.

Don’t let your good credit card habits lull you into complacency.

“It’s kind of like going to the doctor and having your cholesterol tested and seeing that it’s normal … and then saying, ‘Hey, I’m in great health!’” says Brad Klontz, a certified financial planner and associate professor of financial psychology at Creighton University in Omaha, Nebraska. “Financial health has many elements.”

Here are some signs that your credit card balances are becoming bloated and ways to rein in your spending.

You’re falling behind on savings goals

When you’re overspending, your savings goals — such as an emergency fund with three to six months’ worth of basic living expenses or a retirement fund — are often the first to suffer. Neglecting them long term could put you in a precarious financial position.

“You just want to make sure you’re first putting money aside or paying for things that matter the most to you,” Klontz says.

You’re buying out of boredom

When you’re bored, hitting the mall or browsing online stores regularly can be hard to resist — but it can also get expensive.

In 2010, Ruth Soukup had just moved to Punta Gorda, Florida, with her husband and two children. They had saved and budgeted to redecorate their house, but afterward,  Soukup found it hard to return to her usual spending habits.

“I kind of got into this mode of spending, spending, spending,” says Soukup, who now sticks to a budget. She’s the author of “Living Well Spending Less” and runs a lifestyle and personal finance blog by the same name. “My husband was going to work, and I was kind of bored being a stay-at-home mom. That was kind of my excuse to go to Target, or wherever, and just kind of wander around the stores.

“I was overspending, even though I wasn’t spending more money than we had,” she says.

You’re breaking your own spending rules

Chances are, you have some personal spending rules when shopping, even if you don’t maintain a strict budget. One might be, “I’m not going to spend more than $50 on a pair of jeans.” Or, “I’m only here to buy a new vacuum cleaner. I’m not going to buy anything else.”

And if you break those self-imposed rules? “There’s almost … this twinge you get in your stomach, where you kind of know you shouldn’t be spending [that money],” Soukup says.

A one-time splurge generally won’t derail your savings goals. But splurging again and again can throw them off track — or land you in credit card debt.

How to break the cycle

If you’re stuck in a cycle of overspending, here’s how to find your way out.

Build a better budget. A complicated budget isn’t necessarily more effective. A weekly credit card spending limit can be enough to control your cash flow. If you want to get fancy, create a 50/30/20 budget, where 50% of your take-home pay goes to needs, 30% goes to wants and 20% goes to saving or paying off debt.

Read your credit card statements. “Look over these last three months and see if you can find a pattern to this overspending,” Klontz says. Then he recommends making purchases with cash or a debit card. That makes the financial impact more immediate.

Try a temporary spending freeze. If you need to reset your shopping habits, swear off spending on nonessential items for a time — even just a week. These days, Soukup and her husband implement regular, monthlong spending freezes. “We’d mostly eat from our freezer and pantry when possible, only buy the bare minimum of groceries, no other extraneous things,” Soukup says.

Replace your old habits with new ones. Instead of getting takeout regularly, make cooking part of your evening routine. Next time your friends want to go to the movies, invite them over for a potluck and stream a show at your place. By replacing your spending habits with saving habits, you’ll reach your big-picture financial goals sooner.

 

This article was written by NerdWallet and was originally published by Forbes.

The article You Could Be Overspending With Credit Cards. Yes, You. originally appeared on NerdWallet.

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