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10 Bad financial habits to break this year

Old habits die hard, but that doesn’t mean you can’t break them. If you have been stuck making bad financial decisions all this while, it’s time to pull the plug on them and develop better financial habits. Working towards good money habits can set you up for financial success.

You may have been making bad financial decisions unknowingly, or perhaps you have difficulty nipping them in the bud. This article will point out bad spending habits you may have developed over the years and how you can break them.

10 Poor financial habits to break today

1.  Not keeping track of expenses

A rookie financial mistake is not keeping track of where your money goes. Often, this can lead you to exhaust your income or pile on debt. One way to ensure this doesn’t happen is to start making a budget to track your income and expenses.

2.  Paying bills late

No matter what bill you are paying, if you delay in paying it, you will accumulate interest and a fine. Set up automatic payment mechanisms from your bank account to avoid missing due dates.

3.  Shopping unnecessarily

Retail therapy can feel great at the moment, but it is a terrible financial habit. Shopping when you’re in a bad mood or bored can lead to unnecessary spending. If you absolutely want to shop every month, allocate an amount from your budget and don’t exceed that limit

4. Swiping your credit card for everything

Credit card usage is ideal for monthly spending or emergency needs. If you’re in the habit of swiping your credit card for everything, from impulse shopping to dining out, then you can rake up a lot of debt that can be difficult to pay off. Instead, limit your credit card usage only to specific expenses.

Additional read: Eight Financial New Year Resolutions for 2022 (add after publication)

5.  Eating out too much

This is a millennial phenomenon that can be pretty hard to break. Spending a lot of money eating out or ordering food can quickly drain your wallet. Rather than eating out every day, limit your eating out to weekends or order in a couple of times a week. 

6.  Keeping unnecessary subscriptions

From one too many OTT subscriptions to gym memberships you don’t use, these are some poor financial habits that can cost you heavily in the long run. Consider unsubscribing from irrelevant subscriptions if you are not using them. It may help you save a good amount.

7.  Lending without account

While it's wonderful to help a friend or family member out when they're in need, if you give too much money away without accounting for it, it can pinch your budget. Consider lending money to people who are reliable and who will repay you.

8.  Living beyond your means

Young people often fall prey to keeping up appearances and fitting into the status quo. It can cost you considerably if you’re not careful. A fancy dinner you can’t afford or a vacation beyond your means can cause you to bleed money. Instead, try to budget for these things in advance, so you are not taking on debt to keep up with social status.

9.  Skimping on insurance

You may think you’re in the pink of health or that you’re a careful driver and you don’t need insurance. But emergencies strike out of nowhere. You could get in an accident or come down with an illness that can cost you a hefty sum. Having health insurance, motor insurance, and even home insurance can save you money.

10.  Not saving

The most important financial decision to make is saving and investing. If you’re not in the habit of putting aside money for the future, you may find yourself in uncomfortable financial situations. You can remedy this by paying yourself first. Every month, set aside an amount for saving, investing and an emergency fund before spending on other things.


Acknowledging that you have poor financial habits is the first step to making wise financial decisions. Break one habit at a time and see the magic it creates for your finances.

Disclaimer – ICICI Securities Ltd. ( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. The contents herein above shall not be considered as an invitation or persuasion to trade or invest.  I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investments in securities market are subject to market risks, read all the related documents carefully before investing. The contents herein mentioned are solely for informational and educational purpose.

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