Improve your finances in the new year by eliminating these self-defeating money habits.

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Do you resolve every to finally get your finances in order every new year, sock away a respectable amount in savings, and practice better money management, only to fall away from your resolutions and end that year in the same old sinking boat?

If so, it’s time to make 2023 the year you learn to manage money better so you can get ahead of high credit card debt, stop running out of money between paychecks, and finally save enough to pay for vacations so you don’t have to charge them on a credit card.

Ready to replace self-defeating money habits with new practices that can help you finally get ahead? Do you want to begin saving for milestone goals like going to college, getting married, starting a family, or buying a home?

Read on for seven bad money habits to kick to the curb in 2023.

1. Postponing creating a monthly budget

If you don’t have a budget showing your total monthly income and all expenses, you won’t get far. Create a budget using online templates or download a free budgeting app such as Mint, which can guide you on the process, track spending and even send notifications for upcoming payment dates.

2. Paying for everything with credit cards

When you’re struggling financially, it’s almost a given that you must charge many purchases, from gas to groceries to a credit card. While it makes sense to pay monthly bills online with your credit card, set aside enough cash from each paycheck in labeled envelopes to cover groceries, going out to eat, and other daily expenses where you can pay in cash.

This way, you’ll pay closer attention to how much you’re spending, especially as you watch your allocated cash dwindle a bit with each purchase.

3. Making only the minimum credit card payment

You may think you’re freeing up money each month by paying only the minimum payment due on your credit cards. But you’re only extending your debt misery, often by several years, when you make only minimum payments. You could end up paying hundreds of dollars in interest.

To pay off credit card debt faster, always pay more than the minimum payment each month. Meanwhile, stop charging purchases on your credit card unless you can pay off the monthly statement balance each month.

Find out: How to Escape the Credit Card Minimum Payment Trap

4. Putting off opening an emergency savings account

If don’t have emergency savings, you’ll have to charge unexpected expenses to a credit card. Stop putting off opening an emergency savings account. You can probably open a bank account with as little as a $25, $50, or $100 initial deposit. Then allocate an amount in your budget to deposit for emergency savings and stick to it.

To make saving as painless as possible, ask your employer to deposit a set amount from each paycheck to your savings account. That way, you’ll barely notice and won’t be tempted to let your saving goals slide.

5. Not taking advantage of your employer’s 401(K) match

If your employee benefits package includes a 401(K) account to save for retirement, sign up as soon as possible, especially if your employer matches up to a certain percentage of what you contribute from each paycheck. That’s free money, so don’t pass it up.

Find out: How to Get the Most Out of Your 401(k)

6. Racking up ATM and cash advance fees

Hitting up the closest ATM for a withdrawal or credit card cash advance may be convenient, but if you do so often, you’re racking up the ATM bank’s fee of a few dollars or more in addition to your own bank’s fee.

And every time you take out a credit card cash advance, you’ll usually pay a cash advance fee and higher interest than the card’s usual rate, which begins to accrue immediately without a grace period.

7. Ignoring your credit report

To stay on top of your credit score and how to raise it, you need to monitor your credit report at least every few months. You can order a free copy as often as once a week at AnnualCreditReport.com through December 31, 2023.

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC