Alt=“a magnifying glass enlarging two $20 American bills amongst out-of-focus clutter”
Almost everyone has at least one blind spot when it comes to money. Whether you’re genuinely unaware of these blind spots or actively ignoring them, they usually represent areas ofoverspending or poor money management that sabotages your goal to save more money.
From bad credit to too many subscription services, here are three common culprits.
Blind Spot #1: Living with Bad Credit
A low credit score is often in your blind spot. It’s not like youneed to check this three-digit number every day. It only rears its ugly head when you need to borrow money.
Some banks and online direct lenders aren’t willing to lend money to anyone with bad credit. With a rejection imminent, you might turn to payday loans as an alternative.
Direct payday lenders still consider your credit score before lending you money, but they adjust their loan sizes, rates, and terms to reflect how low your score is. They often extend high-cost loans that are due back in two weeks, or your next payday.
This can be a challenging turnaround time to hit, especially if you’re living paycheck to paycheck. That’s why responsible online direct lenders recommend you stop using payday loans unless you know for certain you can pay what you owe on time.
If you need a little more time to pay off a high-cost cash advance, you can research installment loans for bad credit. Online installment loans are due back over multiple payments spread out over multiple weeks or months, giving you more time to collect the money.
Otherwise, focus on what you can do to bring up your credit score. Eliminating this blind spot can save you a lot of money the next time you need to borrow.
Blind Spot #2: Living without an Emergency Fund
The chances you’ll have to borrow skyrocket when you live without an emergency fund — regardless of your credit score. Anyone can run into trouble if they don’t have the savings to handle an urgent yet unexpected expense.
An emergency fund is fundamental. If you have enough short-term savings, you can handle an emergency even if you don’t have any extra wiggle room in your budget.
So how much is enough? The experts recommend aiming to save $1,000 if you’re starting from scratch. From there, you should save three to six months’ worth of expenses eventually.
Blind Spot #3: Streaming Services
If you’re like most people nowadays, you don’t have cable. Instead, you have a lush ecosystem of streaming services set up on your smart TV and phone. With a click of a button (or tap of a screen), you can flit between all the major streaming platforms like Prime, HBO Max, Netflix, Hulu, Disney+, and Apple TV+.
Having this many memberships mean you’ll rarely hit a paywall, so you can watch all the latest shows. But at roughly $10–20 a pop, these memberships add up to take a big bite out of your budget.
Next thing you know, you’re paying more than you were for cable in the first place. According to one report, the average person spends $273 on subscription services.
Try trimming your subscription list down to the bare essentials. These savings you unearth here can go towards your emergency fund or an installment loan payment.
What Are Your Blind Spots?
Do you fall into any of the traps mentioned above? Blind spots can be as unique as your budget, so put your spending plan under the microscope. With time and dedication, you can catch the areas of your spending you need to tweak.