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Whether it's waiting last minute to pay bills, routinely over-withdrawing on your checking account, or spending more than you earn, your bad financial habits are likely causing you stress. Have you ever stopped to consider where you picked up these bad habits?

Only 17 states have personal finance education requirements, which means that a lot of our bad financial habits could have come from our parents. How can you unlearn these habits, bring awareness to your own personal set, and rework them into good financial habits?

Bad Financial Habits Commonly Picked up From Parents

While your parents may have spoken to you about the importance of sound money habits — such as saving 10 percent of your paycheck and always paying your bills — you've actually learned much more through their behavior than through their words.

That means that while your parents meant well by telling you how to manage your money, their actual behaviors toward money have made more of an impression on you.

Common bad money habits you might be imitating include:

  • Avoiding making financial decisions
  • Operating without a budget (i.e., "winging it")
  • Only paying the minimum on your credit cards
  • Failing to put savings in an emergency fund
  • Not talking to your partner about money
  • Rolling one car loan into another one
  • Routinely making late payments
  • Using payday loans to stretch your paychecks

While this list is a good start, there are plenty of other bad money habits. Let's look at which ones you could have and how you can start confronting and changing them.

How to Find Your Own Bad Money Habits

In order to recognize your own bad financial habits, start with a mental snapshot of your last month from a financial perspective. Look for areas where your money management felt uneasy, and pay attention to moments of stress. These could include late payments, juggling money between paychecks, being faced with financial decisions, and putting them off (again).

Now, try to find the patterns. You can do this by asking yourself which of these money situations you repeatedly deal with and which of them you've witnessed your parents deal with.

The Steps to Unlearning Bad Financial Habits

Once you've uncovered some of those bad financial habits, the next step is to unlearn them.

Take each habit through the following steps:

  • Write down a list of all the ways this habit affects your life negatively, such as giving you stress, taking time away from your family to deal with repercussions, having to pick up extra work just to make minimum payments, etc.
  • Write down what the opposite of this bad habit looks like — what you're aiming for. For example, if your bad habit includes making late payments, the opposite of that would look like paying your bills with a buffer of time before they're due.
  • Write down what you would need to do to bridge the gap between where you are now, and what you want this habit to look like in the future. If you currently overspend and instead you'd like to stop living above your means, then you first need to stop spending more on credit. Then come up with a debt repayment plan and a budget to avoid overspending in the future.

Unlearning bad habits takes some work. What took you a lifetime to learn will take more than a day or two to unlearn. But if you follow the steps above, not only will you unlearn all of those bad money habits, but you'll become the kind of money role model your kids need to fill their lives with positive financial habits.

Disclosures

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

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