Not saving as much as you could? Spending beyond your means? Paying bills late and failing to make a budget? You’re not alone. A survey last week conducted by Allianz Life Insurance asked consumers about their worst financial habits and all of these made the list – plus more.
With the recent buzz about the U.S. government facing an impending “fiscal cliff” if tax and budget issues aren’t resolved in the new year, many Americans are failing to consider their own personal fiscal cliffs – the ones they could be standing on if they don’t change some of their poor financial behavior.
The 2012 Bad Financial Habits Survey, sponsored by the Allianz Life Insurance Company of North America, asked 1,000 people about their worst financial habits and top economic concerns.
Unemployment tops the list
Nearly half of them (44%) listed unemployment as their primary economic concern, and 31% were worried about the government’s fiscal cliff. They also owned up to being guilty of the following bad habits:
- Not saving as much money as they could – 24%
- Not keeping a household budget – 18%
- Spending more than they make – 18%
- Being ignorant about financial planning – 15%
- Not paying bills on time – 12%
- Making only minimum payments on credit cards – 10%
- Gambling or playing the lottery – 9%
- Not seeking professional financial help – 9%
- Not contributing to employer-sponsored retirement plan – 5%
(Multiple responses were allowed).
Nearly a quarter of respondents (24%) didn’t feel that any of those bad habits were problems for them. Of all the bad habits listed, paying credit card minimums could be one of the most financially damaging in the long run.
Most credit cards calculate the minimum payment due as 2% of the total amount owed. Paying the $100 minimum payment due on a debt of $5,000 and continuing to use the card to make new charges can easily result in never paying off debt, even with a relatively low APR. Interest plus new charges will keep the credit card holder in debt indefinitely.