Things to Stop Doing With Your Money in 2025
Smart Money Happy Hour with Rachel Cruze and George Kamel
Deep Dive
What is one bad money habit Rachel and George suggest leaving behind in 2025?
Using your credit card as an emergency fund. Credit card companies charge high interest rates, and relying on them for emergencies creates a cycle of debt. Instead, build a starter emergency fund of $1,000 and eventually aim for three to six months of expenses.
Why is it important to stop buying things just because they are on sale?
Buying items solely because they are on sale can lead to unnecessary spending. Even if something is discounted, it’s not a good deal if you don’t need it. This habit can result in financial strain and clutter, especially during sales events or holidays.
What is the danger of letting FOMO control financial decisions?
Letting FOMO (fear of missing out) dictate spending can lead to impulsive decisions, such as going into debt for social events or overspending in group settings. It’s important to set financial boundaries and stick to a budget to avoid compromising long-term financial goals.
What is the significance of building an emergency fund?
An emergency fund acts as a financial safety net, preventing the need to rely on credit cards during unexpected expenses. Starting with $1,000 can cover minor emergencies, while a fully funded emergency fund of three to six months of expenses provides greater security and reduces financial stress.
What is the problem with justifying small, frequent treats?
Small treats, like coffee or snacks, may seem insignificant, but they add up over time and can derail financial goals. While occasional treats are fine, frequent, unplanned spending can lead to financial strain and make it harder to achieve long-term objectives.
Why is it harmful to compare yourself to others on social media?
Comparing yourself to others on social media can lead to feelings of inadequacy and impulsive spending to keep up with perceived lifestyles. This habit can distract from personal financial goals and create unnecessary pressure to spend beyond your means.
What is the issue with paying for subscriptions you rarely use?
Paying for unused subscriptions wastes money and can go unnoticed for months or even years. Regularly reviewing and canceling unused subscriptions can free up funds for more meaningful financial goals or savings.
What is the impact of procrastinating financial goals?
Procrastinating financial goals, such as saving or investing, delays progress and can lead to missed opportunities for growth. Starting early and consistently working toward financial goals is crucial for long-term success and stability.
What is the problem with not knowing what’s in your bank account?
Ignoring your bank account can lead to overspending, missed payments, and financial instability. Staying informed about your finances is essential for making informed decisions and avoiding unnecessary debt or fees.
What is the lesson from Rachel’s experience with moving to a new house?
Rachel realized that moving to a new house wouldn’t solve underlying issues or bring lasting happiness. External changes, like a new home, don’t address internal dissatisfaction, emphasizing the importance of contentment and self-awareness.
- New year, new financial habits
- Reflecting on past financial anxieties (Y2K)
- Importance of fresh starts
Shownotes Transcript