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Looking at Spending Habits: Lies You Tell Yourself to Justify Uncessary Purchases

written by: •edited by: Rebecca Scudder•updated: 2/13/2010

When dealing with money, people tend to tell little white lies to others about how much then earn, spend and owe. However, oftentimes people also lie to themselves when it comes to finances, particularly about budgeting and debt, leading to poor spending habits that get out of control.

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    Money is always a touchy subject. However, many people don't just lie to others about their finances, there are also many financial lies that we tell ourselves to make us feel better about our spending habits, which can be destructive to our long-term financial security. Don't fool yourself into thinking that it's alright to overspend and go into debt. Instead, realize that sensible budgeting and smart money decisions will secure your financial future. Here are a few of the financial lies that you should avoid to keep your spending habits under control.

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    It's worth it because it's on sale.

    Many times we tend to buy items just because they are on sale, even when we don't need them. This leads to overspending and debt. When shopping, whether for groceries, clothing or high end items, bring a list to the store with you. Stick by the list and don't impulse buy just because something is on sale, it will help you save money, and help you control your spending habits.

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    I'll just file bankruptcy and I can start all over.

    This is a very common misconception. With bankruptcy, you don't get a completely clean slate. In fact, a bankruptcy stays on your credit reports for 10 years, which will hinder you from getting credit. Additionally, child support, government student loans and tax liens are not relieved and discharged in bankruptcy.

    This is no excuse for poor spending habits and shows great irresponsibility. Once a person files bankruptcy, the care of personal finances and spending habits must change, because there are rare instances where the same people can file twice. Take care of your spending habits now to avoid bankruptcy all together.

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    I'll charge it and just pay the minimum on my credit card.

    Paying the minimum payment on your credit card does nothing to pay down the debt. In fact, it oftentimes doesn't even cover the interest you accumulate each month. Therefore, you can spend years paying off an item that you charge to your card. Spending habits like these will commit personal finance murder, because you'll never be able to dig yourself out from under the pile.Try to use credit cards for emergencies only, or for items that you will be able to pay off completely in three month's time.

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    It's okay to splurge and be in debt, you only live once.

    Though it's acceptable to splurge once in a blue moon, it's not alright to live in debt. If you are constantly overspending and racking up debt, you are setting yourself up for financial disaster. Instead, have a concrete budget every month that tracks your income and expenditures. Allow for a small entertainment allowance which allow you to do something fun without risking your financial future. Controlling spending habits with a budget will ensure you're prepared for emergency situations and extenuating circumstances that may arise later.