Ten things to do Ten things not to do

I've talked to consumers, counselors, and financial experts to come up with these Top 10 lists of things you should and should not do regarding your finances.

Top 10 things not to do:

  1. Don’t pay for bad habits. Little things can really add up. For example, don’t leave the air conditioner on full blast all day; you’ll add 5% on your cooling costs for each degree.
  2. Do not pay ridiculous fees. ATM fees, over the limit fees, late fees are all a waste of money.
  3. Do not confuse the terms ‘qualify’ and ‘afford.’ Just because someone will lend you the money, doesn’t mean that you can comfortably pay the bill month after month.
  4. Do not mistake shopping as a recreational sport. Emotional spending doesn’t work. Instead, try to always remember how great it feels to have peace of mind.  
  5. Don’t use the IRS like a piggy bank. There is no reason to take your hard-working money out of commission. Just think, if your annual refund is $1,000, that means you could increase your take-home pay by more than $83 a month.
  6. Don’t pay someone to “fix” your less-than-perfect credit reports. There is no company or person that can repair your credit any better than you can.
  7. Don’t underestimate the impact of blending friends and money. Lending money to a friend can end up costing you much more than the amount of the loan. And be very careful when blend finances with a significant other until you have legal protections, such as a marriage might offer.
  8. Don’t ever take out a payday loan. Quick cash loans, often called payday loans or cash advance loans, are short-term, high-fee loans that can turn a temporary setback into a major financial crisis.
  9. Don’t listen to advertisers who sell the idea of entitlement. To be entitled means that you are guaranteed something regardless of what you do. You may deserve everything you have ever wanted— that’s not the point. The key is to be happy with the things you already have.
  10. Do not count on winning the lottery. There is a really, really good chance that you won’t.

Top 10 things to do:

  1. Save now for your future. You’ve heard it a million times because it’s true: the eighth wonder of the world is compound interest.
  2. Communicate openly. Research consistently shows that money is the most common source of disagreement for couples, regardless of age or life stage. Approaching the issues honestly and openly gives you a much better chance at a strong, healthy financial relationship.
  3. Pay down debt. Too much debt is not merely a financial problem. Financial problems can negatively impact job performance, health, and personal relationships.
  4. Teach your children. Too many young adults have to learn about money from the school of hard knocks. Remember, children learn more from what they see you do than from what you tell them.
  5. Shop around. Your creditors would not just accept you at face value, so why the double standard? Shop for credit as you would shop before making a major purchase.
  6. Protect yourself from ID theft. Identity theft is the fastest growing crime in America with millions of victims each year. Furthermore, identity theft victims spend hundreds of millions of hours each year resolving problems related to identity theft.
  7. Build a good credit history. Your creditworthiness matters most when you are trying to obtain credit. Credit reports might also matter when renting an apartment, obtaining insurance or securing some types of employment.
  8. Plan for periodics. At the very least, be prepared for periodic expenses such as auto repair bills and Christmas. Ideally, you should also be prepared for medical debt, divorce, and a job loss; even if you are lucky enough to avoid these financial disasters.
  9. Know your rights. Solving credit problems can take a lot of time and effort. However, by educating yourself about your legal rights (FCRA, FCBA, ECOA, FDCPA) you can ensure that you are treated fairly. 
  10. Get help if you need it. Assemble a financial team. Members might include a lawyer, a tax advisor, a credit counselor, and a financial planner.

Kim McGrigg is the former Manager of Community and Media Relations for MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.