Maintaining a line of credit is a necessity for most people. Without car loans or mortgages, you won’t be able to build a good credit score and achieve milestones in life. However, research shows that nearly 71 million Americans with credit have mounting levels of debt in collections.
This shocking statistic stems from the lack of basic financial literacy among young adults. Bad money management can result in huge credit card bills and wreak havoc on your finances. Here are some of the biggest financial mistakes that can lead to debt.
Picking up a latte on your way to work may not seem like a significant expense but they tend to add up over time. Studies show that brewing your own coffee can save you a little over $60 each week. One of the biggest financial mistakes people make is spending too much money on little things that can result in debt over time.
In order to avoid frivolous spending, it is important to stay mindful every time you buy something. Take a look at the recurring expenses in your life and decide if you want to cut them out completely or look for cheaper alternatives. This can help you avoid debt in the long run.