With so much focus on saving money you could get so used to pinching pennies that you’re not sure when to finally loosen the reigns and open the wallet back up.  While it doesn’t mean there should be a spending free for all, but if you have certain financial areas cleaned up, then maybe it’s ok to put on a few charges.  Before you start clicking ‘buy now’ on numerous websites, it’s a good idea to ensure you double check to make sure it’s the right time instead of continuing to spend and put you further away from being financially ahead.

Do You Have an Emergency Fund Built Up?

You could be plugging along finally starting to live outside of paycheck to paycheck when all of a sudden you get hit with a major bill.  While it’s likely to go on a credit card and put you further into debt, causing you now to increase monthly expenses making payments, there is a way to avoid this.  By giving yourself a few months’ worth of reserves in an account, you can have a financial cushion to be prepared if you were to have a vet bill or auto repair that you could not normally be able to cover.

Are You Out of Debt?

Certainly, it can take thirty years to payoff a mortgage or even five years to payoff an auto loan, we can remove those from ‘debt’, as your income can cover those payments, along with monthly utility bills.  It’s when you start to carry a large amount of credit card debt over to the next month is when you really can start sinking.  If you’re not able to payoff the full statement balance you will get hit with interest, which depending on the balance and interest rate, could be significant payments.  Paying only the minimum payment will keep the account in good standing but could set you back decades until the balance is finally paid off.

Are You Maximizing Retirement Savings?

While its retirement may still be decades away, that doesn’t mean you can continue to put off saving until it gets closer; you simply won’t have enough to live off when you are expecting to live the same life you have now, except without the grind of working.  Check at work to see if you’re taking advantage of the full-company match contributions, where as say they will kick in up to 6%, you want to make sure you’re putting in 6% as well, otherwise that will be missing out on free money that will definitely cost you not only now, but down the road when you really need it.  After working all of these years, do you want to be traveling and checking items off your bucket list, or if you continue to avoid saving, you may be forced to pinch pennies on an extremely fixed income, or even take on work in your golden years.  By maximizing retirement savings now and continue to increase each year, you can ensure your nest egg for when you are finally able to walk away from work.