By Michelle Smith
WWR Article Summary (tl;dr) When it comes to determining whether you’re just being paranoid or whether you’re really in financial trouble, there are clear signs you’re moving into a perilous financial situation. From using credit cards to pay for everyday expenses to taking payday loans, it may be time to assess your wants and your needs.
It’s not uncommon to worry about money. More than 60 percent of people polled for the Marketplace-Edison Economic Anxiety Index reported being anxious about their finances either sometimes or frequently, and 32 percent said personal finances caused them to lose sleep, up from 28 percent in September 2015.
To a certain degree, thinking about money is normal and prudent, but experiencing stress or anxiety, or obsessing over money, are financial red flags. “And the more you think about money, the bigger your problem probably is,” said Dolph Janis, founder and owner of Clear Income Strategies Group.
When it comes to determining whether you’re just being paranoid or whether you’re really in financial trouble, look for signs you’re going broke.
YOU PUT YOUR WANTS BEFORE YOUR NEEDS
Needs are costs for everyday living, such as your mortgage, utilities and medical care. Wants are things you would like to have, like that cup of coffee from Starbucks, another pair of shoes or a vacation.
“If you’re living your life covering your wants first and your needs later, you’re headed for a financial crisis,” said Janis. “If your needs aren’t covered, before you make any purchase, stop and ask yourself, ‘Do I need this or do I want it?'” If it’s a want, realize you can’t afford it.
YOU LIVE PAYCHECK TO PAYCHECK
Being desperate for your next paycheck is a clear indication you’re going broke. It might be a sign you act on impulse and you’re so concerned with today that you spend all your money without regard for tomorrow.